Canadian Pension Fund PE vs. top IBD

I am facing a choice between analyst role of a top IBD position and a good canadian pension fund PE position as the start of career. I am an Asian and the two positions are both in Hong Kong. I have learned the two postions have the following pros and cons:

IBD: Good name and good exit opps but the hours could be long and suffering. Besides, PE nowadays are more willing to hire from other PE instead of BB. However, it is the traditional proven good career start in the financial world.

Pension Fund: Good hours and good culture. However, as a pension fund, it is more LP-wise and do co-investment and portfolio management. The buyout deals are not as much in Asia as other regions. But it is also doing direct investment and could enable juniors learn a lot.

What's everyone's thoughts? Thanks in advance!

 

I see a lot of people on this website talk about the benefits of the network you gain in your analyst years. I think the value of this has diminished substantially relative to perhaps 10 or 20 years ago when classes were smaller and firms were more tightknit. Your BB analyst network nowadays is unlikely to "make or break" your future outcome. I did two years at GS and have been at a MF/UMM for the past 6 years - not once have I talked to my analyst class. Instead, my network has actually come from the deals that I've worked on and outreach that I do to proactively build out my network amongst bankers/operators/founders/etc.

If you want to be an investor, just go to CPP/OTP. Lateraling isn't as difficult as people make it out to be, especially in the Chinese market where network matters much more than brand/pedigree. 

 

To OP: imagine when you’re a VP/Principal and just need that one phone call to your buddy from BB class who just happens to be the son of a large SOE. Will leave the rest to imagination. I’m not an expert on doing business in China by any stretch, but I imagine relationships are just as important there as is anywhere else. It really boils down to what you make of it. You could be proactively building relationships with your colleagues, or you could just weather through the 2 years. Really up to you. I imagine the opportunity set is greater at at a BB, all else equal. Of course this would be somewhat different if you plan to internally transfer from CPPIB/OTPP’s HK office to TO or another city. Bottom line, still think BB has an edge/wider optionality, but you can’t go wrong either way. Congrats on getting both offers. 

VP
 

I would go for the PF. Depends what your long term goals are… people are so concerned with exit opps on this forum as if everyone here works at CVC and KKR.

The pension fund will probably be a good gig that can turn into a long term career. The banking position will never turn into a long term career because more often than not it will be toxic and I don’t know who would want to do that long term.

 
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If you're set to be a future investor, in my opinion OTPP/CPPIB is the clear answer. People forget about all the ancillary bullshit that you do as a banking analyst which has no translatable value to the buyside. Also OTPP/CPPIB have built out their direct investing platforms so much that I'd venture to say the majority of your work there will involve underwriting from a true principal/GP mindset, as opposed to co-investments. 

I think a lot of the comments here are quite misinformed. Remember there are a ton of people who even left BBs to go to these pension guys, so even if your base case career path is to stay and get promoted at one of these places, you would have ended up in the "median" buyside recruiting outcome as a default. You have further upside on the table if you want to be a hardo and recruit for KKR - megafunds would definitely consider a pension resume. Now, whether pension vs BB is better optimized for megafund recruiting is a debate, and BB *might* have a marginal advantage out of tradition, but is it smart to risk your career path for a pipe dream? (maybe ~5 megafund spots in all of HK every year vs. ~100 BB analysts per class). Be mindful that these pension funds certainly turn down BB second year analyst resumes every year - so seems pretty clear to me that going to a pension plan out of school has the better risk-reward in 2021.

 

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