Exit Options
Hey guys, out of curiosity, what percentage of your IBD analyst class do you think are gunning to go into (1) PE, (2) HF, (3) straight into b-school, (4) continue with IBD through associate program, and (5) other (startup, med school...)?
My guess would be (1) 50%, (2) 20%, (3) 10%, (4) 10%, (5) 10%
bulge bracket TMT group
(1) 60% (2) 10% (3) 0% (4) 10% (5) 20%
Almost everyone is really gunning for PE, a few VC / startup kids and a random HF kid or Associate promote here and there. Have never personally seen someone go from IBD analyst straight to B School. The exit opps from analyst are good enough that it doesn't really make sense to reinvent yourself by going to 2 more years of school that early in your career.
Thanks fryguy22. Why do you think such a significant number want to go into PE? Is it more, "that's what everybody else is doing/has done before me/much less risky than HF" reasoning? Why don't you think more gun for great HF options? I'm surprised why more don't go into HFs. I wonder if it's because most of these kids entered these programs not genuinely interested in investing.
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Bankers choose to go into PE because, and this is in general mind you: better pay, better hours, better lifestyle, better work than banking. As I prefaced, this is highly dependent on whether you're going to a smaller shop or a megafund or anything inbetween. Megafunds generally work more hours, get better pay, whereas at a smaller shop your pay might only be a little bit over banking pay but with better hours. The better work as well is conditional on your own preferences, but most people would probably agree that evaluating investment opportunities and helping management with growth opportunities beats out writing CIMs and formatting pitchbooks. And yes, like you mentioned, it's a fairly safe and established path for ex-bankers.
As to why more don't go into hedge funds, it's most likely because there are less positions available, especially with a banker's skillset. Many hedge funds that are quant based aren't looking for bankers to begin with. Many exceptions as well, but hedge funds typically don't do long-term, controlling stakes in companies, so it's a different type of investing that may not appeal as much to certain individuals.
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