I absolutely fucking deplore how obsessed the finance industry (especially WSO...) is with prestige. But despite my sentiment, I recognize that it would be naive to ignore the signaling effect that brand recognition inevitably has on people who will make impactful decisions towards one's life (supervisors, hiring managers, prospective investors, etc.). Therefore, sometimes it feels like the Nash/optimal strategy early on in one's career is to prioritize pReFtIgE, even if it is at the expense of one's growth and learning. Has anyone else felt trapped by this dichotomy?
For some personal context, I graduated from a garbage, redneck state school, and have no qualms with that fact. Sure, breaking in was an uphill battle, but I've never once felt disadvantaged by going to a non-target, since I know I chose it for good reasons and loved the experience. I am about to start at a great bank in a great group that I'm sure will open lots of doors. I've been considering the next steps in my career, and am interested in potentially joining a brand new PE fund with lots of room for growth and long-term upside; I'm not really interested in megafunds, as it doesn't sound like they are the best setting to learn how to become a great investor (please share if you disagree). The thing is, I keep hearing conflicting things from peers and mentors, some of whom extol the long-term value of working somewhere like KKR, BX, etc., while others dismiss it as overrated.
Again, can anybody relate? Would greatly appreciate advice/thoughts
I see no harm in building up your pedigree early on and then using that as a way to propel you later down the line
The way I look at it is you want to maximise optionality early on as it acts as a great hedge against future uncertainty and the fickleness of our own lives.
The truth is that nobody knows what they will do in 10,20, hell maybe even 5 years. But the thing is that working at the absolute best places will enable you to have the decision to choose should path A or B not look as appealing.
I have this debate internally with myself nearly everyday and I think this is ultimately where I drew the line.
I agree with your point on optionality. I guess my real question is this: how many data points on my resume are enough to serve as that career hedge? If I went to an undergrad with a poor academic reputation, but do an analyst stint in a strong BB group, is that enough to justify taking a chance on something more off the beaten path for my next career move? Obviously, it depends on one's risk tolerance. My worry is that I'll get caught up in the rat-race gunning for a top on-cycle offer, then shoot for an M7 MBA, and graduate at 29 years old with no sense for what I actually enjoy doing, having spent 6 years going through the same motions as everyone else in the industry.
I think two years in banking is enough to tell you whether you like finance / corporate world and to give you enough data points to convince other employers to hire you
The whole 2+2+M7 seems to be the right path for those who want to stay in “high” Finance. I don’t think you need to do MF buyout to run a company.
Have you ever thought that it’s just scary to give up the path for fear of what else you could be? I feel like that a lot
I also think it depends what you care about...
If you only care about modeling experience then you'll get that anywhere.
If you want to be in front of the best clients consistently, then yeah maybe prestige matters to you more.
Also, although its "hard" to get into top IB firms, once you get into a BB or EB its only marginally harder. If you care about that sort of thing then just give that bit of marginal effort and hopefully you'll end up where you want to be.
It's less about prestige and more about optionality - the kid from BX can go to an HF, top b-school, lateral to another PE fund, go into the corporate world, etc. much easier than the guy from the no-name fund. If PE is for sure your end goal, I think prioritizing culture/mentorship and finding a good long-term seat is a good strategy. The difficulty is that many don't know if they'll actually enjoy the transactional nature of the work until you're in the seat, especially with how fast recruiting moves nowadays.
Would generally agree that prestige is BS though - the shine of the job quickly wears off if you're working through holidays/weekends with no social life to speak of.
Thanks for your input. I agree with you and the other commenter on the point about optionality. Is your job title accurate? If so, having spent 4-5 years in finance, do you feel like you've had enough experience to get a sense of what you really enjoy doing? That's essentially what my question to the other commenter boils down to.
Such a good point! Many people fail to realize that prestige wears out fairly quickly if you don’t enjoy what you do period. That goes for anything else. Thats unless you are in it for the money in which theres nothing wrong with that. No shade on prestige but you got to be doing it for the right reasons as brand name is like icing on the cake after combination of many other factors.
This is exactly why going to a target school is critical. Even more so than your first job. The guy who graduates from Harvard can screw around early on in his career because that brand name and alumni network will always be there. If he wakes up one day and decides to pursue finance, there will be plenty of options available for him. Unfortunately, you went to a garbage redneck state-school, so you have to build pedigree through work experience. It sucks, but there's really no other option. Now, if you had attended a top-tier university then I would say that job prestige is incredibly overrated.
I agree with the directionality, but not the magnitude, of how you describe the relationship between school name and career optionality. Personally, overcoming the non-target name wasn't that big of a hurdle after I had talked to the right people and learned the right things to do (networking and self-study). For me, the biggest barrier to entry was merely learning about finance in the first place, since hardly any of my classmates or even professors knew the difference between an investment banker and a stockbroker, let alone anything about the finance recruitment process.
I'm more wondering whether a solid first gig out of undergrad establishes enough pedigree such that a megafund associate program and M7 MBA would have diminished marginal utility
Yeah, my post was more about prestige in general. You're not a MF or bust person, so prestige matters very little. What you actually accomplish at work and how proactive you are in networking is much more important. At the end of the day, you make your own exit opps. The truth is, being a bottom bucket analyst won't open any doors. Conversely, kicking ass at a no-name PE fund can rake in more money than most people on this forum dream of earning. Since you've already got your foot in the door, don't focus on prestige. Instead, concentrate on being the best in your group. Then, go out and join a rising fund or, even better, create your own KKR. Some may disagree, but I work in the VC/startup industry and that's how it works for me.
I disagree (coming from a top school). If you fuck around people won't trust you to do good work. Doesn't matter what's stamped on your bachelors degree.
I think 2 years is too short of a career in IB to say your set. BUT That being said, I’ve seen more than my share of bankers leave the industry with 2 years MBB / IB and place very well, even several years later. It’s all about the story you tell at the end of the day.
If you have the chance to place top MF why not do it? It really cannot hurt.
Of course, I agree that landing a top MF role doesn't hurt haha. But in my opinion, one of the biggest benefits of landing a top analyst gig is that it lets you take a bigger risk for your next career move. For example, being one of the first associates to join Clearlake in 2006, or Sycamore in 2011 would have been extremely rewarding. And if you ask me, I have greater respect for the guys who took a chance and made partner at those types of firms than for the guys who went from BB IB to MF PE to M7 MBA merely because that's what they thought they were "supposed to do."
I sympathize with this completely! At the end of the day we chose banking for the optionality not to have a path clearly laid out. If you do BB/EB -> MF -> H/W/S you will definitely have options but will you even take them? I do not see any reason for just taking a MF job to take one, in fact if you want your job long-term you’re in limiting B school options to 2/3 schools. Overall, you eventually either stop chasing the prestige or you are in some ways limiting your career optionality
The general line of advice is to stamp your passport - go to a target, do 2-4 years at a soul-crushing consulting/banking/PE job and then GTFO. It will forever make you the Harvard, ex-McKinsey guy and in our shallow world keep many doors open. A lot of people make the mistake of staying longer, but it sounds like you won't.
My old mentor's advice was to start with the most respected brand name and narrow your way down from there. Prestige is a superficial cousin to deep professional relationships; prestige will open doors and place eyes on you but the relationship you develop is what closes the deal. On the flip side, you might have the best relationships with people in one realm but if what you want is in another space then those relationships don't travel as far as a well-renowned brand name.
Ironically from my experience in growth equity/VC, prestige itself can be the differentiator between a good and bad investor simply from access to good deals. If people want to associate with you, even if it means for superficial reasons, you hold social capital that provides information and opportunity. You can be the best investor in the world on an analytical level but if you can't get a seat at the table to talk on a deal then your skills don't mean anything. We typically ridicule the idea of chasing prestige on this forum because most of us think we want to attain it to feel good inside instead of leveraging the social capital and impact of perception.
What KKR and Blackstone gets you is optionality: if you find out you hate PE, the name travels far enough to get you out but this is much harder out of an unsuccessful PE fund. If you know the people in this startup fund and really believe in the team + trust they'll have your back, that asymmetric knowledge is your edge to determine if it's a good move or not.
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