I would like to hear inputs ONLY from currently working i-bankers since you guys must be in a better position to give me an advice.
I'm currently working at a NY-based boutique (healthcare focused) and just realizing 80% of the time, we only do "sell-side" m&a deals. This is getting me really concerned / nervous about the next few years down the road.... i know so well PE guys like analysts who have had rather "buy-side" experiences. As i would be very much interested in moving to PE later on, am i really screwed at this point...?
I would especially appreciate any input from those who were in a similar situation as I'm currently in but made a successful transition into PE and whatever exit opportunities.
Thanks much in advance!
I'm not sure what you're talking about. Sell-side is banking, buy-side is PE. Why/how would you get buyside experience at in an investment banking division?
You may be using the wrong terminology... are you saying you are usually advisors to the sellers as opposed to advisors to the acquirers?
If thats the case... its a bit odd, since business comes in through relationships and the relationship doesn't know if its buying or selling. It could just be that your industry in general is target to certain trends that preclude you guys from advising acquirers. For example, say your a MM boutique and there is a trend of large PE shops creating a portfolio of HC companies. So they snap up all these MM firms and consolidate them. In that example, Apollo/Carlyle/KKR likely won't be calling you guys up for advisory but the small HC firms just may because thats where your relationships lie.
So in the above example, there's really not much you can do where you're at right now. You could try to move to another shop... but I think thats really making too much out of your situation. If you've got good deal experience, I don't see why you can't get into a HC focused PE firm.
Thanks. Yes - i actually meant sell-side m&a as being advisors to potential sellers of themselves for a variety of reasons. You made a good point. All the big PEs or strategics wouldn't likely call up MM boutique for advising them for buy side opportunities unless you are Greenhill, Evercore, etc. who can compete with bulge bracket firms. I'm just a big worried/concerned about having to compete against all these analysts who started in the same year at BB and have many buy-side advisory experiences when moving to the PE side.... With this said, I just wanted to hear some voice of any ppl who have gone through a similar experience.
Stop saying buy side sell side referring to transaction participants.
The sell-side are bankers because they're selling their services. Buy-side is HF/PE because they're buying those services.
he's referring to the engagement... a buy-side advisory mandate vs. a sell-side advisory mandate...
This terminology is very common...
how else do you differentiate the sperate banks advising the buyer and the seller?
Target and acquirer... and seller in the case of a 3 party transaction.
I've very seldom heard anyone call themselves a sell-side adviser or buy-side adviser.
I agree with MezzKet, as long as it's clear what he meant I don't see the issue - I have worked on what I would term 'buy side' engagements in the past where I was acting as an advisor rather than principal.
In any case, I wouldn't worry too much about working mainly on sell side deals. They are more interesting, more labour intensive, more varied and will give you better experience (you will also likely help to pull in more in fees for your firm which will be good for your bonus). PE houses will realise this.
Admittedly this is from a UK perspective where the "2+2+2" that people in the US obsess over is more prevalent, but having worked at one of the larger London-based PE houses in the past I can tell you that this would not be an issue whatsoever - PE guys have a broad range of backgrounds, the only common denominator is they are all very, very good.
"Buy-side advisor" and "sell-side advisor" are very common terms when referring to M&A at my bank.
I also agree - sell-side vs. buy-side for a M&A deal is very common phrasing.
I would say that PE funds like to see some buyside work because it's more valuation intensive, but good sell-side experience isn't a negative - sponsors have to exit their portfolio co.'s at some point so you'll be well equipped to manage that process. Also, if you've worked on a some buy-side engagements before but they just didn't close it's still fine to reference them on your resume.
Also keep in mind that you have a much better shot of completing a sell-side mandate than a buy-side one, so the majority of analysts will have more experience with those deals.
At my bank, "buy-side" and "sell-side" advisor are used all the time when talking about M&A deals. While most of our engagements are as "sell-side advisor," some of our opportunities are "buy-side" engagements.
To answer you question, you have nothing to worry about if you mainly work on transactions as the "sell-side advisor." PE firms want to know what you did on a transaction/project (modeling, diligence, research, etc.) and that you have a good understanding of deal process, which is why they like their candidates to have closed transactions, rather just a bunch of pitches that didn't go anywhere, but where you did a lot of work.
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