When to leave for buyside?
I've been in London SS ER for 1 year in a hot sector with probably one of the best analysts on the street and just been told i'll be initiating on a company in the first half of 2022.
But I have always wanted to go to the buyside and know SS isnt my long term career preference. The only issue I have is when I should start recruiting.
Would I have a better shot at recruiting for LO/HFs after or I initiate or should I start ASAP? The only reason I ask about recruiting after initiating is I feel its the best way of showing the quality of my work and means I have actual contact with analysts of funds I want to work for. But i'm worried that it might mean working in SS for 1-2 years more to build up rep which leaves me at risk of being pidgeonholed as a SS'er.
Any answers would be great, especially with a London focus as I know US is quite different!
Don't know much about UK market, but 1 year seems early. 1.5 years into the job you should see more traction with recruiters and fund HR responding to your job applications.
You should understand clearly why LO versus HF, what's your investment style, and what shops are in UK that suit your philosophy. Try your best to get into a situation where 1) people are nice 2) you fit the philosophy strongly (not gonna be 100% but needs to be close enough) so that you have longevity on the role.
I strongly advise against going for options that have the highest compensation upside without assessing your ability to scale to an idea generation capacity (with comp tied to your contribution). The analogy here would be if you are a marathoner but you are forced to operate as a sprinter - you will be miserable, you won't be growing, and your employer will have to let you go knowing you will never grow into the next level at that firm. I am speaking from experience.
As always the most helpful ER poster :)
Thanks for the points on HF/LOs, and I agree in the past year I find myself still wondering which one fits me better.
Maybe just a quick followup, if 1 year is too early when is too late? I understand in M&A associates have a slightly more difficult time moving to PE but for ER is the 3 year point the same? Personally I still think I have lots to learn under my analyst but a bit afraid of being seen more as a SS'er as opposed to potential investor if I do take my time.
It's too late when you have to take a pay cut to go to the buy-side, probably when you make VP on the sell-side. 2-3 years seem fine in ER. Of course you are ready, don't stay so long because you don't really learn to be a better investor over time on the sell-side (especially if you want to invest marathon-style like I do).
Now
If you're getting genuine interest / interviews now, then go for it. However you'll probably find life easier after an initiation & some experience covering clients directly. Some experience pitching & defending your own (not your MD's) thesis from clients is pretty crucial for making it through interview #1 with most places on the buy side.
The sweet spots for moving to the buy side in London seem to be 2-4 years (when I made them move: you have some stock and client coverage, but you're still young enough that you don't have to take a big pay cut to move & your new PM will be confident they can mould you to fit their own investment process or to cover a new sector) or after 10+ years of sector coverage (moving to Fido / Capital / T Rowe etc as an experienced sector analyst).
I’ll be starting in SS ER in the US this summer. Would you mind me PM’ing you as I’d like to move to London after a few years. Thanks!
I had a call with one of the main MM’s and they were strongly suggesting that the 2 Year recruitment timeline is outdated and that 1 Year is enough. Not saying previous comments are wrong but that is what I was told directly from the source.
For London or NYC?
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