The Golden Path (Rx IB --> MF PE --> SM HF) is Paradise

High School: 

You were always destined for greatness. As a high school senior deep in the lore of WSO—able to rattle off the acronyms MF, BB, EB, TMT, MM, SM, SA, RX, BAAM, CVP/LAZ/EVR/Q, and FTP with an almost religious conviction—you cracked the code on how to position yourself for financial success. Harvard, Yale, Princeton: Those schools produce weak politicians who will never crack a six-figure salary. No, you will go to W: A school so revered in finance that it need only be mentioned by a single letter, whose very utterance sends quivers into the spine of anyone on the Street. Your four years were spent in service of this goal. By day, you developed diversity statements for your local DECA branch; by night, you scrolled on WSO threads such as GS TMT vs Qatalyst SA 2022, or PJT RSSG vs BX PE SA2023, honing the financial literacy necessary to propel you to success. Such hard work pays off: You were admitted to the Wharton Class of 2029, early decision no less. 

The Summer Before College:

It doesn’t matter that you were never invited to a single party in high school—no prom, no after-school hangouts, no football tailgate. No, you were focused on something far more important: exits ops. Maximizing potential outcomes, positioning yourself for success: That is all that matters, and anything else is a distraction. You live out your summer before college this way. While your friends get wasted backpacking in Europe, you dedicate yourself to mastering finance technicals, free from the distracting assignments that plagued you in years past. The M&I 400 Questions Guide, Rosenbaum & Pearl, Moyer’s Distressed Debt Analysis: You can walk through the impact on the three financial statements of uptiering a $10 PIK debt receivable note between a Hold Co and Op Co in a double dip transaction as if your life depended on it. You begin at Wharton in early September, ready to join the greats who’ve been educated in Philly in the decades before you.

Club Rush:

You were not meant to be an ordinary Wharton student, however. Momentarily insecure that you may be average among your peers, you immediately segregate yourself into a pre-professional group with an acceptance rate lower than a Rhodes Scholarship. Your interviewers within WITG (SSG/Tac Opps only) and GPS (2 admits in the whole freshman class) were aroused when you walked through the legal loopholes that allowed junior creditors to launch a non pro-rata uptier in a chapter 11 case in Delaware Bankruptcy Court from last December. Your feeling of self-gratification is short-lived, however. Summer analyst recruiting has begun.

PJT RSSG SA2032: 

Banks are already filling their SA2032 class by June after your first year, quickly separating the wolves from the sheep—the dedicated finance professionals such as yourself from the children who need to be shown the door. GS, MS, JPM—those institutions are legacies of a bygone era, their multi-hundred-person analyst classes composed of C-list students who stumbled through interviews that you could’ve slept through in middle school. You, after all, are you—W student, board-member of WITG SSG, an intercollegiate officer of GPS, a WSO warrior with enough bananas to feed a small island nation—and, as such, you aim for restructuring banking. The technicals are tougher; the work more exhilarating; the exit opps incomparably superior. And only one bank consistently clears the league tables: PJT. 

While BB analysts respond to “Suggested Networking Questions” lifted from a rare liquid video on YouTube—“What’s your favorite deal you’ve worked on?”; “What’s Training Like?”—the elite mercenaries at PJT RSSG have no such time to waste. No, after answering your 9th email follow up with an offer to speak at 11:30pm, they technically screen you in a pissing contest that would make most prospects squeal. “That’s interesting, but don’t you think joining a shareholder bond committee has unforeseen legal consequences?” | “Why would you suggest structural subordination over a drop down when the case company has $100m in IP on its balance sheet?” While other students quiver like the pitiful M&A sheep that they are, you stand strong. Breezing through the questions, you get referred to a first round interview. Before even starting your sophomore year, you’ve locked yourself into a junior-year SA position with PJT RSSG. 

On-Cycle 2033:

After converting to full time, most college seniors would’ve taken it easy their senior year. But not you—the incoming analyst at PJT RSSG (*RSSG specified*, lest your LinkedIn community think you are some plebeian in PJT’s 2nd-tier M&A group, not able to crack CVP/EVR/GS (TMT/FIG only)/MS (M&A / M&C only)). While your classmates party and get ready to travel before starting their roles in the summer, you prep for On-Cycle recruiting. After all, with PJT RSSG’s 100% on-cycle placement rate (50% to Apollo, 30% to Centerbridge, 10% to Blackstone, 10% disposed of Old Yeller style), you are well-positioned to be the cream of the crop. One hour after your Wharton graduation (CPI is tracking the ceremony before sending out on-cycle interview requests), your inbox is flooded. But no matter: After 17 interviews, you land an Associate 2035 job with Apollo.

PJT Full Time:

After 4 years of grinding through high school, 4 years of grinding through college, and 0 social interactions beyond your weekly WITG SSG Delta Force IC meetings, you’ve hit the desk. And it is only reasonable to have your soul collapse on itself when you realize that you’re the world’s most overworked paralegal. Three months in, you’ve spent 95 hours per week summarizing credit documents in Word, weeding through tens of thousands of pages of illiterate English written by Kirkland lawyers trying to reach their hourly billing threshold. Six months in, you’re 20% heavier, 30% balder, and 100% confused as to why you’re not getting any Hinge replies to your prompt “Ask me anything about bankruptcy proceedings.” Nine months in—physically weaker, socially devoid of any conversation beyond comparing your college investment club’s acceptance rate with the other pour souls in the bullpen—you get a tap on your shoulder to be the sole analyst on a creditor transaction. This is what the pain was for: You, finally, will prove yourself.

Steel Co, a commercial parts manufacturer based out of Topeka, Kansas, is considering filing for bankruptcy. The company is out of cash, and the vultures are circling. Ares, positioned in the senior secured tranche as the direct lender, is owed $300M. And Fortress—investing out of their “opportunistic credit” fund—parked $85M in some dogshit unsecured junior position that they picked up at 35 cents on the dollar last year. Fortress has hired PJT to recover their position—because, of course, their financial backer (the Saudi Royal Family) is at serious risk of going under.

Fortress would be happy with some sort of out-of-court restructuring—one that suggests a debt conversion to minority equity, call it 5% of the business. You, however, being the finance warrior that you are, laugh at this plebeian suggestion. Rather, you do what any reasonable banker would do—you strip $100M worth of equipment leases from Steel Co and move them to a shell company in the Cayman’s that your legal department set up. From there, you have Steel Co create a new senior tranche of debt above Ares’s tier, secured by the leases, which Fortress moves their money into. At the end of this, Fortress obtains a minority equity stake (35%) in the business, which Steel Co is all too happy to agree to—the executive board gets to maintain a majority stake. 

Now that the Oregon State Teacher Pension Fund (one of Ares’s largest LPs) has lost $150M and the Saudis are wealthier, you know that you’ve done your job well. This is what you’ve dreamt of since high school—being one of the most feared financiers on the street, the kind of man whose name being included on a pitch deck commands immediate respect. The next 15 months at PJT, full of more creditor and debtor mandates than you could dream of, derive a newfound kind of meaning for you. You’ve destroyed your soul, but you are now a killer.

Interim:

In the two weeks between your analyst stint at PJT and associate job at Apollo, you begin to Google some of your peers. Katy, who was on WITG’s T3 consumer/retail team, landed a T4 CnR job in Stifel’s T5 regional LA office, covering LMM M&A. Her Instagram story, full of beach outings and margaritas, boasts of the WLB—she puts in only 50 hours/week, 55 less than you pulled during the debtor transaction last week that handed Red Lobster over to, coincidentally, the Saudis. Now, she’s moving to some $200M VC fund in Santa Monica that you’ve never heard of. Feeling vindicated as an incoming associate at a $450bn MF, you laugh at her profile — the hard work you’ve put in is finally paying off.

Apollo:

You’ve made it to Apollo buyout, further distinguishing yourself from the poor RX analysts who could only land roles in credit, special sits, or God forbid, hybrid value. As the top analyst from the top group at the top boutique on the street, you are surprised when you’re not staffed on the most deals out of your associate class. It was then that you learned of Jake.

Jake went to an absolute non-target (IU Kelley, Arizona State, Cornell), but through the grace of the Almighty and 7,200 cold emails, he made his way to a mid-tier group at a mid-tier bank (GS Industrials). While you flexed in your WITG alum Discord chat about how you averaged 3 hr / night of sleep during the Red Lobster bankruptcy, Jake has not known sleep for the last 2 years. While averaging 130 hrs / week at GS, his comments became so revered that despite the numerous HR complaints from the other analysts—once a SAE pledge master, always a SAE pledge master—the MDs kept him staffed on 7 deals and cut him a $200k bonus under the table.

While Jake is put on the flagship FIG deal, you are relegated to some distressed roll up of shitco pediatric facilities across the Pacific Northwest. You cling to your Wharton and PJT RSSG credentials, more desperate for external validation than Honey Boo Boo is for a Wendy’s Baconater. Yet at the year end, you receive only the mid-bucket salary of $425k. As a 24-year-old now on the verge of poverty, your ego is beyond repair.

Two months later, an auspicious email graces your inbox. A recruiter from “Tiger Global” lauds your background —“We’re impressed with your roles at PJT and Apollo, and think your deep private-market experience could give you valuable insight into public equities. Would you be interested in interviewing for an analyst position at Tiger?” While you always thought of yourself as the next Marc Rowan, you realize Ken Griffin is also a suitable image. And when you find out the pitiful non-target Jake didn’t get the email—he was not prestigious enough for a fund like Tiger—you reply 4 minutes later for an interview. Two case studies later, you’re an Investor at Tiger Global.

Tiger:

You’re finally among a worthy set of peers: Harvard —> BX —> Tiger, Yale —> KKR —> Tiger, Wharton —> EVR RX —> TPG —> SL —> CD&R —> H&F —> HBS —> Soroban —> D1 —> Tiger. And your cumulative knowledge is reflected in your rigorous analysis. You buy a portfolio composed of ⅔ total Apple, Amazon, and Netflix—your peers’ sophisticated insights allowed them to deduce that the “sticky revenue,” “large market share,” and “deep moat” of FAANG companies makes them undervalued by the market. You employ a “concentrated” approach that shuns risk and volatility hedging—your peers, after all, are the most pedigreed investors on Wall Street. No world exists in which your investments are misguided.

6 months into your role, your book is performing well—up 23% YTD, in fact, suggesting a 5M bonus is all but yours. Pulling up your Bloomberg terminal, however, you see a blazing red alert: The Newsom-Cortez administration just launched a $50,000 / citizen stimulus program to reduce “structural” inequalities. Within 3 weeks, as inflation reaches 31%, the Fed raises rates, pushing the 30-year to 8.9%. Your fund’s cumulative return plunges 40% and LPs withdraw en masse.

Reflection:

While on sabbatical (the term “unemployment” is unbecoming for someone as important as yourself), you look up Katy and Jake. After leading a $2M seed round in Logan Paul’s energy drink—it’s now worth $900M—Katy made partner at her VC fund and bought herself a $25M beach house in Malibu. And after Apollo non-target Jake rolled up 5 annuity businesses into Athene in under a year, he became the youngest principal in the firm’s history. Feeling depressed, your mood quickly changes. A recruiter from a Tiger-great–great-grandcub crossover fund just reached out to you: “We’re impressed with your experience at PJT, Apollo, and Tiger Global. Your insights in the private and public markets could be valuable to us—would you be free for an interview next week?” 

The Golden Path is Paradise.