Need Advice From Current PE Associates

Keeping it short – about to wrap up 3rd year in IB coverage. I know I have the A2A offer locked in. My work life balance is very strong, hardly work weekends and late nights are not very frequent. I'm at an upper middle market bank (HL / JEF / Baird).

I'm very sick of the work - I'm finding it super boring, unfulfilling, and frankly just not stimulating. Feel like I'm just not reaching my potential. I'm considering a late exit to PE because of this.

My question to you PE folks: am I just going to run into the same sh*t in PE after a year or two? Should I just enjoy the green grass and keep marching along? My worry is limited options in a few years when I'm fully sick of IB and want to do something else – options feel limited post associate years. Any advice is appreciated.

Comments (7)

  • Analyst 1 in IB - Cov

hey man in similar boat but unsure of A2A. Haven't been communicated when analysts will find out about associate jump. when do they signal whether you're getting the associated bump?

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  • Associate 3 in IB - Gen

Can ignore my title as I'm currently in PE and had the same situation (got A2A and had a spot as an Associate. Gotta look at it from pros and cons:

Pros (moving to PE)

- work is more stimulating (ex: instead of building a CIM where you make everything positive and don't really know what the company does, have to be able to understand product differentiation, market landscape, etc in PE) 

- also the case in banking, but for PE even more so working with the best and brightest (usually top rated bankers and consultants)

- compensation much higher in longer term (factoring in carry and if you survive the grind)

- allows flexibility of exit opps, even more so than banking (don't like buyout, move to growth or vc; work in industry at a company, etc)

Cons / Things to Consider: 

- WLB is essentially the same - can be better or worse depending on fund; especially if going to MF or UMM, hours can get worse 

- while hours are the same / wash, the intensity of those hours is much higher; less hand holding and less layers means you have ownership over a lot of the execution work, which can create stress (ex: if there's a massive bust in the model, it's on you)

- culture is not the same as IB (also fund dependent); from my limited experience, people are more eager to get in / out and get their work done, vs IB where people generally hung around, analysts bonded at night while waiting for comments, etc. Can lead to sometimes feelings of isolation

- You are effectively starting over in terms of your reputation, so will need to prove yourself to a new firm (whereas you have established credibility at your banking job)

The most important thing to diligence as you're going through is the culture and team you would be working for, should you want to make the jump to PE. It's not like banking where there's generally a standard experience, as there's a lot of variability in PE experiences as a junior member across funds. 

Hope this helps (realize I'm now rambling…)

  • 15
  • Quant in IB-M&A

This is great, appreciate your insights

  • Manager in CorpDev

At the risk of being repetitive -- quick additions are:

  • Work is definitely more stimulating but a lot more taxing (i.e., less breaks during the day, very quick deadlines, each day feels like a fire drill in some respects)
    • On average, hours are a bit less in PE but frankly not enough that really made me feel like I had more freedom
  • May not be the case at every firm, but people love their jobs more than banking which for me meant more weekend work / late nights on non-live deal work than banking (i.e., VP asks you something on Friday, will check in on Saturday to see how it's going then have a call with you on Sunday to review)
    • Also meant the culture is worse since there wasn't really a "we're all in this together" vibe, outside of some of the associates
    • Since it's all high-performing ex-Bankers and ex-Consultants, a lot of very Type A people with sharp elbows
  • More travel, and a lot of time, last minute (i.e., PortCo has an emergency pop up, you're going on the next flight out; you make the second round of the process, going to MP tomorrow)
  • You are both the analyst and associate, so have to do A LOT of grunt work while still being thoughtful / targeting with your investor mindset
    • Not necessarily a bad thing, but would often get bogged down with menial tasks that I felt were below my paygrade, but was lowest on totem pole
  • While it's not client services, you ultimately are at the whim of your Partner (i.e., your partner is your client), so there will be random weekend asks / wild deadlines that come up that I felt were driven by clients in IB
  • Learn a lot more about running a business, industries, business models, management styles, etc. in PE (this was my main plus over banking)
    • Banking felt a lot more superficial -- PE you do become a bit of an expert
  • Deal sprints are shorter in PE, but often more intense (i.e., two weeks to get through a VDR, completely substantially all diligence, create IC memo(s), formulate a bid, get to know management)
    • IB some live deals I were on lasted 6+ months
  • You are still 'on call' in PE pretty much 24/7; expect to cancel plans / vacations as things come up (including non-live deal work)
    • With that said, I did feel like you got more of a break after doing a deal in PE than banking, and it was easier to 'coast' when needed

Added a lot of pros and cons above, depending on your viewpoint. Ultimately, I think the answer comes down to what you are passionate about. If you truly are a deal junkie or are highly motivated by Prestige / comp, you will fit in and do well in PE (nothing wrong with that). If you *like* the job but don't *love* the job, I'd say your days in PE are similarly numbered and you'll eventually get to a spot where you seem to be now in IB. So, if you find yourself wanting to make a career in finance, likely worth it to switch. If not (and you just want to work a few more years to build up a nest egg / savings / go to B-School), likely worth it to stay at your IB a few more years where you already seem to have a good reputation and handle on the job. If you switch jobs, you'll lose that reputation and have to spend 6+ months building up goodwill, which is something to consider. At the end of the day, it's about longevity in this industry.

BullEagle, what's your opinion? Comment below:

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