PE recruiting in Toronto

Yeah A&M is top tier. If I was exiting from an A&M/FTI, which banks/groups should I be aiming for? I know that M&A is the best to be in for PE, but I’m just trying to discern whether there’s a significant difference in recruiting outcomes between banks, like TD consumer/industrials whatever the fuck it’s called vs CIBC FIG for example.

Congrats on Alphi. 

sublime22:

Just in case you are not aware of this, but the PE scene in Toronto is pretty small, where for most places there is not an annual standard recruiting cycle like there is in the US as the PE scene is just not as big. There are probably some exceptions like Onex (plus ONCAP), Brookfield and some of the pensions who might do this, but for the most part, a lot of the other PE funds have generally smaller teams and likely only hire on an as needed basis. I don't know this for a fact, but I imagine more notable PE funds like (in no particular order) Alphi, Altas, Birch Hill, Clairvest, Fengate, Imperial, Torquest, etc. do not have dedicated recruiting every year unless someone leaves.

All of these PE funds I listed above, with the exception of Brookfield and the pensions, you can see the bios of the whole investment team on their websites which includes their backgrounds (i.e. partners/MD's through to analysts). From that, the most common background for analysts or associates are either the big 5 banks, a US bank (either in the Toronto office or somewhere in the US, the common Toronto offices I've seen are BAML, Greenhill, Morgan Stanley and GS) and maybe NBF, where there are probably more people coming from M&A vs. a specific industry coverage. That is not to say you cannot switch from industry coverage to PE, it's just that the analysts/associates that join PE from IBD coverage groups come from different industries like tech, diversified, FIG, etc. and as such it's hard to pick a specific group that best suits you for PE. I imagine though being placed in most coverage groups at any big 5 bank will not hamper your chances at getting a shot at working in PE with maybe the exception of natural resource groups (i.e. mining or oil & gas) as that industry is very different then what the typical PE funds invest in. But that is not to say if you're in a mining or O&G group you cannot join one of the PE firms I've listed above, it just makes it more difficult (I have seen people from BMO metals & mining, which is one of the top banking groups in Toronto, go to non-mining buyside exits but I imagine it is just a bit of a tougher story to sell).

In terms of boutiques / non-big 5, I would say it is going to be tougher to get into the more notable PE funds that I have listed earlier. That is not to say it cannot happen, but it will just be tougher where you will probably have to move upstream to a better IB before switching to PE and the smaller the bank, the tougher it will be to move upstream (e.g. easier to move from Canaccord vs. a Osprey or Fort Capital, etc.). There are a couple PE funds that take more non-traditional backgrounds, like Birch Hill has hired a bunch of ex-consultants or I know a handful of people who went to OTPP from valuations or corp dev, but the most common background is IB from the big 5 banks or US banks.

This is just from what I have seen, but I have not seen a lot of people in Toronto transition from Rx consulting to IB in Canada. That is not to say it cannot be done, but it is not a very common path where I have seen more people go from valuations or transaction advisory services to IB. Rx consulting is different than IB (i.e. Rx consulting is focusing on operational/financial management/turning around the business immediately and 13 week cash flows whereas IB is thinking about capital structure or M&A target) and that might be why there are less people going from that into IB. I also think Rx consulting is typically seen as an exit where you get paid pretty well and work less hours than IB so that also might be a reason why people don't leave as much.

Would add Altas to the list of funds that have a structured hiring process for Associates every year. To my knowledge it’s roughly a class of 6 these days with a good chunk hired on-cycle (with Amity as their headhunter)