Hey, I was wondering if anyone had any insight into the world of ADG PE. I am interested in joining a IB ADG group and am trying to figure out if that would lead to good exits in ADG. I am really passionate about the defense space and can’t really see myself exiting to something not in that same field. Also if anyone just has any knowledge on the exits most normal coming from ADG IB that would be great.
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Based on the most helpful WSO content, here are some insights into Investment Banking (IB) and Private Equity (PE) exits, particularly in the Aerospace, Defense, and Government (ADG) sector:
Group Placement and Exit Opportunities:
Interesting Exits:
Buyside Exits:
Challenges in Exiting to PE:
Non-Traditional Exits:
For more detailed discussions and specific examples, you might want to explore threads on WSO related to ADG IB groups and their exit opportunities.
Sources: Breakdown of Post-IB Exit Opportunities, Exit opps: I've crunched the previous work experience of 390 PE Associates.., A Few Observations on Investment Banking Exit Opportunities, Breakdown of Post-IB Exit Opportunities, Am I missing something about buyside exits?
Carlyle and Veritas are probably the two largest players in the ADG PE space, with Arlington Capital being another large player. Most pure ADG focused funds and banks / groups are in the DC metro area. On the IB side, the main MM players are Baird, Houlihan, RJ, Jefferies (Charlotte), KippsDesanto (Boutique owned by Cap One), Harris Williams (Richmond and think they're a newer group), DC Advisory, and Stifel. Baird and JEF probably sit about the rest in terms of deal flow and experience.
Many ADG PE shops sit in or around the DC Area, with others being in NYC, CLT, etc. Below is a list of ADG-focused or partially focused PE funds:
This list is not conclusive and there are several others that may have exposure to the space, but if you purely want to focus on ADG, then the above funds will be your best bet. Being located in DC is also probably beneficial if you're looking to build a career in the space, as most of the companies and investors are around that area and there's several industry events and other stuff happening all the time. ADG PE is a growing space and many funds have been doing well recently. Some newer funds - Godspeed (Veritas spinoff) just raised their second fund, and Capitol Meridian (Carlyle spinoff) has been doing well from what I've heard. Hope this helps.
Jeffries used to have ADG IB bankers in DC as well pre COVID. Check LinkedIn to confirm if team still sits in DC
I really appreciate your response. Is the recruiting process for IB ADG roles pretty standard? I've heard that having prior military experience can give you a significant advantage. Also, in the PE space for ADG, are the deal types, size, returns, and day-to-day work similar to those in technology PE or consumer goods PE?
ADG groups differ wildly at banks. Some banks are more heavy on the A while others on the D and others on the G. The D and the G tend to go together more often. This is because D&G is selling to the government while A is often large part commercial as well. Aerospace-heavy groups can also be mostly commercial focused as well, working on the big commercial airline deals. The more diverse group that focus on both A&D end markets are strong in component businesses (that can sell parts to any type of aircraft). Other groups are more government focused, either on the services or tech side or both.
Evercore, Goldman, Jefferies, Baird have pretty good groups focused on the government/defense side. Goldman, Evercore and Jeff are great on the hardware side- more A&D focused. Baird is top of the market in government services with a pretty great govtech practice as well. Jeff is also becoming solid in govtech, but its more of a newer thing for them. Mike Tarulli (previously at goldman, then at evercore, now back at goldman) has shaken up those two banks with pretty quick moves back and forth. He is probably the biggest name in the A&D sector. Evercore is still a very solid bank even without him though. Jean Stack and John Song at Baird are phenomenal, Jeff Mcgrath at jefferies is a solid banker.
There are a handful of reputable smaller players including HL, Kipps, RJ. HW wins some mandates as well, laz as well on the aerospace side.
Exits from ADG are no different than any other groups, either to generalist PE funds, sector-specific PE funds, family offices, HFs, or corp dev I've seen it all.
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