I’m a rx lawyer at a top 5 firm in NY, but would love to eventually end up at a distressed debt HF. My sense is that crunching through debt docs and devising creative solutions for the debtor would be helpful experience in a DD seat—assuming I can get some experience in RX IB (which I know is absolutely not guaranteed), would my legal background be a +, -, or neutral factor? If it depends, what HFs like legal backgrounds? Thank you very much in advance.
Trending Content - Hedge Fund Forum
| +21 | Do Quantamental roles really exist? | 8 | 36m |
| +14 | Average single manager slope | 5 | 2d |
| +13 | Fastest Way to MMHF? | 9 | 23h |
| +9 | Bad PM | 5 | 20h |
| +9 | Yes, this question again… | 2 | 13h |
| +6 | Hedge Fund (Fundamental Long Short Equity) Compensation in Singapore Hong Kong | 2 | 32m |
| +5 | X | 6 | 2d |
| +5 | Worth Joining a Small Hedge Fund? | 6 | 7h |
| +3 | Possible to do opportunistic credit in SF? | 1 | 9h |
| +2 | Walleye SA 2027 | 4 | 3d |
Career Resources
You want to be an investment analyst, not a HF lawyer right? If so IB first is definitely the way to go.
Yes—I should have clarified that. I’d like to be in an investment capacity, not a lawyer.
Alright, I'm assuming you have a rolodex of bankers that you work with and grab drinks with. If there are guys you trust, perfectly acceptable to broach the topic with them about a potential move. Being an rx lawyer seems like a brutal job from the outside looking in, so people will be understanding. MBA associates also tend to be much lower quality than analysts in restructuring, so if you have a good working relationship your skills should be in high demand.
Otherwise you can cold email, every rx firm has an ex lawyer somewhere on the team. Anecdotally, seems like Evercore and non-NYC HL have the largest group of non-banking experienced hires.
You will probably have to take a slight paycut moving from associate to HF, but it won't be much, with your eye on the final prize - SM seat with meaningful comp upside for performance.
RX is the only field in finance were a background in law is seen as positive. The transition should be done mainly by networking and reaching out to some RX guys in investment roles that were also previously lawyers. If not, look for shops were RX lawyers may be an extremely small % and apply there maybe they want to expand some investment seats with some RX lawyers. The market for RX currently is favorable and it may continue to be so in the 2024 so it's not as affected as other seats that depend on economics booms. If nothing works and you're 100% decided to be in finance an MBA always will do the job.
I went to law school and have several friends that RX at big law firms and then transitioned to distressed debt and other special situation investing roles. All of them were able to make the switch directly into investing shops without a stop in banking, so you shouldn't foreclose that possibility.
I think a law degree is so much more valuable than an MBA, especially in high finance.
If you’re already doing Rx law, maybe have drinks with one of your closest clients that you did good work for? You clearly understand all the finance terms and complex legal issues, you just need to prove your ability to show investment skills. Maybe develop some trade ideas on your own to showcase that.
While I don’t think you need to do banking, why not consider a restructuring group at a large IB?
With Rx law + IB Rx experience you would get access to not only more distressed debt investment opps, but also to some very attractive ones; where’s without the latter, you would get a smaller set and lower quality.
I know of someone that ran the M&A practice at a top law firm (STB, Cravath) and now works in PE at a MM fund. This particular dude is very, very good at what he does.
Restructuring is IB, and at the senior level, the PE skillset is very different from the HF skillset.
It would definitely be beneficial but it wouldn’t be sufficient. You’d also need to be able to demonstrate a minimum level of competency of finance skills. You wouldn’t need to be an expert or anything like that as you’d “just” need to be able to demonstrate that you also have a basic finance skillset. That you wouldn’t be starting from 0.
Also, timing is important. The best time to move is as a 4th-year-or-greater associate. If you move too early you wouldn’t have enough experience. If you wait until you are a partner/of counsel/etc, you’ll have to take a step backwards career path wise (ie - go from a manager level back to the grunt level) unless you are a partner at the level of someone like Karp or Lipton.
.
It can definitely be done - that being said, it doesn’t work well if your technically weak in the quantitative stuff. You need to be good at excel and ppt at the junior levels and just be good at the math, structures. Legal stuff is great but appreciate how dynamic the role is
Transitioning from a restructuring lawyer to working with distressed debt could be an exciting shift. You already have a solid understanding of the legal side of things, so it is a natural move. Distressed debt is all about finding value where others might see trouble, and with your legal background, you'll have a unique edge in negotiations and understanding complex situations. You’ll probably deal with investors and creditors, helping them navigate tricky financial issues. Suppose you’re thinking about expanding your legal expertise in this area. In that case, it might be helpful to look into additional training or connect with professionals specializing in distressed debt. You could also check out resources like https://www.levarlaw.com/arkadelphia-car-accident-lawyers/ if you want more insights.
Wondering if this ever worked out? Did you find an RX IB / SS seat?
Sed unde blanditiis ab id quam. Sapiente ut blanditiis harum maiores.
Accusamus corrupti recusandae dolore est ut sed. Commodi voluptates ea illo voluptatem reiciendis expedita. Porro qui voluptatibus quibusdam est officia vel ipsum. Ea nesciunt sed error voluptas deleniti occaecati mollitia. Eum maiores quos nihil expedita dolore. Voluptas mollitia delectus dolorem ex facere distinctio.
Beatae est quam architecto maxime et. Recusandae esse modi repudiandae consequatur qui tenetur. Aperiam sed unde et non.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...