So I'm not really sure how I should be asking for an industry suggestion since I'm a student, but I've done a fair amount of research on both ER and IB, but I'm not quite sure how I'd fit in so I'd like to hear from people in the industry where they think I belong since you have a fair amount of experience.
I enjoy writing and researching, which makes me think that ER is perfect for me, especially considering in IB most of the work is lackluster and although there is research as an element, you're mostly just pushing out pitchbooks and financial models (correct me if I'm wrong) whereas an ER analyst has a lot more "substantive" research into a company, its financials, leadership, business model, etc. But at the same time Investment Banking analysts can also get exposure via M&A so I'm not 100% sure who wins on the professional development front. I also obviously want to get paid the most for my work, and I think by the hourly basis, ER analysts get paid about the same. I also want to exit into a leadership position into F500, VC, or PE/HF. I may also want to start my own venture capital firm or hedge fund one day and I feel like ER would be the most applicable skillset into both of these fields, but I think IB gets more exit ops into these fields as well. I'm not scared to spend the first 1-3 yrs of my career out of college on intense labor, but ER feels a bit more meaningful. Still if my ultimate goal is to crack into the upper echelons of the corporate ladder or fulfill my own business dreams, will ER help me get there or will IB create a better path to those fields? And for the most part my decision relies on this. I feel like if I had to stay in one industry forever, ER would be it. But if I wanted career mobility, IB would be it. These are sort of my assumptions and I need some feedback on this so I know what I need to focus on going forward. Or is there some industry/career path I'm totally missing? I'd appreciate some constructive feedback, thanks.
Could you give us a tl;dr?
Generally speaking I would say it’s IB over ER and it’s not even close.
Why do you think IB is so much better? I think ER does give a better work/life balance, but also the work is less powerpoints bs and more research-oriented where you fully understand companies. I want to know which job's practical experience translates the most over to VC/HF
ER is on the way out. Dying industry
How is it being replaced? Might be a silly question, but I'm not sure how a computer could replace that
It's not quite being replaced, just no longer needed as much. You have to consider that the major consumers of ER insight have been actively-managed mutual funds, which themselves are rapidly being replaced by passive index funds, which obviously don't require equity research at all.
There are also some major implications of MiFID II legislation on ER. I'm not expert on it but its a major development that people have attributed to the decline.
That being said, if your goal is to take a couple years to learn the skills and network into a HF, might not be a bad idea. For VC, don't really think it'd be relevant at all since the financial research is way more high-level, and its fundamentally private transaction-oriented, which you won't get any exposure to in ER.
Makes sense, there must be a reason IB is the traditional path into VC/PE. That being said, which division of IB best prepares you for PE/VC?
M&A/Boutique
Same situation, ER would fit me better but IB better exit opp
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