40% paycut
Hi All. I'm a 3rd year analyst in a tier 1 city that's feeling pretty burnt out. I'm not interested in PE and would like to go the corporate development / FP&A route. For others who have made the switch, am I crazy for considering a 40% paycut from my IB base salary for a 9am to 5pm role in a fast growing business looking to build out it's FP&A team?
I want the work life balance very badly but to take a paycut that big is a hard pill to swallow. Has anyone made a move like this and have any feedback?
Add me on Warzone
I aint in FP&A but otherwise, are you me?
is this common for asset management or did you just get lucky?
Looks good to check
I read this in my mind with the Patrick Bateman/Christian Bale voice
How important is a very strict 9-5 to you? Corp dev will pay a little more and provide better optionality down the road, but you'll still be working IB hours on occasion. Corp strategy might be an option too, even IR or AM.
FP&A is more of a dead end than corp dev comp wise. They are basically managing the budgets, helping accounting close the books at month/Q end, forecasting revenue for the next year etc. Also, many of my friends have been burned here - "fast growing" companies especially those that think they're the next tech unicorn can slurp the life out of your WLB, diligence that part carefully.
Ultimately any of these will be a large pay cut from IB, but take a look at your VPs/MDs and whether you want that life. At some point there's more to life than money, and a lot of people do the calculus around your age that they are fine making low 6s for now and having their life back. The new banking raises make it harder to leave, but did that incremental few hundred in your paycheck actually make your life any better?
Not a young company. Been around for ~15 years. I'm just worried that the jump to a typical corp dev with banking-like hours will just feel like banking all over again
There aren't many corp dev groups out there with year round banking hours since the pay is a material discount. Maybe 6 weeks a year at most places. Also a less acquisitive company or one that mostly does minority investments corp dev is a lot chiller. But if you really want predictability after IB trauma, FP&A does makes sense.
I’d take baby steps here and do corp dev at a reputable pe portco. It won’t be 80hr+, it might be 60, it might be 40, but you might find 60 with a team you like is actually what you’re looking for after all. And if not, logical story to go back to IB.
all I’m trying to say is, you seem like you’re coming from a place of burnout and running away from something you don’t like rather than something you do like. So keep your options open. There is a reason you made it to IB to begin with - don’t confuse burnout with a sudden lack of ambition.
That depends on how much your all in comp is. If you're at a CVP/Moelis where they pay crazy high bonuses then yea that's something to consider as you'll still be making good money.
I'm at 125 base + ~60% bonus. So definitely a tough one. The 40% paycut only factors my base
Are you saying you'd go from 125k base to 75k? What would be all-in in corporate for you? Should be getting way more.
no feedback but are you sure this fast growing business will exist in a years time.
So the finance department is growing and relatively new compared to the business itself which has been around for ~15 years
got ya. and go for it if. your hourly rate is probably higher with the new role.
you're not crazy at all, i'm in the same spot you are though i'm in ER and have a couple years under my belt. i'm feeling burnt out and am going to accept an offer that has me taking a 50% paycut from my base and bonus is only 10-15%. but i'm going to be in a much happier state for WLB and have free time on my own to do stuff that i find more fulfilling than just raking in $
Hey just a few questions for you as i’m in my first year in ER at a boutique. What are your hours like? Are you at a BB? How many YOE? Salary? Thanks
Here is my issue for all these people that want to move from banking to corp dev or something other “easy” job.
They are not always easy. You can have a bad boss. You can work in a bad group. And just because you’re not making lots of money doesn’t mean your new boss won’t want good work product.
Everyone works hard. Teachers, short order cooks, construction workers, police, fireman, etc. the difference is they make peanuts compared to us.
There are easy jobs in banking if you really want it. Go work at Mizuho or Rabobank or Soc Gen. You get close to street pay and you’re never a lead bank, so there’s not much stress.
I'm sure those banks are still ~60-70 hours....which is still a lot if you want to sleep 7+ hours/night, workout 4-5x a week, not eat carry-out everyday (i.e. you need to cook/meal prep etc).
It will vary by bank and group and even the individual. I'm in a hole-in-the-wall group at a BB and associates+ average ~45-50 hours a week and make market base and then bonus is +/-10%. Analysts eat a little bit of shit with 65-70 hours per week but once I got to associate, it's eased up incredibly. It's also up to the individual to push back and divert work when appropriate (e.g., if you're cross-staffed with other groups, don't be quick to pick up work that likely belongs to your counterparts but be responsible for your end of the work and knock it out of the park).
As you move up, the tension for sourcing deals is also lessened if you're in a niche group or weaker platform. Top talent isn't kicking the door down to go work at places like Mizuho and Rabo, so as long as you're relatively put-together and can represent your firm and direct reports well, a path will almost be paved for you. You'll of course make more if you can swing your dick at places like GS/JPM/MS but at a significant cost to your wellbeing over your tenure.
You don't need to eat a crazy pay cut to find more balance in your life. It just takes standing up for yourself more and finding the right group. Granted, you may hate the work over time as it will become boring (or at least it has for me), but if the goal is top percentile pay with good "WLB" to pursue either hobbies or outside business interests, this is the place to be.
This is very true. I made a lifestyle jump to a corporate role after a bad case of burnout, took a big pay cut, and regretted it. Obviously, the pay cut stung, the work was boring, and my boss was wildly incompetent, petty, and unaccountable. Now trying to get back into banking. Grinding it out for 8-10 years in banking (including time served) and retiring young isn't the worst thing in the world. Would rather do that than work until I'm 60.
Hey - I recently made this move and also have started regretting it quickly. Were you able to get back into banking? If so, know the market today is especially worse than maybe when you were recruiting but if you have any advice on recruiting to make the change back and your experience would be much appreciated.
Any chance I could PM you? In a similar boat.
As someone who made this transition and has moved up a few seats in Corp Dev at different firms, I echo some of the earlier comments.
The pay cut (especially with the recent IB increases) can be a bit to grasp at first but in theory, you are doing so for the trade-off of WLB in a more stable corporate M&A role. In reality, a ton of factors can impact true hours for the role. I would say 9-7 is more realistic for CD Roles with a good deal flow with a healthy mix of Pre-LOI and Post-LOI activity.
As others mentioned, the hours can vary for deal flow before even getting to the team dynamics. I have been in roles with great bosses and people who were not quite ready to be in a management role. I have worked with some of the best teams during my tenure in CD and also in roles where I could feel isolated at times. It really comes down to culture, timing, deal flow and probably a few other factors as well.
If you are looking to make this transition, I would recommend Corp. Dev over FP&A without hesitation.
What level were you in banking when you made your transition?
Left IB at the Analyst level
CD is one of those roles you can exit a variety of levels from IB for the most part (even though it can become a bit more challenging the more senior you get in IB because of higher levels of comp you would be left behind even after landing a similar senior-level role in CD)
Echoing a lot of what other folks are saying in this thread about WLB. I have also found that some people need to enjoy what they do on a day to day basis at work while other love having free time and doing things outside of work on a lower budget is what will make them significantly happier.
I actually like the variability of CD. Most the time my hours are great and then every so often then ramp up for a deal. Typically, there is very very little weekend work even during the busy period.
However, I know the IB associates and early on associates a law firms that I’m working with are making similar $$ to me. That doesn’t bug me though because I’m typically walking my dog at 5:30 and occasionally sneaking out for a round of golf on a sunny afternoon. Life is too short so do what makes you happy. For me that would not be FP&A.
Typed this very quickly from my phone so apologies for any typos or if this makes absolutely no sense.
My opinion is, if you think you can take a 40% pay cut in a “tier 1” city from IB Analyst pay then you’re out of your mind. Tier 1 being NYC.
If you’re in Chicago. Go for it
Banking groups with a great lifestyle, where you will take a pay-cut vs. IB but can provide you career for life and typically 9-7. All of the below involve no modelling and no IM/endless books which is always the cause of a bad WLB.
- Asset based financing (i.e. ship or aircraft lending)
Caricaturing but it’s all about the asset LTV rather than creditworthiness of borrowing group. Upside: you do deals and you get to do DD to see how the aircraft/ships production side and take a LinkedIn pic with a bigass hull behind you
To be clear, not talking about Transport IB here which is completely different
- Export Credit Agency (ECA) financing
ECA guarantees bank against borrower default, bank funds deal but takes no credit risk. You do a bit of legal negotiation, a bit of pitching, and by the way, ECAs are all state-owned and take 9 weeks of holidays so nothing can happen during those times.
Downside: can be really quite boring and everyone who does this tend to stay there for life
- Credit Risk
You review credit application from any financing group (leveraged finance, project finance, the above etc.) and tear it apart. Your KPIs incentivise you to turn down every deal (if an underwrite fails, it’s on you, if a deal goes through and the bank makes $$$$, you have no upside)
Upside: good hours, job for life
Downside: small bonuses, everyone from the front office hates you cause you turn down their deals
- Investment Grade Acquisition Financing
In my view the best compromise- still very interesting but given counterparties are Inv Grade it’s a much better version than Leveraged Finance. Sometimes called Strategic Acquisition FInance. SG’s group for instance is viewed to be the best in the bank which is a bit of a joke in my view…
Downside: you have to work for SocGen
- Leveraged Syndication
Good mix between Capital Markets and Origination. At the heart, this is more a sales position but you still need to understand the credit you sell. Can make very decent money and everyone is out by 6pm.
Upside: you walk around the floor all day without shoes and with your headset speaking to investors about deals you only read 2 paragraphs on while playing the putter
This is beyond helpful, thanks for sharing.
My question is: how does someone get into these groups? I feel like these groups are never discussed when people talk about what groups to join.
Nothing extraordinary - other than Investment Grade Acquisition Finance / Strategic Acquisition Financing which is very well perceived internally, the rest are not exactly top bucket so it’s all about you reaching out to the teams and asking if there are openings
They would take an IB analyst every day of the week but will question your motivations to move there
Mentioning WLB is not as much taboo as it is with other groups but you’ll need to also show a genuine interest and an understanding of what they do (which in most cases is not rocket science)
Yup couldn’t agree more - that’s exactly what happened to me! Moved to one the above WBL friendly groups I mentioned above, hated it and went back into IB!
Sadly one is never content and we are wired to want what we don’t have (WLB if you get crushed, an exciting job if you have a 9-5)
Agree with this. I worked a normal 9 to 5 before banking. semi decent comp, but still sort of low (120k all in in NYC, about 5 years ago).
no emails after 5pm....never logged in from home ever.
no weekend work ever
honestly it was very demoralizing. I wasn't in any position of influence, people didn't care about my emails/projects, I would get told what to do by the P&L drivers all the time (and they didn't really treat me as an equal), and my coworkers in my team were mediocre and not impressive.
even 9 to 5, I had tons of free time during the day. I would take super long walk/coffee breaks just to break up the boredom. I literally felt like I was rotting myself to death in this job (and keep in mind it was a super nice office, free food, nice art, beer on tap etc).
And even after going home at 5pm, taking the subway to brookyln (because I couldnt afford rent in manhattan), I was just as exhausted as I am now in IB. It was a different type of mental burnout from being bored/unmotivated.
Im in IB now, and while it sucks in a very different way, I prefer this over my old job.
Most ex-tech large public Corp Dev roles top out around 450-600k all in comp (base+bonus+equity). Head of group (VP/SVP) can maybe hit 40-50% higher but that's with 10-15+ yrs of experience. There are exceptions to be sure (e.g. places where it reports directly to the CEO), but that mostly comes in the form of equity comp.
At whatever level you make the transition expect to get locked into low mid single digit annual increases and if you do well, promoted every 2-3 years with a 10-20% increase and maybe a nice off cycle extra equity grant, all of which (including normal course annual grants) usually have 3-ish yr vesting schedules attached.
WLB wise, comments above spot on. Some CD groups are super chill (usually b/c they are boring, low activity dead ends if you stay in corp dev) but provide a glide path to ops or P&L finance leadership roles. Others are super acquisitive, have an active corp VC arm, and have near banking hours for a good part of the year. Those also should be higher comp relative vs averages.And if you happen to land in a company that is likely to be sold in the foreseeable future, expect to work just as hard as any banker.
In most cases, Corp Dev is not a career move. There is limited room to move up to mid/senior levels. Most people, at all levels, exit out "to the business", even the VP/SVP dept heads at most places.
Remember, Corp Dev is a cost center in the eyes of most senior and mid-level corporate execs. Some places they are highly valued thought partners for the CEO/CFO, other places they are viewed as order takers for P&L operators. Most places it is somewhere in between.
Once you go corporate, running P&L is the highest probability path to making real $, and that is a pretty different skill set from M&A at more senior levels. Just look at public co disclosures - Corp Dev rarely makes the list of named executive officers. So look at those comp packages and know that the senior most Corp dev exec is usually making something notably below the lowest name on the NEO list.
The above comments mostly reference larger corporates. Portco Corp Dev is a different animal. Probably more like banker hours but more upside comp too (upside heavily weighted to the senior roles just like all PE). Highly variable, and way more risky. Also expect to move around a lot more (sponsor, company, and geography). But the head corp dev person at a larger platform roll-up can get cash comp like a public corp dev role and typically bank anywhere from $1-4M on each exit every 4-5 years. Not a bad path but not that different from banking with a lot more risk. However it's a much more common path for Corp Dev -> CEO in PE portcos than it is at public cos where it almost never happens.
Bumping. This thread has a lot of good anecdotes on life outside of high-finance even with the recent salary increases. Keep the pros-cons coming. Great thread.
I would actually recommend joining a Fintech/ Corporate Banking role instead of corporate development/ FP&A. While not being as hectic as IB (you would still be working weeks mostly 9am-7pm), you would still not be giving up hugely on the pay and have enough work/life balance. Also in Banks which have both IB and corporate banking divisions, its always possible to transition back to IB at a senior enough role after having worked a few years in Corporate Banking.
Becomes really hard post-VP
promote. I envy the 50-hour a week lifestyle but I’m 27 and make $500k cash and $200-$600k annual carry (depending on assumptions, prob closer to low end). Obv a charmed life, but cutting that to $300k all in would fucking hurt despite that being more than 99% of people my age
If you have rich parents, make the move.
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