Financial Sponsors vs. traditional M&A for PE?
I am at a target school and plan to recruit for IB next Spring/Summer. I still have a good amount of time to figure out what exactly I want to do and where to recruit, but I have a good idea that private equity is where I'd like to end up long term. Do you think financial sponsors or traditional M&A prepares you the best for PE? For the former, I've read and heard that CS/BAML is who I should focus on, and for M&A I've been told MS, EBs like Evercore/Moelis, any GS classic group, and a lot of others like Citi, JPM, Barclays, etc. It seems like a wider net for M&A. I am really open to going anywhere, I just want the best experience to prepare me for PE. NY is typical based on where my school is located, but I am open to California as well. Thanks in advance for any advice.
Get an offer first then talk
I mean I feel like this is a pretty valid question? They’re wondering if they should focus on one area vs another for recruiting, not like they’re just debating between CS and BAML.
I’d see if you can get in touch with any school alumni who have been through Sponsors at various banks. I know at WF their Sponsors group is very strong and their placement rate for PE is close to 100% and they get really involved in the modeling, but at GS what I’ve heard is it’s more of a relationships group. Seems to be pretty heavily bank-specific. Tons of people in M&A successfully transition to PE, but Sponsors at the right bank would be more directly relevant to the PE recruitment process.
can you speak more about WF Sponsors? Didn't know the group did that well.
I spoke to 3 people there - two of them were 2nd year analysts and were leaving for PE this summer, one of them was a 1st year and currently interviewing for PE now (to theoretically leave next summer if he gets an offer). From what they said, it's a small group and basically all of the analysts who come in transition to PE. Which makes sense, because working in Sponsors you're directly building relationships/knowledge of those PE firms that you'll be interviewing with starting just a few months after you get to the Sponsors desk.
Not an expert but if you go the sponsors route you might want to ascertain if it’s at a firm where a lot of the modeling is done in FSG rather than LevFin. Following this thread.
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