PE > RX Consulting?
Having some internal thoughts after 5+ years in PE to move to RX consulting. Interviewed at some firms and think this could be a good place (both in the current macro enviro + as a long term career), would I be shooting myself in the foot with this move? Am I even competitive as a candidate?
Little bit of background: moved from a pretty well known PE firm to RX co at a non T1 firm and then back to a smaller PE firm, so can weigh in on this.
You’re not gonna be shooting yourself in the foot at all. If anything, PE + 5 years of reps gives you a big advantage walking into RX Co. Probably the hardest part of turnaround work is understanding how value actually gets created (and destroyed) in real businesses, and most pure-play consultants just don’t have that intuition yet, it gets created through reps. You (i'm assuming) already know how lenders think, how boards behave under stress, and what actually matters on the P&L vs. what’s noise. So that's good.
On competitiveness: yea, you’re competitive lol. Firms like FTI/Alix/A&M and most of the others have a thing for candidates who can bridge finance, operations, and stakeholder management. Assuming you can model cleanly, communicate crisply, and stay calm in ambiguity and deal with pressure you’ll be well positioned imo.
One thing I didn't fully account for was the lifestyle, and you mentioned that you're looking at this as a long term career so be aware of that. RX is fast, messy, and often chaotic. You’re dropped into situations with half-broken data and 48 hours to produce a cash flow your client will literally run their business on. Some people thrive in that environment; others miss the more structured, slower-burn nature of PE. But it’s absolutely a long-term career with real staying power, especially in this macro. The hours are defo better as in you don't consistently pull 80 hour weeks, you do a short burst of like a 90-100 hour week and then it goes to around 50 - 60. I absolutely loved the autonomy, you get a huge amount of ownership over what you do, which was very different from the super structured PE world. Pay's amazing as well.
If you like being the person who gets dropped into the fire and actually fixes things, it’s a great move. If you prefer evaluating from a distance, maybe less so. You will end up doing menial stuff sometimes depending on the mandate, that's just the nature of the work, not everything you do will be glamorous. So, you've got to be okay with rolling up your sleeves and just getting the job done, and the upside to this is you'll get a much deeper understanding of a firm in distress than you ever could in a boardroom.
how do (non rx) bankers fare in terms of rx co recruiting compared to PE at the midlevel?
If I'm reading your Q right you're basically asking how non-rx bankers fare in RX consulting recruiting? Being totally honest, the vast majority of laterals I've seen in RX co are from RX, PE or RX adjacent backgrounds (credit) etc. Only exception is FP&A at good firms since those guys know a 13 week cash flow inside out, but even they tend to have a bit more experience before making the lateral move.
Non RX bankers moving to turnaround consulting have the same issue that they would have when moving to RX IB; you're entering into an extremely technical and granular industry, and that industry expertise can't really be "learned", it comes through reps. Sure you could read moyer etc but when it comes to actual recruiting, the people who've done the work obviously have a bit more of an edge. Doesn't at all mean you won't make it, you might just have to try a bit harder, depending on what caliber of firm you go for.
TL;DR - It's harder but still very possible provided you do well on technicals and other hurdles, and come across as a nice person to work with.
I moved from PE into restructuring consulting, and the comment above captures the core reasons well. To build on it: restructuring work gives you a far deeper, ground level understanding of what it actually takes to change a business, operationally and financially. In many ways it pushes you a step beyond traditional PE, because you’re working as a true partner to the C suite rather than being a 25 or 35 year old telling CEOs and CFOs with decades of experience how to run their companies. That partnership mindset is only becoming more valuable as straightforward financial engineering becomes less effective for driving returns.
I’ve also enjoyed stepping out of the PE bureaucracy, where your entire trajectory can hinge on the impressions of one or two partners. In restructuring, especially at firms that pay on a billable model, the economics are compelling as well: by your late twenties or early thirties, it’s realistic to earn 400k to 1M, which is broadly competitive with PE (obv missing carry component but not sure I know of anyone that’s gotten massive carry checks these days)
How likely is it to see those comp levels outside of A&M/Alix/FTI? Also, how difficult was your case study?
It’s very firm dependent. Generally firms that pay you based on your billable hours will be on the higher end. One example is A&M. There’s firms where you can make more than Alix / FTI. Case studies are similar to PE in terms of difficulty
Just wanna give my take, and I'm going to go against the grain here so feel free to disagree / disgregard. I'd argue that people underestimate how hard it is to get into a good RX consulting firm nowadays. Maybe I'm being salty, but I tried to make the jump to a RX co, from a well known PE firm, not BX / Apollo / KKR, but just below them, and couldn't make it. Had everything going for me, but according to the feedback, there were just too many applicants that were very competitive. Just being at the bar won't be enough now imo, you've got to clear it + differentiate yourself to get in and then survive. You need to have a good story + explain any positioning gaps + be able to hit the ground running. It's not anomalously hard, just harder than many people in PE expect.
Another reason imo is that there really isn't a background that cleanly "maps" to rx consulting, unless obv. ur coming from another similar firm. It's a combination of lawyer, PE / credit investor, banker, consultant, and corporate finance. Makes it really hard to have any semblance of confidence of getting in, unlike IB > PE or something. Which is why you see such diverse backgrounds.
Now, to caveat this, yes it's much easier to get into a "non elite" or "T3+" firm, but then you might find it harder than expected to move up to a better firm. Nowadays everyone wants A&M / Alix. One mitigating factor is that WLB + comp are still most likely going to be pretty good at the aformentioned smaller firms.
All this to say, just be aware of the difficulties. Luck plays a factor as well, like you could get an easy interviewer, easy questions or whatever.
Check the background of associates at portage point partners they do Rx consulting
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