Mid-tier BB vs MBB for PE
I'm doing a junior SA this summer in IB at a mid-tier US BB (BofA/Citi) in NYC. I placed into a so-called "top" group, and am looking to recruit for buyout PE in my first year on the job. While I'm aware IB is the most common and direct route to PE, it seems to be reasonably common and feasible for junior consultants, particularly at MBB, to exit to PE after 2-3 years. While I haven't experienced either yet, if kids like myself can get to PE from both BB IB and MBB, why not go the MBB route and enjoy a marginally better lifestyle for 2 years and then go into PE with less risk of burning out? Would your advice for my situation be different if I was at a different BB/EB/MM IB? Is it harder to recruit for PE from Boston and other consulting hubs?
In the same vein, would B-schools rather take a BB IB -> MF/UMM PE candidate or their MBB -> MF/UMM counterpart? Obviously both are coveted, but which would have an edge all else equal?
Interned at mid-tier BB - highly recommended to stay at your group. Currently working at MBB, and if your ultimate goal is PE then BB is much better than MBB.
I would say MBB would definitely be preferred for B-School, but for MF PE recruitment I think you would have a slight edge in a mid tier BB. This is attributed to the fact that the skills are more similar, and you’re used to working longer hours than a consultant. I’m a bit bias but I don’t think MBB is all it’s cracked up to be in my opinion. You work slightly shorter hours (60-70 +up to 10 extra hours of traveling) for a significantly smaller paycheck. unless you want to branch out of finance (banking could arguably still be better) then banking is just better in almost every way
Thank you for your $0.02. To follow up, I'm interested in strategy, definitely not sure if I want to stay in finance long-term, and am mostly interested in PE firms that have their associates doing both transactions and portco operations, so perhaps UMM > MF for my circumstances. Given this new info, does consulting trump banking for me personally, or does the general advice still hold true?
There’s no wrong answer you’ll be fine if you recruit and network hard to get into reputable MM PE fund. I wouldn’t try UMM as I doubt their associates are working on many deals directly whereas in LMM and MM PE firms it a lot more likely. If you go to a target MBB school and think you can get in then go for it, but with the banking internship already in place you’re looking at a banking career to PE most likely.
Mid-tier BB is definitely better for PE.
Any way you look at it for most recruiters and by extension most PE funds, banking is a better background. And if by 'mid-tier' you mean CS, BAML, Citi or the likes, you will get immediate looks from most PE funds instead on having to hunt for PE funds which are more consultant friendly. MBB places well in PE but there's a list of funds which recruit from it rather than a banking role which will open the door for pretty much all funds. What I'm saying here is strictly from a perspective of doing your job to get into PE and that's it
Also I'm sure some interns here will aruge that only a JPM / MS / GS will get you the immediate look, this is categorically false. As long as you get in touch with the recruiters, you will get looks from pretty much all bulges. One can make a completely reasonable argument that the top three banks will be looked upon more favorably but any candidate from a good bank will have an equal opportunity for the most part. Only fund I have seen is an exception has been Blackstone but they do have associates who weren't MS M&A or GS classic groups
Thank you for the input. To add on, do you think I can I enjoy and be successful in PE if I end up finding IB to be a bit dry this summer?
Mid-tier BB: * Probability of getting a PE job is much higher (larger universe of firms). * But you may not be as competitive for the largest PE firms and may not get all the interviews you want. Many mid-tier BB analysts will end up at funds that were not their top choices. * Business school placement is worse. B schools are heavily biased in favor of MBB.
MBB: * Probability of getting a PE job is lower (smaller universe of firms). * But may be easier to get interviews from some of the best funds - H&F, Berkshire, Advent, TPG, Bain. Many MBB folks don't even want to do PE. Recruiting is also easier with better hours / some MBBs actually support you through the process and make calls for you. * Business school placement is much better. Smaller classes of MBB folks and b-schools have a bias in favor of them.
Overall, I'd recruit for MBB and if you get an offer, decide after.
I signed at a UMM/MF shop from MBB in the past on-cycle round. I disagree with some of the posters here and think that the probabilities of success are generally equivalent, especially if you're thinking of on-cycle. That's because there are still enough consultant-friendly firms that most consultants will have a full schedule during on-cycle. And keep in mind the supply of these candidates is also much lower since MBB is only 3 firms and overall PE interest is much less. As a result, bankers and consultants don't end up looking very different in terms of number of interviews when the process actually kicks off.
Now, certainly I could see the argument that for off-cycle recruiting the larger universe of potential funds raises the probability, since you could theoretically then have more shots on goal. But I think it's key to highlight that I knew almost no one from MBB who fully prepared for the process and didn't end up with a full interview schedule during on-cycle.
And once you're in the interview, it all comes down to you as a candidate. So once you get enough doors open, the focus turns to execution regardless of your background.
What's the fundamental difference between consulting and IB? I feel both are involved with advising and helping companies improve their performance?
i don't think IB has much do with operational improvements but i'll let OP answer
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