Q&A: Corp Dev
Hi Monkeys,
Have enjoyed this site and found it very helpful since graduating college and having no clue what I wanted to do, wanted to give back a little with a Q&A. I have noticed a lot of anti banking posts and wanted to shed some light on an exit opp/other opportunity where you can still do deal based work.
Background:
I came from what has been described on this site as a "Super Non-Target" school. We maybe sent 5 kids a year to wall street and had no real career services.
After graduating I went to one of the big wire houses in their wealth management division (MS/ML/UBS). After passing my licensing exams I quickly learned this was not at all what I wanted to do, this is when I discovered WSO. I spent everyday for an entire year reading every forum out there about trading, IB, asset management, PE, RE, and equity research, finally deciding deal based work was where I wanted to land.
My next step was to reposition my career, after networking it was apparent an MBA would be the pivot I needed. I applied and was accepted to a top 30 MBA program. I once read on this site that an "MBA is a 2 year vacation and networking event", I took this to heart and spoke to anyone who would listen.
I ended up doing a fall internship in PE at a search fund. Luckily the founder took a liking to me and gave me incredible exposure. This was my first real deal based work experience, the light bulb turned on and I knew this is what I wanted to do long term.
Fast forward to the end of my MBA program and I had secured a full time roll in M&A consulting at a Big 4 firm. This was an awesome experience and taught me a lot about how to think and really improved my excel and ppt skills. Although many people will tell you that consulting is great hours and decent pay, I did not experience that. I was easily working IB hours and getting paid public accounting money, not a good combo.
After doing my stint there I decided going to a large IB for more of the same in terms of hours was not what I wanted to do. I decided to go to a small regional IB thinking hours would be better. Although the hours were better, the firm was an absolute joke, no deal flow at all and I spent all my time doing nonsense regulatory consulting work the firm also offered. After the second day I saw the writing on the wall and decided to start applying elsewhere. This was right when COVID kicked off so needless to say no one was hiring. It took me six months to get out of there and laid a Corp Dev role.
My first CD role was with a tech company on the east coast, publicly traded with about 60k employees. I instantly fell in love with CD. It is the kind of job where you are doing thoughtful and impactful work right away. I was early in my career but had facetime with the CEO/CFO/Heads of Businesses on a daily basis. CD allows you the ability to work on deals but also really learn and understand a company well. In terms of comp I would say base is on par with the respective IB job title but the bonus is not even comparable. Hours wise it really fluctuates, if you are on a deal expect to work IB esk hours, when you are not on a deal or working on less time sensitive projects you can easily work anywhere from 15-40 hours, yes there were weeks I clocked 15 hours of actual work. Recently moved on from that company and went to another TMT company. Gonna speak less about that one for anonymity sake.
Happy to answer any questions you all may have!
Thanks for reading!
Thanks for doing AMA! What's your next move in terms of your career path?
Sure thing! I actually really love the CD work. I think it does a great job of avoiding the monotony that regular FP&A or accounting type corporate roles have. The work life balance has also really sold me. Its given me time to pursue other things outside of work and corporations are pretty good with flexible working compared to consulting firms or banks. I think another interesting side to CD is the notoriety it brings you within a company. What I mean by that is most companies regard CD as a highly skilled versatile team, that allows you to move around in your company if you so choose pretty easily. So long term I hope to continue to move up the ladder in the corp dev world!
1. Comp at Corp Dev role?
2. How comparable is CD pay at large corporates vs. VC/PE backed companies?
3. I know Corp Dev roles can just be "deal guys" at some companies, have you found variation in your two roles - one focusing more on strategy/partnerships vs. add-on acquisitions? etc.
1) Comp is totally all over the place unfortunately. Had a buddy who was an analyst in a HCOL area who was making 65k base (extremely low) and had another analyst on the team making 125k base. If you are at a larger publicly traded company or PE backed one I've seen comp pretty in line with bases at the BB banks for the respective position. Again bonuses vs banks will be almost not comparable. In terms of bonus at corp dev I've mostly seen analysts in the 10-20% range, Associates in the 15-25% range, managers in the 20-30% range and directors and above anywhere from 30-50% range. Another form of comp outside of bonus I have seen is equity.
2) I think CD pay at PE/VC companies vs large corporates is pretty comparable. I have a few friends at PE/VC backed companies and their pay is in line with what I get at a corporation. Will note that I have seen both sides of the coin when it comes to working with PE/VC backed companies. Some people say it is great and brings you a lot of "clout" when speaking to targets and others say the PE micro manages them to the point of impeding work.
3) In the CD roles I have had I have always been a utility player. What I mean by that is I have done everything from operational strategy, product strategy, divestitures, acquisitions, JV's and partnerships. I think where you see more "deal guys" is at PE backed companies. They tend to put a lot of capital behind a company and grow inorganically. If you are at a large corporation you tend to play across the spectrum of M&A and strategy.
What is the general comp level for the most senior CD roles?
What is "good" mid-management comp in Corp Dev? Manager/Director level specifically. Currently making ~$120k as an associate in my 3rd year out of school so next step for me is mid-management that people usually get post-IB. Is $200k realistic before equity
Depending on where you are located (HCOL vs LCOL) I think 200k for a manager position base + bonus is realistic. Honestly I think the 120 is a little low for your experience especially if you are in HCOL area.
Do you ever think how things could have turned out differently if you discovered WSO when you were day 1 of freshman year
haha fantastic question. I think the answer is absolutely. When I started school my parents were pushing me down the lawyer/doctor route and being an 18 year old kid I had no idea what I wanted to do. If I found this site earlier I think it would have been a much easier process to get where I am today. I definitely took the long way to get here and hit many speed bumps along the way but I think that has taught me so much.
Happy to answer!
1) I think this sentiment is correct. VP's of CD live pretty good lifestyles, good comp, great hours and for the most part are managing relationships more than doing in the weeds deal work. I absolutely agree that people use CD to set themselves up for other positions in the company. CD will give you such wide exposure to all the different business lines in your company and the C-Suite that when it comes time to put a new leader into one of those lines you have a good chance.
2) Personally I see myself staying in CD for the longer term, there's something about doing deal based work, shaping the growth of a company and having the inside track on all the decisions that makes the job very exciting. Happy to give some perspective on setting yourself up to go into a different avenue of the company. I have seen many of more senior peers who have hit the ceiling in terms of promotions network extensively, it usually starts by discussing with the business line a potential acquisition or partnership. That is the intro to the business leader and also gives you the perspective on what that business does and if it is something of interest to you. Secondly you can quickly identify the holes and problems with that business line by speaking to the management. They will be able to explain the short comings and where an acquisition could benefit them. From there the CD team member will start to look for potential acquisitions to help improve the business. Once one has been identified and closed the CD team member will ask to help integrate that business, from there they become very valuable as they know the people and the processes of both companies. Due to this knowledge its a bit of a natural fit, assuming the business leader likes you, to hop over to the business side. The other way I have seen it is the CD member will voice that they are interested in XYZ business and will slowly start to specialize in that area in terms of M&A. Once an opening becomes available the business leader will be more inclined to add someone who knows the business.
3) This is probably one of the most frustrating parts of CD. At large corporations there are literately 8 layers you have to go through. As you could imagine in an active auction process this pretty much kills your competitive ability. Generally it comes to CD, goes to a business, business sponsors it, goes to head of segment (what the business rolls into), goes to CFO, goes to CEO. CD acts as the gate keeper and sometimes has the ability to kill a deal on the spot if they feel like it is outside their strategy, other times all deals have to go to the business for review. Once the business sponsors it, the valuation and M&A type work begins. The hardest part I think is getting the segment lead and CFO to sign off. You have business lines that get very excited and want to make their business better but a lot of bureaucracy that stops that especially for M&A.
Not the original poster but will add my two cents because I want to opine on question #2. I think it is an underrated aspect of CD.
1. Yes, I have noticed Director is where many people tend to stall out in the corporate world CD or otherwise. Like you said once someone hits VP level they are generally committed to the company for the long haul and it usually takes retirement or a C suite job elsewhere for them to move.
Additionally, unless you are an absolute rockstar many firms are hesitant to look internally for CD VP hires. Not sure if it is a grass is greener type phenomenon but just something I have observed. What I have seen many Directors or Sr. Managers do is move downstream to get the VP promotion.
2. Unless you are executing a roll up strategy I think all CD professionals should be positioning themselves to move to a role with P/L ownership. This is especially true if you have CEO / COO aspirations as P/L experience is more valuable then CD deal experience at most firms.
I think being at the right company makes a world difference in making the jump to a GM type role. If you are a CD professional at a tech company there is a very low likelihood you will be able to make that jump as you don't have the technical experience. Unfortunately I am still working on making the jump myself so can't add too much advice here but from what I have been told it is all about networking and raising your hand when the opportunity arises.
I have a question regarding how to break into CD. I’m currently in corporate finance in an FP&A position. How realistic/common is an FP&A -> CorpDev jump. I’d appreciate as much insight from personal experience as you can share. If you’ve personally seen it happen, at what levels, how often, what are the common reasons they are accepted/rejected, etc.
I have seen this done before, in fact at one of my companies we had a senior analyst and a director who were former FP&A from the company, they switched internally. On that same team we also had someone who started in sales with no M&A experience come on as an analyst. I think its very company dependent. The company I used to work for had a leader who was more interested in the person and their attitude and thought you could always teach the technical skills. Coming from FP&A I think early on its good to somehow get exposure to that team, this may not be a common opinion but I always like the idea of being open and honest with your manager and telling them you would love to work on that team one day. FP&A (especially if you are the corporate FP&A and not line of business FP&A) has a decent hand in the work CD will do. They are essentially the finance experts of the business, by letting your manager know you have an interest in that area they may be able to staff you on some of those projects. Another avenue is network internally, I'm sure your bosses boss or another more senior member you work with knows someone on the CD or strategy teams, from there I would ask for an intro and have a conversation about what they do and express your interest. In terms of skills you have I would say have some kind of foundation to modeling, a wall street prep or wall street oasis type program should do the trick. I taught myself modeling from one of these classes. That way you can have a conversation and if it turns technical you will be able to handle yourself as well. My last bit of advice on this would be to try smaller companies, I feel like everyone wants to work at the FAANGs of the world and they get tons of applicants, by applying to smaller companies you will probably learn more and also have a better shot. Hope this helps happy to answer any specific questions!
Thanks for the AMA!
Do you know if m&a consulting right out of undergrad would also be a good avenue into corp dev? I imagine it'd give worse odds and perhaps take longer than banking, but I hope it's still a strong and viable pathway.
A pretty good AMA.
Given my career in M&A (between IB and CD), makes me consider doing one.
Thanks! With all the negative sentiment and sometimes worrying posts people have been making about banking figured we could shed some light on a different avenue of finance! Feel free to piggy back on any of my responses if you would like.
Is it difficult to switch industries in corp dev? I will be working at a Corp dev role full time, but not in my preferred industry.
Thanks for the question! Not in my experience, I have seen people come from all different types of companies and I personally have had interviews/offers from all different industries. I'm sure it helps to have prior industry experience but I would not say required.
Not OP but will chime in.
At the end of the day what my team is looking for is:
If you're pivoting in a more junior role I think #2 is probably more important (you can teach #1 if the candidate has good hard and soft skills). If you are pivoting at a mid-level / senior role then #1 is marginally more important (harder to teach and you don't want to have to hand-hold a director or manager than doesn't know how to get in a room and negotiate with their counterparts).
Would it be difficult to make the switch to Corp Dev from a Corporate banking program or from a financial consulting role outside of M&A?
Thanks for the question. I have seen people exit to all kinds of different areas from Corp Dev. I think having the M&A/strategy and business side experience makes you a pretty well rounded candidate for most jobs. In terms of corp banking, that is one area I actually have not seen people go to. Plenty of people go to the IB side so would imagine you could go to Corp Banking if you wanted to. As for the financial consulting I have seen plenty of people go to that type of role in the Big 4 consulting arms.
Thank you for the response! I think I may have misworded my question a bit. Have you seen people get into Corporate Development from a Corp Banking or Financial Consulting type role?
Thank you for the AMA!
1. How is the turnover for Corp Dev?
2. What are some common exits that you've seen out of Corp Dev?
Thanks for the questions! Turnover is pretty low at the higher levels in my experience. Once you hit that director and above level you have a solid lifestyle and pretty good comp as well. At the lower levels there is a little more turnover. Analysts, associates and managers tend to move companies to move up.
Common exits are pretty broad, I have seen plenty of people go to IB, operations roles, finance roles, P&L roles, consulting and even some go to PE although less common.
Do you think the IB experience to get a Corp Dev gig is required? Was curious if working in Corporate Banking on the credit solutions/lending side might translate to a CD exit after a few years
Thanks for the question! I don’t think it’s absolutely a requirement. If you have the skills that the job require ie. Modeling, valuation, understanding of the M&A process etc. Then I think you’re fine! Not very familiar with corporate banking but if you understand the key M&A concepts I think you’d be fine!
Hey, thanks for the fantastic AMA!
I’m currently exiting IB M&A after 2 years and am looking at 2 offers in CD (different sectors) for an associate level role.
1.) In terms of the hours, I understand that you say it can get as long as IB hours some times, but how often would you say that occurs for you? Also would having a team that hires advisors lessen the workload noticeably? And just wondering if your team is mainly ex-IB people, which I assume may affect the hours and culture?
2.) Would you say there’s a steep learning curve for someone coming from IB for the non M&A aspects of a CD role? (E.g operational and internal strategy — stuff that IB wouldn’t provide exposure to?)
Thanks in advance!
Happy to answer!
1) First it really depends (I know this is the worst answer) on how acquisitive the company is. If they tend to do 1-2 deals a year I would say maybe 3-4 weeks max you are working IB hours. If you are churning deals out then I would expect that to rise. In my CD experience I tend to get stuck working IB hours a weekish per deal. I caveat that by saying once you finish a deal in CD you get a "victory lap" so to speak where you aren't staffed on anything crazy for a good month as a reward. If you hire advisors the CD function really just becomes a middle man. The bank will go to you with questions you will go to the business with those questions and then revert back. In my opinion takes the fun out of the deal. The bank will generally run the model and CIM, therefore you become almost supervisory to the bank. My teams have been a mix. Majority I would absolutely say come from an IB role. I have had some who came from FP&A, sales, internal transfers, accounting, PE, and consulting. I think alot of the ex bankers especially at higher levels are in CD because they don't want to deal with hours or the stress so although things do get to crunch time at some points, for the most part its much more laid back than banking.
2) I don't think there is much of a learning curve on the strategy and operational side. The nice part about corporate is that they hirer people who do every single function. So the strategy team will be the people you pull in when you need strategic help, when you're trying to understand the operational aspect of the business you would pull in the business lead who knows the industry. The best way to describe CD is you do deals and have experts in each field to help get the job done.
Quas omnis tempore necessitatibus voluptatem. Dolores corporis saepe reiciendis qui neque aut placeat. Omnis et libero deleniti. Eum consequuntur omnis cumque rem soluta laudantium. Ut animi ut distinctio nisi rerum provident ex.
Fugiat perspiciatis est beatae magni ea et quae reprehenderit. Aut ipsam voluptas ea in porro. Voluptas recusandae est et placeat magnam eos doloribus omnis.
Exercitationem omnis doloremque hic impedit maiores mollitia placeat exercitationem. Sit sequi animi consequuntur suscipit vitae. Saepe et cum sunt iusto. Et facilis eaque officiis placeat autem dolorem debitis. Eum in est qui consequatur.
Rerum harum sunt ut et dolor iusto nemo veritatis. Aut nam dolorum consequatur corrupti. Et accusantium doloribus impedit totam sed. Voluptatem sapiente qui impedit magni vero. Quam quo voluptas sunt sequi deserunt possimus officiis. Maiores aut repellat veniam dolorem eligendi temporibus laboriosam.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...
Magni nulla porro perferendis. Modi accusantium sed veritatis molestiae est voluptatem. Et nostrum ab asperiores voluptatem.
Rerum repellat quo quis enim quia. Quas aliquid eos culpa voluptatum. Eligendi quod ipsa illum impedit sed.
Asperiores labore quia repellat iusto. Libero doloribus eligendi excepturi quisquam ea. Doloremque ut quos eligendi. Tempore dolor est nisi voluptatem pariatur eius aut. In optio dolores in fugiat aut iste.
Consectetur et quaerat id corporis. Id saepe nemo unde non et unde deserunt. Aut sed rerum nam et. Aperiam dolores nisi dolores tempore facilis alias. Consequatur est natus delectus voluptate labore nihil.