Banking > Consulting for Corporate Exits?

I’m comparing MBB with top BB/EB in this situation. People often say that if you want to exit into a corporate function like corporate strategy at a F500, or later on in your career into a C-Suite role, you’re much better off doing consulting. People say that if you don’t want to do investing roles (PE/HF), then don’t do banking. I’m wondering if this is even true or if it is just self selection, and that the same corporate exits are open for bankers as consultants, just bankers choose to do PE/HF because they’re more interested in it and buyside roles pay substantially more.

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Based on the most helpful WSO content, here's what you need to know:

Banking vs. Consulting for Corporate Exits:

  1. Exit Options:

    • Consulting: Generally offers broader exit options. Consultants can move into various strategy and operation-focused roles, including corporate strategy at F500 companies and potentially C-Suite roles later in their careers.
    • Banking: While traditionally seen as a path to Private Equity (PE) and Hedge Funds (HF), banking experience can also make you competitive for corporate roles that require deal diligence, deal process, and modeling skills.
  2. Self-Selection:

    • It's not just about the roles being available; it's also about personal interest and self-selection. Bankers often choose PE/HF roles because they are more interested in these areas and the compensation is typically higher.
    • Consultants might prefer corporate strategy roles due to better work-life balance and broader career opportunities.
  3. Perception and Reality:

    • The perception that consulting is better for corporate exits might stem from the fact that consulting projects often involve strategic and operational improvements, which align well with corporate strategy roles.
    • However, top-tier investment bankers can also exit into almost any role if they hustle, including corporate roles, though they might be more inclined towards high finance exits due to the prestige and pay.
  4. Career Flexibility:

    • Consulting arguably offers more flexibility in terms of career paths, allowing for transitions into various industries and roles.
    • Banking provides a more focused set of options, primarily in high finance, but can still lead to corporate roles, especially if the banker has relevant experience in deal-making and financial modeling.

Conclusion:

Both banking and consulting can lead to corporate exits, but the choice often comes down to personal preference and career goals. Consulting might offer a broader range of exit options and better alignment with corporate strategy roles, while banking can provide a competitive edge for high finance roles and certain corporate positions requiring financial expertise.

If you have any more specific questions or need further details, feel free to ask!

Sources: Q&A: Consulting v. Banking, the age old question. By Former MBB and Bulge Bracket Banker., Q&A: Former MBB Consultant, Am I missing something about buyside exits?, Why do you go into PE only to go into HF, Why Would Anyone Go Into Consulting?

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I spent my whole career in PE/RE before landing a Corp Dev job at a F50 company. That said, everyone else I work with at the VP level or above came from consulting or rose up the ranks in corporate. I'm not saying banking won't get you here, but there aren't a lot of transferrable skills to go from being a salesman to strategically leading a company. Most of my friends who are bankers are extremely knowledgeable about the sectors and products they cover, but they are not operationally minded. Consultants usually have more operational experience through their mandates or at least the critical thinking that lends itself to operations/strategy more than banking. 

 

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