Moving from Co-Invest / Secondaries to HF
I have spent the last 3 years at a small co-invest / secondaries shop as an associate. Prior to this, I was an analyst at top bank in a top group (if that matters) that regularly sends people to MF PE and HF but I ended up landing here. Was quite happy with it at the time given the combo of WLB and comp, but I've realized I want to move to public equities. I'm worried I made a mistake taking this job as I am unsure what my exit opps are now.
Would headhunters / funds be open to my background? I had a call with a BD guy at one of the pods but didn't hear back and same with another HH who said he would pitch me to Balyasny Bridger.
Would appreciate any guidance on my best path forward. FWIW I did find a guy on Linkedin who moved from AlpInvest Co-Invest to HF 10+ years ago but that was a different time.
In more or less the exact same position as you so will throw my 2 cents / how I've been thinking about it - PM me if you want to swap notes or discuss approach at all. My view is that co-invest / secondaries debatably positions you better to do the actual work required at a fundamental HF, assuming you can communicate your story correctly given it is a less common background that few folks will understand / may write off without context. Have confirmed this in discussions with mentors of mine who've gone the PE -> HF -> LO route.
Co-invest / secondaries investors likely have a more transferable skillset (assuming you're not at one of the family office-type shops where diligence is more check-the-box and you are in essence a "capital solution" provider) given (i) you review a significantly higher quantum of deals than traditional buyout, meaning you can iterate on and hone in your investment review process more quickly than buyout, (ii) a greater proportion of your time is spent actually reviewing investments vs. operational and portco work - developing a 30/60/90 day plan and spearheading executive searches isn't transferrable to a HF - investment analysis is, (iii) you are (mostly) a price taker vs. price setter in co-invest/secondaries, directly akin to publics, (iv) you have likely reviewed and hopefully somewhat absorbed the investment thought process of many of the best privates investors in the world while reviewing their IC materials, helping to build your own toolkit as you retain the viewpoints you like and leave be the ones you don't, and (v) you bring a unique and contrarian background to the HF team (e.g., alpha) - which in publics is actually valued vs. the cookie cutter backgrounds preferred by private equity / banking.
All that said, the caveat and uphill battle here will be that you don't have the same stamp of approval that a MF Associate stint gives you, (which would somewhat de-risk the hire for the HF) and the resulting pipeline to some of the top funds ("pipeline" is likely generous - these seats are still quite tough to get). Overarching point is that hedge funds value performance over pedigree (unlikely PE and banking) so if your skillset enables better investment analysis and contribution to portfolio performance at the HF, and you can demonstrate it - they will recognize and value that.
Transitioning from a co-invest/secondaries role to a hedge fund (HF) focused on public equities is definitely possible, but it requires a strategic approach. Based on the most helpful WSO content, here’s what you need to know:
Your Background is Not a Dealbreaker:
While co-invest/secondaries roles are not the most traditional feeder into public equities, your prior experience as an analyst at a top bank in a strong group is a significant asset. Headhunters and funds value candidates with strong technical skills and a solid foundation in financial modeling, which you likely developed during your banking stint.
Challenges You Might Face:
Steps to Improve Your Positioning:
Headhunter Strategy:
Consider Intermediate Steps:
If breaking directly into a hedge fund proves challenging, you might explore roles that are tangentially related to public equities, such as equity research or corporate strategy. These roles can serve as stepping stones while allowing you to build relevant experience.
Mindset and Persistence:
The transition to public equities is competitive, but it’s not impossible. Many professionals have successfully made similar moves by being persistent, strategic, and open to feedback. Keep refining your approach and don’t let initial setbacks deter you.
By focusing on your strengths, addressing potential gaps, and leveraging your network, you can position yourself as a strong candidate for public equities roles. Good luck!
Sources: Any career regrets after moving from PE to public markets?, Why I Left PE & Switched to the Public Markets, https://www.wallstreetoasis.com/forum/private-equity/why-i-left-pe-switched-to-the-public-markets?customgpt=1, Breakdown of Post-IB Exit Opportunities
It's doable, but you'll have to be a lot more active than relying on headhunters. You should reach out to funds directly, pitch them ideas, send them write-ups, and network a lot in order to stand out and prove how much you want this.
If you just send your resume to a recruitment firm and sit back waiting for a call, your odds are very low.
what are your thoughts on trying to move from a large credit HF (SM, public stressed/distressed) to l/s equities (MM or SM)?
I chose to join a credit HF for my junior SA over banking, but am very interested in l/s equities. I worry I might be pigeon-holed if I join the credit HF full-time.
I've seen some people make that transition. Particularly if you can find an equities PM/fund that is into concentrated positions that require deep-dive analysis, those types of guys often like analyst profiles coming from credit or PE.
Secondaries provide a unique perspective on valuation that many public equity shops actually value. Your biggest hurdle isn't the background, it's proving you can pivot from a long-term private mindset to the daily mark-to-market volatility of a hedge fund. Start refining a few high-conviction pitches now.
thank you chatgpt
I would try and downplay your secondaries experience as much as possible (even though it's more akin to public market is some ways), at least with HHs. Came from a top secondaries shop and had a HH at at DSP tell me straight up that "you're an allocator vs. people in traditional PE, which is not valued"
Did you manage to get into HF? Or still recruiting?
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