Why is literally everyone trying to get into M&A?
Hi guys, I'm gonna ask perhaps a very stupid question here. I went to a fin networking event before covid at a prestigious school. I would say literally 80% of the graduating class there are going for M&A. coming from a non-corp finance background, I found that really intriguing. I mean sure the pay is great, but you literally gonna work your ass off with literally no life no anything but money. is it really worth it? surely there gotta be something that's why it's so sought after - can yall experts shed some lights from your personal experienece?
is it the work that you enjoy or the exit opp?
From the exit opportunity perspective: M&A and Leveraged Finance historically feed the strongest into PE. With that being said, there are some nuances attributed to top groups at respective companies. For example, GS FIG/TMT, etc.
From a learning perspective: Both M&A and Leveraged Finance are modeling-intensive. The modeling elements hit on more broad aspects whereas a coverage group like FIG is much more niche. The exposure gained in these two respective groups provide analysts with a strong learning experience, starting out.
What are some exit opps for an Associate in Leveraged Finance?
I’ve seen LevFin associates exit to credit funds broadly. Direct lending would be a logical exit given its essentially the same underwriting process at a smaller scale at many shops.
Very few jobs straight out of a business undergrad give you the early career risk/reward that M&A does. Its really IB & Consulting, with the next best (FLDPs? Big 4 Accounting?) a distant third.
There may be one-off exceptions to this for the superbly well-networked. But anything else better from an exit option standpoint would involve more risk (e.g. founding a startup).
Its a path well trodden for a reason.
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