BB FIG to Distressed PE/HF?
Is it possible to go from a top FIG coverage group to distressed/SS credit fund or would it require a lateral to RX/Levfin first? Also any specific verticals in FIG that would help (Banks vs Specialty Finance vs Asset Managers)?
I've seen this done before by a few people--no one I know particularly well, but have definitely seen several people on distressed debt fund team pages who previously worked in some top FIG group. I would think Banks/Specialty Finance would be the most relevant vertical to cover because you won't be totally out of your depth if the fund wants to buy a portfolio of non-performing loans
I actually think the move from FIG banking to credit fund makes a lot more sense than people think. (1) Many credit funds have pockets of capital that invest in the assets of spec fin companies (i.e., the loans). (2) some credit funds will acquire specialty finance companies at the GP level and then fund the ending activities through the fund (i.e., the credit fund buys loans originated by the lending platform (either as whole loans are as bonds post-securitization just like it would any other fixed income product). (3) if you think about the economics / return profile of owning the equity in a specialty lender, its very similar to buying bonds with leverage.
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