Is Development Finance a garbage career path ?
Hello all,
I hope that all is well,
I’m currently studying Finance at Université Paris-Dauphine, I’ve always liked public policy, politics, because I feel that I can have an actual impact through that (especially that my long term goal is to go back to Morocco) so I’ve had an apprenticeship at Caisse des dépôts et consignations (France’s largest public financial institution) and now I’m set to start an internship at Proparco (another public financial institution)
I’m trying to break into perhaps Infrastructure Private Equity back in Morocco (or Africa focused funds), and I’m wondering if the path I’m currently following would lead me anywhere.. I’m afraid they aren’t really aeen as prestigious or sought after (although they are interesting for me)
I’d love your input on this !
Thanks for reading me
Development finance is far from a "garbage" career path, especially given your aspirations to make an impact in Morocco or Africa. Based on the most helpful WSO content, here’s why your path holds value and how it aligns with your goals:
Relevance to Infrastructure Private Equity in Africa:
Development finance institutions (DFIs) like Proparco play a significant role in funding infrastructure and development projects in emerging markets, including Africa. Your experience with such institutions will provide you with exposure to project finance, structured finance, and the nuances of investing in developing regions. These are highly relevant skills for transitioning into infrastructure private equity, particularly in Africa-focused funds.
Impact and Network:
Working at institutions like Caisse des Dépôts and Proparco allows you to build a network within the development finance and infrastructure ecosystem. This network can be instrumental when targeting Africa-focused funds or infrastructure PE roles, as these funds often collaborate with DFIs on deals.
Perception and Prestige:
While development finance may not carry the same "prestige" as traditional investment banking or private equity, it is highly respected in the context of emerging markets. Many Africa-focused funds value candidates with on-the-ground experience and an understanding of the unique challenges in these regions, such as currency volatility, regulatory hurdles, and political risk.
Positioning Yourself for the Transition:
To enhance your chances of breaking into infrastructure private equity, focus on:
Long-Term Impact:
Development finance aligns with your desire to create an impact. Infrastructure PE in Africa often involves projects that drive economic growth and improve living standards, such as renewable energy, transportation, and healthcare infrastructure. Your background in development finance will position you as someone who understands both the financial and developmental aspects of such investments.
In summary, your current path is not only relevant but also strategic for your goals. By leveraging your experience, building technical skills, and networking, you can position yourself strongly for a transition into infrastructure private equity in Morocco or Africa-focused funds. Keep pushing forward—your unique background could be a significant asset in this space!
Sources: Infrastructure at Canadian Pensions (PSP and CDPQ), Overview of Infrastructure Private Equity, Q&A: Experienced Investment Banking & Private Equity professional in Nigeria, Overview of Infrastructure Private Equity, Infrastructure Private Equity
Bump
Take what I say with a fuck ton of salt, but having interned in dev finance orgs and having had mentors very high up in such orgs I think you can look at it like this:
Pros
- Government hours and benefits
-Strong salary relative to hours worked
-Genuinely cool and impactful work/negotiations (my higher up at one point was meeting one on one with an African head of state)
-Academic culture, less bro culture than mainline finance.
Cons
-Political as fuck. People on this forum complain when someone gets promoted over them with 2% more melanin when half (or more) of the time they just weren't the best candidate... in dev finance they regularly do "interesting" things like "oh we need a Central Asian to run this" and everyone will accept that better candidates will get overlooked.
-Salary is not IB and that difference is magnified as you get higher up
-Academic culture means academic credentials. It is a field where you will likely not get promoted without some advanced degrees (MBA, JD, PHD)
-Sometimes easier to move in from corporate than rise from within. External highers are huge.
Other notes
-if you did do the corporate route Project Finance will be looked at more favorably than IB (again this is just what i've heard)
-Personally I chose the IB route mainly because I will earn more and can likely exit to the policy world in other ways.
Hope this helps
cheers!
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