Corporate Dev=BS?
Is Corporate Dev at a big company all a bunch BS? Honest question, cause I have no idea.
Just not sure how you can be doing anything meaningful in one of these roles unless your high up. Sure, PE and IB are bullshit too at lower levels but at least you’re making a shit ton of money and “doin deals”.
To rephrase the question a bit, what does CD entail at a fortune 50-100 company?
CD at a public company. We have a team of 5 taking care of all transactions - modelling, socializing, assembling decks, pitching to ICs. We actively reach out to potential targets, financial buyers (to check if they want to partner or sell portfolio companies) and IB coverage teams. We also set long-term growth plans and strategize acquisition targets.
Same skills required - financial modelling and creating pitch decks for the board. For larger deals, we would engage 1-2 sell side advisors, mostly BBs to help us with the final round and issue the debt & equity needed
Agree with above, currently at a fortune 50 CD team. We run the whole deal lifecycle and unless the deal is 10+B we do not use a bank. We run the diligence, modeling, coordinate calls, do all the presentations for the c-suite, etc. Outside of deal work at the companies I have been at CD is regarded as a highly skilled versatile team. When there is a high profile project that may have nothing to do with M&A, our team gets called in a lot to diligence all the projections, thesis, etc that the product and finance teams have put together.
As for your point of being high up, my first CD job was at a publicly traded tech company, I was analyst level. I was in meetings with the CEO, CFO etc. pretty often so there was great visibility and although I was just an analyst there was no problem with me speaking up in those meetings. On the flip side when we are buying or selling a part of the company you get to interact with high level CD people on the other side of the deal and plenty of times the C-suite of the other company.
Personally I find it to be more rewarding than banking because what you are doing directly impacts one particular company and the future trajectory it will go. A lot of times in banking you will just churn deals where the goal is just get to the finish line. In CD you have a lot of analytic and thought provoking work to prove out why an investment or divestiture does or does not make sense.
Happy to answer any specific questions.
Thanks for the insight, quick question(s)-
Looking at your CD colleagues, and more specifically, those that didn’t start in CD from the jump, what’s the most common background you see? Is it really IB/consulting? Do people get in with odd backgrounds? Do you need experience in the same industry at the associate level and up?
Thanks for the question! I would say majority is IB, PE and Consulting. When you are at a larger company you also tend to see a lot of internal transfers. Some people have come from FP&A, accounting, product etc. When my team sees an internal candidate the biggest question is if they have any real modeling knowledge. If they do, my team is happy to take on an internal transfer from a non traditional background. Industry wise I have seen people from different industry's join our team at the manager and below levels. Once you hit director or VP I have noticed those people tend to have some kind of industry related background.
Hope this helps. Happy to answer any more questions.
How’s the comp progression at your firm?
Unfortunately as with most things it totally depends. My first CD job had huge ranges for positions. We had analysts making 50-75k and other analysts making 125k+ so really depends. Obviously the bigger companies pay better in my experience. At my current company comp is comparable to the base salary of IB but bonus is where we fall significantly short. Also noticed that CD uses stock as a big part of the comp as you move up which makes sense to help align views.
when you say you don’t use a banker outside of 10b+ deals do you mean for financing or advising? if advising how do you feel comfortable getting in an auction process, etc without a banker who knows the space well and has seen countless similar txns
We do not use a banker for advising and this was meant on the divestiture side. The VP's and MD's on my team all come from BB IB groups that covered this specific space and have the industry knowledge. Additionally our product and business teams have a good grasp of their business and can speak to it very well. Think of corp dev as in house IB. We still run active auction processes where we will do out reach to a list of companies we think could be interested and share a teaser and fire side chat. From there we will do IOI's and then commence the diligence process. I guess the short answer is the people leading the team have extensive IB experience and know how to lead a deal. If they ever had questions or needed some insight they are all still pretty well connected and could call a buddy to get some insight. Hope this helps!
Hit or miss depending on company. Some are much more impactful like the above to posts highlight, others (especially in tech) are basically gatekeepers, filters and sourcing pipelines for product teams with execution thrown in.
What is the total comp progression like for CD at Fortune 500 and Job title?
Hit or miss but echo what many above me have said. On my team, if you can handle it there will be work / responsibility given to you. I was provided the opportunity to be in just about every aspect of the deal process from helping with research and diligence, deck making for CEO / Board presentations, in the room when we were presenting (never had a part myself, but during QnA sessions my team would deflect questions my way if it was on a particular piece of diligence I ran with), term sheet and contract negotiations / reviews with legal, closing and handoff to business.
Of course there are day 0 "relationship" type meetings between CxOs that I'm not involved in but that's about it. I think it is absolutely a tossup company to company. I'm lucky my team views me as a valued contributor and not just a cog in the machine.
Comp and responsibilities will vary a shit ton. For context I have 4 YOE and TC is ~$200k
4 years in corp dev or did you do ib/pe before?
2 year finance program (BO / MO) -> 2nd year spent on a strategic finance team with exposure to corp dev team -> 2ish years in corp dev
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Like I said, I've seen comp that varies wildly, from some tech companies paying over 2x my TC for just a few more years experience to people more senior than me in other functions making a fraction of what I make. I'm in financial services on a pretty acquisitive / partnership heavy CD team.
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