PE to Director of Finance MF Portco

Even though it might sound unfair, yes from my sample size I have seen it been very difficult to people to get back on the deal side even with a 12-18 month stint elsewhere. If that makes you unsettling in any way, you shouldn’t take it.

If you are 100% okay with never going back to PE and understand you aren’t guaranteed an actual CFO role, then you can consider it. Just know what you’re getting into.

Associate 1 in PE - LBOs

I’m currently contemplating a similar jump and the guidance I’ve gotten from my VPs is it really depends on the specific situation. Are you going to a middle of the road, quite boring and not very acquisitive portco where you really don’t have a story to tell if you try to find your way back? Is it a well known PE asset or one that is run of the mill/dime a dozen? What compelling story do you think you could tell to get rehired as a Sr. Aso or VP over someone who’s up for it internally?

Very helpful - thanks. Can I PM you on the side?

Rover-S

In essence, you’d be producing what you’re currently receiving, which, broadly speaking, doesn’t sound like an upgrade.

What’s motivating you to consider this step?

I’d like to gain more operating experience and see how a business is run post close. Mainly, I think this is also a unique opportunity given I’d essentially be a right hand to the CFO (how it was described) at a multi billion dollar mega fund portco in an interesting industry. They want to deploy billions over the next few years across organic and inorganic growth opportunities. I wouldn’t be responsible for U/W day to day but would support the M&A team alongside the CFO (there is a dedicated M&A team that I wouldn’t technically fall under but would support and work closely with if that makes sense in addition to be involved cross functionally elsewhere). 

For additional context, I’m currently in energy PE and this would be a shift to a totally new industry which I’ve been wanting to do for a while.

Principal in PE - Other

Interesting situation. I am older and have made this decision once already, ultimately choosing to stay in PE over becoming a Portco CFO.  Several years later and I am now once again reconsidering. I will caveat that I am squarely in the middle market, and obviously older than you, so you may need to readjust this sentiment to fit the stage of your career path and MF lens (i.e. do you want to be a CFO one day, etc) 

Here was my thought process the first time:

• I liked the platform and believed in the equity story and exit path and felt it was a quicker path to liquidity than PE (this turned out to be true)  
• I wanted the experience of being an operator and felt it was a good learning ground. I also felt that I could add real value and drive a strong outcome.  
• I felt that if the outcome were successful (both my performance the deal) then I would have strong optionality: 1) be a CFO somewhere else; 2) be a PE operating partner 3) go back to the deal side 

I ultimately chose the PE seat because I felt that I was just hitting my stride in PE, was offered a step function increase in comp, and for personal reasons. 

Frankly, my thoughts haven't changed much in terms of this style of opportunity and I remain intrigued. Some observations for which I have developed high-conviction:

• The CFO role is a grind. Let's get that out of the way. However, there is little to no travel which is a nice offset. I have grown to really dislike business travel. 
• More of your time is spent on work that actually drives outcome. The thing I dislike most about PE is chasing deals that ultimately go nowhere. Feels like a big waste of time. 
• There is a dearth of CFO talent in the market. The comp packages have gotten quite compelling and can lead to better outcomes sooner than PE. However, it's easier to get stuck and if thing go sideways the CFO is literally the first person terminated. 
• The PE space feels crowded. Lots of funds. Lots of capital all chasing the same thing. high rates delaying exits and compressing returns. Feels hard to move up. Meanwhile all of the funds are looking for good operators. 

I would choose the option based on the career track most appealing to you. I do think the industry focus carries a good bit of weight too.  I wouldn't assume at your level that you could switch back to PE in the near-term. you would probably need to work your way up to CFO and have a good outcome or pivot to CFO of a mid-market company once you are comfortable, which you could probably do in just a few years. Maybe you could join a TacOps team sooner. 

Lastly, to get to the brass tacks, would you rather be the one putting deals together or co-piloting businesses. No wrong answer here. Maybe the proper PE analogy would be: would you prefer to originate or execute? The former requires the right disposition and mix of socializing, analyzing, executing. The latter requires detail-oriented focus on driving objectives. 

Thanks - very helpful. Am I better off doing something more traditional corp dev if I want this type of experience rather than what I’ve described? I’ll still be getting M&A exposure but won’t be owning the sourcing or full due diligence process.