Found the ultimate lifestyle exit op in high finance
I’ve been lurking on WSO for a while, and one thing I constantly see is people complaining about hours and pressure in IB/PE and asking about “chill” exit ops that still pay well. The thing is, most IB analysts aim for PE because it’s hyped as the promised land. People go to PE hoping carry makes them millionaires someday, not because they’re chasing a better work-life balance. But from what I’ve seen (and heard from friends in the industry), PE can be just as bad, if not worse, than IB in terms of lifestyle.
A few months ago, I was exactly where many of you are right now, burnt out and desperate to leave banking. I knew I didn’t want to go the PE or HF route because I couldn’t handle another grind. Initially, I was aiming for Corp Dev and was even okay with taking a big pay cut just to get my life back. But if I’m being honest, part of me didn’t want to give up the “prestige” (yeah, I know, it’s dumb), and I wasn’t ready to walk away from the spending habits I’d developed (also very dumb)
Then I stumbled across a leveraged loans investing seat. I was skeptical at first. I assumed every buyside seat meant at least 60+ hours a week, and I just wasn’t about that life anymore. Plus, the team was all ex-IB from a top BB, so I figured the culture would be toxic, hours would suck, and it’d basically be a lateral move. But I went through the interview process anyway, got the offer, and I’ve honestly never been happier.
I work 40 hours a week, 9-5:30. Weekends? Free. Holidays? No one bothers me. I get to WFH two days a week, and there’s a ton of flexibility. Staying until 7 PM is considered LATE. No joke. The team is super supportive, and there’s a clear path for progression. And yeah, I’m still working on transactions but I’m collaborating with major PE funds and highly acquisitive companies.
The work itself is genuinely interesting. I’m not buried in endless modeling; we just do quick 3-statement models. DD is streamlined because deals move quickly, so I’m not stuck in the weeds forever. It’s intellectually stimulating without the soul-crushing grind. And for the prestige crowd here, yes, I still get to call myself an investor.
I know comp is a big thing for everyone here as it was for me. My base is the same as it was in banking, and while my bonus will be slightly lower, my lifestyle hasn’t taken a hit at all. It’s honestly a no-brainer tradeoff for me. Regarding exit ops I’ve seen people from this team and other similar roles go on to HFs, MM/LMM PE, DL, and distressed debt roles, so it’s not like this limits your career options.
The only catch? Seats like this don’t open up often. Most of my team (associate level and above) has been here for at least 5 years, with the average tenure being 10+ years. I can imagine because it’s such a sweet seat no one wants to leave But I wanted to share my experience because this type of role doesn’t get much love on WSO. If you’re burned out, want a better lifestyle, and don’t want to take a massive pay cut, I’d seriously recommend looking into liquid credit or leveraged loans seats like mine. Happy to answer anything in the comments.
Are you at a CLO manager?
CLO’s are a big part of what we do but only 1/3 of our AUM comes from CLO’s so we have a more flexible mandate.
Marathon?
Thanks for sharing, SB'ed, seems like an interesting role and happy you've found yourself a seat
You mentioned that the work involves "collaborating with major PE funds and highly acquisitive companies", so is it a shop that basically provides the leverage in acquisitions (the "L" in the "BO"s)? What do you think the USP for such shops would be, given that cost of your funding would unlikely be lower than the traditional institutions? Would you then typically aim for targets in the non-IG / underbanked / distressed space? Or is speed of execution your shop's main USP?
Would say I'm in a somewhat similar role but at a smaller shop (ignore title), sector and geo-agnostic opportunistic/special sit investor where we also advise on structuring and some syndication, is that how you'd describe your role as well? And what other companies (across the AUM spectrum) are similar?
To answer your questions: 1. Yeah, we fund LBOs, dividend recaps, M&A, and all that. Basically, anytime a company is highly leveraged or sub-IG and needs financing, we’re likely involved. We focus almost entirely on TLBs, though we do have some FRNs in the mix. Of course, we also handle more straightforward transactions like refinancings, but overall, it’s a pretty diverse and interesting mix of deals.
Our focus is on sub-IG credits, with most of our holdings in the B to BB range (single B being the average). We’re open to CCC credits when there’s a good opportunity, but those are fewer and farther between. Since these loans are syndicated and tradable, our DD process is fairly streamlined, and most transactions close within a week. We do have the flexibility to look at distressed or LME situations when it makes sense, though that’s usually handled by a separate team specializing in those types of deals.
What sets us apart is the flexibility we have thanks to our structure. Only about a third of our AUM is tied to CLOs, with the rest coming from institutional investors and other vehicles. This gives us more freedom to pursue opportunities outside the standard CLO framework. Our speed of execution and flexibility are huge selling points, especially in today’s market. Credit has been thriving over the past few years, so it’s a great space to be in right now, and the tradable nature of these loans makes them particularly attractive compared to more illiquid private credit.
We don’t advise on transactions, but we’re sector-agnostic and opportunistic in our investments, which sounds similar to your approach.
For similar shops, think of the usual players: BX, KKR, Apollo, Ares, and Partners Group. There are also other large asset managers with liquid credit teams, though they’re generally less flexible than we are.
Very cool, appreciate your views. How long were you in your banking seat before jumping to this investing role?
Also (and apologies in advance for the ramble), since you've mentioned the different uses of proceeds, just thought I'd ask - how do you/IC view your facilities being used as LBOs/M&A vs. div recaps? The former (at least technically speaking) providing some form of synergistic value to the borrower and at least within your tenor, the UoP gives you some visibility on repayment; while for the latter, it's purely for LP distributions / non-value-added uses and to be blunt, your facility isn't put to productive use.
Anecdotally, while I'm not US-based, the general consensus view is that facilities undertaken for div recaps or other "non productive uses" are rather frowned upon, lenders aren't typically keen on these types of opportunities, regardless of pricing / any configuration of securitisation. Even as demand for secondaries are on a pretty steep rise (with GPs are looking to divest and distribute asap or risk losing LPs when raising their next fund), I still don't see/hear many cases of div recaps.
Just thought I'd get everyone's 2c on how they get around convincing IC to take these types seriously (personally I'm not a fan of these either and can't find it in me to pitch it to anyone)
Can I PM you?
How do i Get here as an analyst 1 in industry coverage M&A?
I typically see people from Levfin making the move to seats like this given exposure to credit. I think the main thing would be your motivation I’d have a solid story for why credit and why leveraged loans specifically. What worked for me is there is a mix in terms of looking at private and public markets since there is an element of both here. For me networking didn’t matter much, I just cold applied and got lucky but the industry is small and usually you always meet the same people at conferences, or on lenders calls etc so having a strong network I can imagine definitely helps.
Thank you for your response this is super helpful! As a follow-up, do you have any recommendations for resources or tips for for how I could learn more about the credit markets and prepare for these interviews? I work more with TMT m&a so don’t get too involved with debt on a day-to-day, but interested in breaking into this space
I’d start with S&P’s Leveraged Loans Primer. It covers everything from covenants and legal terms to the typical uses of debt, and it’s a great way to get familiar with how leveraged loans work. If you have access, I’d also recommend reading ratings reports from the agencies. These are helpful for understanding how companies are assessed and what factors go into determining creditworthiness. If you have access to equity research platforms, dig into their credit market reports as well.
From a technical perspective, you likely already have the modeling skills from M&A. For credit, all we typically do are straightforward 3-statement models. I’d focus on practicing scenarios like changes in leverage, interest rates, or EBITDA declines. Make sure you’re comfortable calculating credit-specific metrics like net leverage, interest coverage ratios etc they’re super straightforward but critical for interviews. Also think logically about certain line items in the FS, some stuff matters a lot of for the equity story but means nothing for credit. Really apply the logic, that credit is all about assessing the downside so take this into account when practicing.
Beyond that, it’s important to understand loan and credit structures. Get familiar with the concept of cov lite loans since they dominate the market, and understand the trade-offs compared to more restrictive terms. One thing I’d emphasize is the legal side it’s often overlooked but hugely important in credit. If you have access, read a few term sheets or credit agreements. Anything you don’t understand, throw it into GPT or look it up to build your knowledge.
Hope that helps!
Following
Buddy’s life is about to get wrecked when the domino of PE assets inevitably start tumbling and the game of chicken commences.
The update in 1-2 years will be interesting.
could you expand?
What makes you say this? Market seems solid at the moment and fundamentals seem great from what I’ve seen. Cap structures are super flexible (I’ve only ever seen cov lite loans) plus don’t sponsors have a crazy amount of dry powder at the moment, there’s so much flexibility that I can’t see a chain reaction of defaults anytime soon.
This comment is unintentionally hilarious, man. Cov lite is not a good thing as a lender. Instead of having any type of recourse, you watch in vain as your paper trades into the 70s, 60s, 50s… only to get bent over and LME’d by Oaktree.
haha PE dry powder does not equal a backstop for highly levered portcos. Lenders to PE backed companies don't have recourse to PE dry powder. Cov lite is great until it isn't. today the market is fine, but the stress of high rates + economic pain is a recipe a for disaster. Almost certain that some sectors are going to get smacked at some point in Trump admin.
10yr bonds going to 5-6% is going to rattle the shit out of PE, but for distressed finance situation players, it just ups the vig even more, so he will be fine
ups the vig, but increases credit risk. given current "free" capital environment...not sure if an extra 150bps is worth principal impairment
.
This aged beautifully.
What is your role called? Or what would someone have to relay to HH or search on LinkedIn to find similar roles?
My title is literally just analyst, but I’d convey that your interested in liquid credit roles a lot of the MF’s & UMM funds have liquid credit divisions. Most large traditional asset managers also play in this space although comp may be slightly lower (except for a few firms). There’s honestly so many firms that I could list that are in this space so I’d recommend just doing your research but notable names are: BX, KKR, Apollo, Oaktree, Carlyle Group, Bain Capital, Partners Capital, Hayfin, Antares, Irradiant, Ares and many many more. These teams are usually pretty lean though (most deals are handled by a single person for example - very rare for two people to be working on a transaction unless it’s someone really junior).
Main thing emphasise your interested in liquid credit (or say leveraged loans investing) and not private credit which is different and tbh more hours.
Can you elaborate on how your role (liquid credit/leveraged loan investing) is different than private credit? Lots of information online on private credit, but not much on how liquid credit/leveraged loan investing is different.
Can you give examples of similar firms to yours? I am incoming analyst at a MM in LevFin and always figured I would look for seats in CLO investing after my analyst stint but this seems like it could be a viable option as well.
Most established buyside shops have teams like mine although they’re pretty lean and seats rarely open up. I’ve given some examples in previous answers here but heres a list of names I can think of the top of my head: Ares Management, Blackstone Credit, Apollo, Oaktree, Barings, Invesco, Bain Capital Credit, Carlyle, Hayfin, BlueBay Asset Management,ICG, Alcentra, Antares Capital, Nuveen, TCW Group, Voya, KKR Credit.
My shop manages about 20 bn or so in this asset class.
It’s great that you found an exit opp and yes the lev loans desk can be a pretty attractive place. No place is perfect and lot of the BSL shops are getting hammered right now. Not to mention you are basically naked on terms for every deal and returns are thin as hell in the space, but i imagine you get some fund leverage somewhere.
Shit really goes to hell when LMEs come into play and you’re not in the ad hoc group. Sounds like you are mostly operating in healthy credits, so that’s good.
But the sponsors are bending you over and these docs are loose as a goose.
I still haven’t fully figured out who is the dumbest among
- Private credit
- Secondary
- Middle East funds
It’s actually funny when you hear some PC guy at RX situation saying “we thought we had equity cushion” as they are about to take 15 cents on the dollar.
Forgot about VC Silicon Valley investors
Can I DM u?
Is it possible to break into these types of roles from PubFin IB?
Nothing is impossible, but it might honestly be an uphill battle since I imagine you mostly focus on low risk highly rated issuers which is quite different to sub IG private companies. You probably focus on things like the strength of tax bases, project feasibility, and government guarantees, which are generally very stable and predictable. Here, underwriting is focused on downside risk, things like how much debt a company can handle, whether its FCF is sufficient to cover interest, and how sensitive it is to changes in EBITDA or market conditions. The businesses you’re looking at are just so different. Then again you can always frame your story in a certain way, maybe join as an analyst and cover the infra/construction space where I imagine your skillset does fit in. Maybe a way you could do it is infra debt at a large AM and transfer internally to a team like this but I see a direct move being difficult just my 2c.
Can I PM you? Currently work in LevFin U/W credit team at BB think GS/JPM and was interested in learning about if this is a seat I could transition to
My area of pubfin couldn't be further from how you described. We deal mostly with high risk, below IG/non-rated borrowers. Also revenue bonds as opposed to general obligation, so no gov't guarantee guarantee nor taxing power. A lot of what you described as your underwriting focus is very similar to what I do (in the HC vertical)
Thanks for sharing, but you have barely been there. It honestly takes 6 months to see any immediate red flags, and a year to get a good view of where you are.
Personally to me that decent
i come from a background where 14+ hrs shift is a norm and that too almost everyday of the week. if we are lucky and the work load isnt enough we would get one day rotational off and guess what it doesn’t pay overtime or by hr, its fixed salary no matter how much you work.
its better for me to use that time in some career which will pay me for the amount fo work i have done not on daily basis.
leader in my country are in fact asking us to work 90-100 hrs a week at same pay as 40 hrs a week.
Does your team focus solely on leveraged loans through CLOs and other funds, or do you also invest in high-yield names? I’ve noticed firms like Apollo tend to cover a broad range of credit.
We honestly do a mix of everything. LL’s some HY FRN’s, even DL/Distressed deals although they are pretty rare. We have the flexibility to look across different type of transactions provided it’s SS (even then we sometimes touch Junior debt depending on the opportunity). Worth noting the more complex transactions are usually handled by more senior associates/VP’s so a junior like myself will only work on BSL’s.
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