My experience moving from IB M&A to Corporate Finance: Pros and Cons of this Exit Opp

Left MM M&A IB after 2.5 years for a corporate finance (associate-equivalent) role at an F500 company, and just wanted to share some info for people who might not be aware of this exit opp (since PE and CorpDev seem to be the only things that people think exist post-banking).

There really doesn't seem to be that much information on corporate finance roles because it's such a broad category. Unlike many FO IB roles, there aren't neat boxes where you can say "I do XYZ in ABC group, covering the 123 industry". Corporations hire for as broad or as narrow of a role as they please, and often times it's not easy to put them into a specific box since each company is different. 

To try to specify what type of role we are talking about:

Corporate Finance, typically at a mature F500 corporation that is involved at the corporate level the financing and strategic needs of the business on a consolidated level. That's jargon for "I model the 10-year projection period for the company". We model the financing needs of the company, meet with bankers to get updates on the capital markets, run scenarios on the impact to EPS, work with equity research to clarify expectations on the street, and work with credit agencies to model out our financial risk profile. Within this, analysis will be done on buybacks, alternative sources of financing, liquidity management, and dividend policy. Sometimes we'll run analysis on asset divestitures and analyze opportunities for M&A, but are not solely focused on corp dev since it's more opportunistic rather than used as a core growth strategy.

FP&A?

This might be compared to FP&A (which is what turns some people off) but I would say the main distinction is that operational FP&A at the business unit level is very focused on the near-term budget year. As a result, the modeling focus is on minutia where the inputs / data borders on financial reporting rather than financial analysis. In other words, there is no big picture analysis of the company as a whole and where the company goes in the future, in terms of market positioning or financing since the goal is to make sure the next 12 / 24 months are budgeted accurately. The period is near term enough that there is observable support for these projections, so it becomes very granular very fast in a way that isn't necessarily intellectually stimulating. I play a small part in this budgeting process sometimes, but typically I will receive these as outputs from the business units so I don't do much budgeting at all.

Strategic Finance?

This is basically strategic finance but I don't use the term since the role has been co-opted to be more synonymous with start-ups and "hip" tech companies. Due to the operational and financing needs of these companies being a bit different from a mature blue-chip, I distinguish from this term since those roles can encompass way more operational aspects, be more strategy oriented than finance focused, and typically are a bit more sweaty.

Corp Dev?

Not really, since M&A is much more rare for certain types of large blue-chip F500 companies. You'll have large corporations that have dedicated corp dev departments, but these are much more focused on strategy and ad-hoc projects rather than the day-to-day corporate financing. M&A seems to come very occasionally, so you'll be able to whip out your M&A knowledge toolkit from time to time, which might be a nice change of pace. And of course, you'll probably have an IB doing the nitty gritty transaction work for you, so that's a nice plus and counteracts any potential WLB of being in deal mode

Okay, now that I've laid down what this job is - the long and short of it is:

-Pay is good relative to working hours but progression is slower and is heavy on equity comp in future years: With 3 years of experience, I'm making about what a 3rd year analyst would make (around 185k all in). There are probably 3 people between me and the CFO, so it would probably take me 3-5 years for a promotion depending on circumstances (potentially longer) and how I play my cards. I would project that ~300k wouldn't come until ~10 years down the road. Benefits play a huge part of overall compensation, and 401k match / strong health coverage / other free shit is something to consider. Overall, I'm happy with this pay though because the days just fly by and it feels like I'm making bank since a workday comes and goes so quickly, even if I'm making less.

-Work life balance is great, 40-50 hour work weeks, maybe 65 at worst: Corps really do move at a slower pace and timelines aren't artificially shortened like they are in IB. You'll typically work with older folk who have kids, and as such they're not interested in working all day on Sundays. That said, most of my managers are ex-bankers so they'll still have the level of scrutiny that you might have in banking, just with less of a ridiculous time pressure. There are days where I get like 5-10 emails max for the whole day (no joke). Deliverables are predictable and typically contain analysis that makes sense. People are generally a lot more relaxed and nicer as well

-Actually doing finance shit: if you enjoy doing financial modeling and the actual finance part of banking, this might actually be something you'd enjoy. Certain bankers like the "strategizing" of M&A and working with counterparties on transactions rather than the excel modeling. This job is probably not for you in that case. But if you dig being able to run scenarios on a 3-statement model and run analyses on cost of financing, this job comes pretty naturally.

-How to find these roles: Focus on roles that are specifically at a consolidated corporate level that are not FP&A budgeting oriented at a business unit - typically it's focused on strategies regarding sources of financing, dividend policy, accretion / dilution analysis, and prefer banking experience. You can also search for strategic finance as a potential indicator, but I would confirm it is a mature company rather than a start-up or early stage company. Typically, other employees in these roles will be ex-bankers.