Those who left IB as a VP - was it worth it in the long run?
Understood there are a lot of factors at play, but interested to hear from former IB folks who left as VPs whether it was worth it in the long run.
Information is out there about the short term implications of making a move to something like business dev, etc, but I’m interested to hear the long term effects of people who took that path. My mentality has always been to stay in IB as long as I can stomach it (for the short term pay), and figure out the optimal jumping off point as I go. I’m stuck in the mindset that leaving for corporate is analogous to “giving up” on my career… did others who took the jump feel that way? Did IB set you up for long term success?
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Currently a VP2 but my goal is to trade down bank tier every 2-3 years if I don't get D. Hoping I can go from BB VP -> MM SVP -> LMM MD and by that point I would have collected enough checks to leave the industry and do a cushy 9-5 towards the end of my career
Quick question - how long did it take you to get to VP1? just curious as i have a similar thought pattern of "trekking it out" at the "higher ranked" banks until late VP/early director and trading down for D/MD.
3 years as an analyst and 3 years as an associate. started in ib pre-covid
Does moving down the ladder necessarily mean better hours? I've seen plenty of middle market senior bankers with horrible work life balance. They scrap for every dollar of business at firms that lack resources or name recognition
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I left an EB as a VP, even after I was told I'd be getting promoted to ED. I generally agree with your mindset of milking it as long as you can. The VP/ED years in IB are pretty great, lot of money for often reasonable hours.
In my case it was worth it because I have such an extreme buy side bias in terms of how my brain works, that even a lower end PE role (I do small deals at a medium sized family office) or an unglamorous corp dev role is something where I can succeed better than I would as a banker. I knew I wouldn't compete well as an MD when I don't really believe in what I'm selling.
Luck plays a role in everything, but IMHO the one non-luck factor you can tilt in your favor is to do work you'll be good at. And I saw a big difference between client service and buy side in terms of whether I'd be good. For others, those roles might be more similar to one another. Think hard about your personal edge over others and find ways to exploit it.
How difficult was it to find a buyside role as a vp? I would love to transition from lev fin to private credit at a similar stage in my career (I'll be promoted to director in February), but I only know very few people that have made this leap
Hard yet easy, in the following sense.
First I tried the traditional routes (PE recruiters) and they straight up told me it wasn't going to happen in a traditional well-known PE shop. They said work my own network. At the time that was rough to hear because you're going from hoping to be out in a few months to suddenly, oh shit, I need to build a network now.
But that ends up being easier than people think. It's one of those things where trying to do it fast slows you down, and trying to do it slow speeds you up. Like slowly building real connections with people, you'd be surprised how quickly someone spots your passion and says hey I know someone who'd love to have you. But if you try to rush it like so many, and build lots of superficial connections (the guy on LinkedIn who's always trying to "connect"), I think there's a good chance you get nowhere. I just told friends that I'm good for now in IB but hoping to eventually move, and it wasn't too long before a few of them knew of smaller PE shops looking for someone.
can you explain your mindset and the pros/cons you listed between buyside (fam office) and IB and what criteria you listed that shifted your favor and decision to leave IB? im thinking IB is more client services/salesy and slightly easier promotions since theres always a need for bankers but buyside promotions and moving firm to firm is harder. just curious how you went about the decision.
For me most sales jobs, including IB, feel like the tail wagging the dog. Like we're pitching a deal not because the deal creates value, but because we need to eat. That makes the entire process painful for me. I hate having to constantly push against forces like economic reasoning and common sense. How am I supposed to get fired up every day and compete to be the best in that world if I don't even have conviction in what I'm saying or selling.
I'm effective when what I'm advocating makes so much sense that I'll just keep pushing relentlessly. Like XYZ investment is undervalued, if you can't see it then I'm going to just push even harder because (i) I've done the work and I know it's undervalued and (ii) I'm fueled additionally by your arrogance (you being an LP or boss or whatever) in saying this investment isn't a great idea when you haven't even done the work or thought properly about it like I have.
So the mindset is basically, what work will provide automatic motivation vs. work that will require me to keep digging for motivation.
There is a theoretical IB role where I'm only pitching deals that naturally occurred to me because they made a ton of sense, and that would be interesting for me. But I'm not sure if those roles exist in reality. I guess once you've been an MD for a while and made a fortune you can focus on only the deals that should really happen.
Hope that answers your question but lmk if not.
Just curious, is that your real name? Or is a reference flying over my head
Not my real name. Just wanted a random name for WSO use and was feeling in a vulgar mood.
10+ years post MBA. Have seen only one situation where the guy cleaned up. Became CFO then CEO of a forgotten / stuck business (not PE owned) that sold to a strategic for $2bn+. Making million a year is nice. Making $50-100mm at once is nicer. Have seen some situation where people moved on to Corp Dev role but kind of stalled out especially if company sucked. One took a CFO job at growth company in 2021 thinking some IPO riches that never materialized. Guess we still got 20+ years of work life left so lot can still happen.
how was your journey? are you still in IB? curious what/why of the career you're at now. trying to figure my life out as well
As someone who routinely contemplated/have friends who have contemplated similar options and still continue to, here are some thoughts. The reality is: there is no "optimal" jumping time/path. All depends on what you eventually want to do. It always helps to have an exit plan in place from banking, given how volatile things can be across the years + personal situation.
1. If you are aiming to exit to a PE, you are significantly worse off as a VP in banking compared to an Assoc: very little need for banking VPs being hired for VP role at PE. Unlikely to happen (but maybe it does on a very limited scale)
2. If you are aiming to exit to a MM / LMM PE - possible, but really the question for them will be: what value add can you bring as a VP? You clearly understand execution, but the real value add for them to bring people on is in origination i.e. can you originate deals with a local HVAC company or a regional fabrication manufacturer? My contacts at my BB/EB are with large corporates/PE firms. If i were to think about transitioning to a MM PE, i would imagine I'd have to show them my ability to ring in connections within the local/regional economy. A LMM PE does not care about my ability to call up the CFO of Google.
3. If you are looking for a Corp Dev/Corp Finance role in a company - assuming it’s a large company, the consensus is that leaving as a VP is marginally worse than leaving as an Associate. Take tech for example. Most people will end up going to a Manager/Senior Manager title (unlikely Director) if you exit as an associate with some years of experience. Director titles within these companies are from promotes- most likely they will bring someone in as a SM before promoting them. I've seen at least couple of people exit at VPs to SM roles which they could have probably gotten 1-2 years ago. The path in a smaller company might be less defined, but arguably more flexible, and potentially faster- but all this depends on the industry/company/role.
4. If you are looking for a more sales/originator role within the broader finance universe or peripheral industries, then VP title helps in so far as you have connections within a client base/bank. If you are a top tier BB, you probably have a much large contact base. Exits to Capital Markets group at a PE, Investor Relations, Origination at a fund (PE or PC)- these are all roles where you get paid to basically "milk" your connections you built in within the wider banking universe. I've seen a number of people from Top Tier BB (LevFin/IB/GCM/etc) leave for roles in Private Credit, Origination at PE, Capital Markets at PE, BD at PE, BD with FinTech/Crypto, Startups. There is no end to this, and many of them are done fairly well having left at VP/D/ED/MD level. If this is the plan, I'd even argue staying on till D from VP is more beneficial.
I think the worst thing anyone can do as a VP/D is be caught in this illusion of "coasting" because everything seems better compared to analyst/associate years. The reality is- if you are not constantly networking, or seeking ideas around your own path within your firm or outside- you are truly riding your luck because at worse, you are a very expensive associate to a firm. The best VPs are those that can seamlessly make the lives of their MDs easier (so valuable to their firm), and are generally well regarded/liked to build a network of contacts within the firm/clients that people will vouch for (valuable to themselves) and are likely to become originators of business outside of IB.
Coming from PE, I’d add to your points 1&2 that you actually dont really know execution. You either have coverage skills or you have M&A PROCESS skills. You don’t have actual due diligence / docs / IC skills. Coming in at the VP level would be equivalent to a MBA Associate in banking you all complain about so much. Yes you may be smart and learn, but you don’t know how to do the job at all. That’s kind of fine at a bank because there are so many bodies and slots and it’s a well known thing that you need a ramp up period, but if you’ve just layered a second year associate you can be sure as shit that they’re going to let you stumble and fall every single opportunity they get, and these teams being small and pretty unforgiving it’s very easy to go into a death spiral within your first six months without you even realising, only to be worked to the bone and spat back out before you can vest any meaningful carry.
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