Ideal Background for RX/RX Consulting?
Hi everybody, I’ve been looking into recruiting for RX/RX Consulting recently but it seems like a bit of a black box. For context, I worked at a boutique bank my freshman summer on a deal with a distressed company and worked at a boutique management consulting firm my freshman spring. I had a few questions that I couldn’t find answers to:
What background is ideal for RX candidates? Is strong experience with modeling and debt preferred? how technical is RX consulting compared to RX in banking? Beyond the 13WCF, what other skills are commonly tested? what is recruiting like for firms with RX practices? For example, how selective is Alvarez & Marsal’s RX consulting group? what’s the best way to prepare for RX interviews beyond the restructuring section of the IB 400 guide?
Apologies if I messed up some of the terminology, I started looking into RX recently and I’m still learning. Would really appreciate any insight on this!
Based on the most helpful WSO content, here's what you need to know about recruiting for RX/RX Consulting:
Ideal Background for RX Candidates:
Technicality of RX Consulting vs. RX in Banking:
Skills Commonly Tested:
Recruiting for Firms with RX Practices:
Preparation for RX Interviews:
For more detailed discussions and insights, you can refer to the following threads on Wall Street Oasis: - https://www.wallstreetoasis.com/forum/consulting/how-is-am-perceived-in…</a">How is A&M perceived in the industry? - https://www.wallstreetoasis.com/forum/consulting/how-is-am-perceived-in…</a">Top 5 Restructuring Consulting Firms 2020 (my opinion) - https://www.wallstreetoasis.com/forum/consulting/how-is-am-perceived-in…</a">Alvarez & Marsal RX 2022 Reputation/Exits?
These resources should provide you with a comprehensive understanding of what it takes to succeed in RX/RX Consulting.
Sources: Top 5 Restructuring Consulting Firms 2020 (my opinion), How is A&M perceived in the industry?, Alvarez and Marsal -- Restructuring and Turnaround Consulting, How is A&M perceived in the industry?, Advice on recruiting for Rx groups Post-MBA
For the consulting side- know typical technicals you would need for traditional IB. Understand what a 13 week cash flow is philosophically/what it is used for.
For restructuring specific knowledge I still think restructuringinterviews is the best resource, even though it is not directly applicable and overkill for the consulting side. It is still helpful and the knowledge will be useful even if it’s overkill.
Just as an FYI, a lot of these shops are weird about not taking fresh grads, as in they prefer candidates with one or more years of experience. There might be a few that do, just something to keep in mind.
As to skill set and interview prep, you’ve got the right idea and second the restructuringinterview guides, those are good resources. Consider getting a 13WCF course - this won’t have modeling nuances beyond building a direct cash flow, with working capital, borrowing base and bridging to an indirect cash flow or ebitda. Expect the technical portions of interviews to be similar to rx banking with emphasis again on working capital and cash flow. Further expect questions about the restructuring landscape and you’ll want to spend time researching a deal. Most of those will have some kind of case study to close it out. Hope this helps.
This is just not true. Every major RX bank takes undergrads as interns and analysts. Know the same to be true with A&M and FTI. Examples of banks which take undergrads as RX specific interns and can convert to full time includes: PJT, EVR, HL, Ducera (although labeled as generalist, they are an RX bank), Gugg, CVP (RX Major M&A minor), Greenhill, Laz (CHI is rx specific, NYC generalist). May be more I am missing.
Generalist internships which can convert to FT RX include Moelis, PWP, Roths, Jeff (I think though could be wrong), Piper Sandler. Again may be missing some but trying to show that above is wrong re needing a year of exp
Previous poster was referring to Rx Consulting, not banking. They are definitely correct that most Rx Consulting shops do not hire directly out of undergrad, it may happen from time to time, but it is rare. Rx Banking does hire out of undergrad.
For advice, I would recommend taking a 13 week cash flow course. If you have a basic understanding of that and three-statement modeling, you should be set for most consulting modeling interviews or case studies. The banking side will likely have more of a classic IB LBO type case study or modeling test. I agree with others that restructuringinterviews is good, but likely overkill for the consulting side and probably more applicable to a true Rx IB (not just a debt refinancing IB shop), but still great general topics to learn.
What is compensation like for A&M/FTI RX consulting for someone with 4+ years of experience?
Depends on what level you come in and the firm. A&M/Alix have more aggressive bonus structures that allows you to hit up to ~100% bonus depending on billables. FTI usually has a higher base salary but is more conservative with its bonus structure. You can reasonably expect a 20 - 30% bonus (including the quarterly CHIP) at FTI.
A&M is much more likely to start you off as an analyst — even with 4+ YOE — while you may come in as a SC/Director at FTI depending on how relevant your background is. Hope that's helpful!
Source: interned and starting at one of these firms.
A&M and FTI take directly out of undergrad, don't think I've seen it happen for Alix. Work background doesn't matter too much for entry level. Ideally you've done an internship or two in something finance/consulting related. You should know how to build a basic 3-statement model, and you should know some basic working capital topics (AR/AP/Inventory, how these get modeled and how they affect cash).
Know a guy who went slick full time out of undergrad, stud from Columbia tho
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