Equity Research to BD/IR career pivot?

I'm currently an Equity Research associate at a BB bank with some buyside experience and am considering a pivot to BD/IR roles on the buyside. I like analyzing companies and industries but consider relationship management / interpersonal skills to be an inherent strength and am looking for a more engaging work environment. While I'm sure the grass is greener on the other side, it seems like the move to a BD/IR role at a PE fund could be a great option and am considering the transition.

Would love the communities opinion on a few questions:

(1) Are there any benefits from entering BD/IR with an ER background or would I essentially be starting from scratch? Is this transition realistic or no?

(2) Am I being silly to consider the switch? What are the worst aspects of BR/IR on the buyside and how do these positions scale as you get older?

(3) Any recommendation on how to navigate the transition?

Thanks for your thoughts!

 

Based on the insights from Wall Street Oasis, transitioning from Equity Research (ER) to Business Development/Investor Relations (BD/IR) on the buyside is not only realistic but can also be advantageous due to your background. Here’s a breakdown of your questions:

  1. Benefits from ER to BD/IR Transition:

    • Analytical Skills: Your experience in ER provides a strong foundation in financial analysis and understanding of market trends, which are valuable in BD/IR roles where you need to communicate complex financial information clearly and persuasively.
    • Industry Knowledge: Having a deep understanding of specific industries through ER work can make you a valuable asset in BD/IR, especially in crafting narratives around investments and engaging with knowledgeable investors.
    • Realistic Transition: Many professionals in ER have successfully transitioned to BD/IR roles. Your skills in analysis, coupled with your interpersonal strengths, align well with the requirements of BD/IR positions which focus on relationship management and strategic communication.
  2. Considerations for the Switch:

    • Engagement Levels: BD/IR roles typically offer more interaction and relationship management compared to the often solitary nature of ER. If interpersonal engagement is your strength, this could be a fulfilling shift.
    • Challenges: One of the potential downsides could be the need for constant networking and possibly facing more direct pressure regarding fundraising or investor satisfaction. As you progress, the role can become more strategic, which might involve higher stakes and responsibilities.
    • Scaling with Age: As you advance in your career, BD/IR roles can scale into higher-level strategic positions, potentially leading to roles such as Director of Investor Relations or Head of Business Development, where your impact on business growth and investor engagement can be significant.
  3. Navigating the Transition:

    • Leverage Your Network: Utilize your existing contacts within the industry and your current firm. Networking can often provide direct paths to opportunities in BD/IR.
    • Highlight Relevant Skills: In your CV and interviews, emphasize your analytical skills, industry knowledge, and any direct experience you have in client-facing roles or situations where you've successfully managed relationships.
    • Educate Yourself: If possible, gain familiarity with the regulatory and strategic aspects of BD/IR roles. Understanding the specifics of what drives successful investor relations and business development in your target industry will be crucial.

Your inclination to switch to a BD/IR role seems well-founded based on your strengths and career interests. It’s a path that can offer dynamic work and significant professional growth, especially if you thrive in roles that blend analytical rigor with interpersonal interaction.

Sources: What would you like to know about Equity Sales / Research?, Exit-Ops: Equity Research vs. Investment Banking - (A Definitive Guide, Part 2), https://www.wallstreetoasis.com/forum/equity-research/career-ladder-equity-research-vs-investment-banking-a-definitive-guide-part-3?customgpt=1, Breaking into buy-side equity research - my experience, Breakdown of Post-IB Exit Opportunities

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ER to corporate (public company) IR is more common than private fund fundraising IR. You’ll have a differentiated background for folks managing listed BDCs for instance.

I prefer private fund fundraising to public company IR and have done both. The comp ceiling is higher on the private fund side (high six low 7 figures) but I’m not familiar with ER comp so can’t speak to the relative comparison there.

It depends what you want to be doing. At larger platforms there are pure sales roles and there are product roles while at small/midsize firms they overlap and it’s split more between seniors and juniors. Your prior experience is going to lend itself more to the product side which is centered around project management, execution, running diligence processes, acting as a subject matter expert effectively. That said, sales doesn’t require any special skills so you’re not excluded from doing that. As an analyst/associate though the work is pretty lame but you’re building up a Rolodex by being a party to the relationships your senior team has or helping open up smaller accounts.

I’m biased but it’s a great career path that is often overlooked. In a world where more managers go public or look to sell stakes management fees are increasingly important so there is a lot of focus on capital raising which translates to more resources and comp. Retail and insurance channels are the most interesting now a days. I don’t really want to be the 100th guy to call CALPERs on yet another mid market PE fund. It’s a career that can really weigh on you as like with all sales your success is often attributed to things entirely outside of your control. The fundraising environment right now isn’t great so representing the right strategy, team and product is hyper important. Ideally you start at a better brand just so people answer the phone.

 

Anything is a possible. I have seen IR associates transition to investment seats in a few strategies but it’s not normal. If you want an investment seat I would stay in banking until you have an opportunity to transition to an investment role. If you’re starting your career in IR it will be difficult but if you’re a top performer and well networked you can make something happen but it will still be a challenge.

 

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