Q&A: Career start and progression across IBD // Restructuring // PE special sits

Hi everyone, I have recently joined the platform as a mentor and keen to kick start my tenure with a Q&A session.

Quick background about myself - 3.5 years of IBD and restructuring experience in JPM and HL after which I pivoted to the buy-side into illiquid asset heavy situations at Apollo. I worked for over 8 yrs investing across industry and asset classes targeting debt and/or equity opportunities in private markets.

About my studies, plain vanilla business with particular depth into fin maths and statistics at a known European university followed by commodity and credit specific master program in London. In between those studies, I had a gap year interning in finance related stints. I figured global markets was my future bread and butter only to get hit by reality in 2008/9, which forced me to shift preferences towards IBD as a career start.

Much of this journey till today has been governed by grasping opportunities that came along my path without losing too much focus on big picture and my goals - which altered slightly throughout the years.. When commencing my bachelor studies, I would have never thought to be moving into finance, and glad of my choice.

I very much look forward to everyone's questions - seriously, I'm happy to answer anything that is important to you!

WSO Mentor

Want to work with me? Check out my profile here.

Comments (52)

Jul 6, 2022 - 4:09pm
Akephalos, what's your opinion? Comment below:

Thanks for doing this!

Curious about your time at Apollo, given what people say about the culture there, how you experienced it? Would you choose it again? Any regrets you've have nowadays?

Jul 6, 2022 - 5:05pm
Arsene Lupin_88, what's your opinion? Comment below:

Culture wise - my team had a very strong team spirit and sense of camaraderie. We worked on various deals as a team, supported one another when there were time sensitive deliverables and we enjoyed having drinks after a heavy one or had a proper night out! Many colleagues have become friends over the years and I still see them after I have left.

Regret is a tough one - I have thought about my path quite a bit, whether another industry or job spec would have suited me more or I would have enjoyed / gained more from it. I would have probably taken the same choices when presented with the equivalent set of opportunities. It's important to realise though that I am grateful for all the knowledge I accumulated which - in my view - did help me shape character, work ethics and left me with a sense of pragmatism. The skill set one acquires over the years is actually quite transferable to other fields of work, I recently discovered, more than I actually gave credit. However, I think It's important that we don't lose sight about why we are doing this and the sacrifices we will have to make at the expense of the time of our lives - which is very precious.

We should spend more time understanding our value and not forget what we are worth, because all these meat grinding factories will try to make you believe that you need them more than they need you.

I hope this was helpful

Jul 7, 2022 - 3:23am
Arsene Lupin_88, what's your opinion? Comment below:

Great question! When I looked to make the jump to the buy side, I wanted to immerse myself into an asset class or strategy that was quite thematic at that time. European banks were full of NPLs ensuring substantial deal flow that would have allowed me to learn quite a bit.

So yes, asset values often were relating to liquidation values, especially in instances that involved foreclosure and bankruptcy processes. There were plenty of loan to own situations in which assets had to be turned around or heavily refurbished; the restructuring rather occurred when investing into operating assets, like hotels or care homes.

  • Associate 2 in PE - Other
Jul 8, 2022 - 1:32am

Thanks. Looked and bid at a few hotel NPLs (prime location in tier 2 cities) early during COVID. I have a couple of follow up questions if you dont mind.. 

  1. I am guessing essentially these are mixed perf or non perf (covenant trips/non-cooperative borrower/non-payment) revolver or 1Ls collateralized by business assets and real estate where bank is looking for 70-80 cents or maybe 90 cents for better situated assets?
  2. Are you solely valuing the asset at a discount to OLV (maybe FLV?) to get to a bid? Mind sharing your thoughts on bid to value on these?
  3. Lets say if this is a $30m UPB pool comprised of 100 loans.. how deep are you digging? 
  4. What about situations when borrower is upside down (liquidation value lower than loan UPB)?
  5. I am guessing you wont have access to most recent financials in most cases.. correct me if I am wrong here. How do you determine the risk associated with that?
  6. How does the servicing dynamics work? Is it in-house or do you partner with an outside party?
  7. In terms of exit other than liberating the asset from the owner and re marketing it, what other exits are you targeting? A discounted payoff?
  8. 10-12% unlevered return profile? How comfortable are lenders with providing you leverage to lever this up? 60-70% leverage to get you to maybe a 15-17% levered IRR range?

Thanks so much for doing this. Edited to add qs. 8

  • Prospect in IB - Cov
Jul 6, 2022 - 10:31pm

How were your interviews like? How did you prepare for interviews and networking?

Jul 7, 2022 - 3:35am
Arsene Lupin_88, what's your opinion? Comment below:

Interviews varied and the whole process was quite lengthy. Some asked me investing or logic related questions and most were related to fit questions. At the end of the day, the case study will assess if you can produce what is required and most interviews want to ensure that you are not difficult to work with. Think of it this way, when I interviewed candidates, I was more concerned about if I'd like to still speak to the candidate after 14 hrs work session or during an asset tour. Nothing is worse than a toxic environment in an office, in my view.

How you prepare is similarly to many others, refresh your technical skills and rehears your story line, various questions you know will come up and think of follow up questions. There is more about personality then you think. Important is not to appear cocky, frustrated or aggressive. That can become exhausting especially during long hours. Be humble, approachable, show dedication, ask a lot of questions (never the same question to different people - sometimes they check that), research the team and what they do - you need to appear hungry to learn and show that you are prepared to work like a horse.

  • Intern in IB - Gen
Jul 7, 2022 - 10:04am

In your first 3.5 did you start at JPM then transition to HL RX? What prompted that change?

As an undergrad looking to eventually end up working in credit on the buyside, would you recommend a stint in more of a capital markets role like DCM or Liability Management, or a more traditional banking role like LevFin or RX to end up in a strong credit shop?

Jul 7, 2022 - 11:29am
Arsene Lupin_88, what's your opinion? Comment below:

Excellent question and the answer is quite quick - the amount you learn at any M&A stint is incomparable to restructuring in my view. My team at JPM was a pitching powerhouse with little deal flow and more than learning about merger models, simplified BS DCFs that incorporate perennial growth, and colour coding in pretty slides just wasn't there.

Depends what kind of credit fund to be honest. I feel in restructuring it will allow you to understand very well value across cap structure and cash flow risk, which in my view is empirical to understand for a credit investor. Levfin in a bulge bank with strong balance sheet is excellent start as well. I'm unsure about DCM, you will end up creating bonds and loan products for clients, this is definitely valuable learning, but unsure if that will help you for your next step in a credit shop.

Let me know if this was helpful

  • Intern in IB - Gen
Jul 7, 2022 - 1:01pm

Very helpful thank you for answering! I'm in a position where I either choose to work at a GS/MS/Citi style levfin team (i.e. a capital markets levfin group where there is no modeling but more pricing/market views) or at a good Rx shop, and my end goal is a high-yield credit on the buyside

  • Analyst 2 in Consulting
Jul 7, 2022 - 10:58pm

Hey thanks for taking the time. I'm currently at the analyst level in RX consulting(FTI/A&M/Alix) - I often find myself weighing a move to RX banking. I feel I have a strong sense of the practical differences vs. my current role: in terms of daily tasks, in depth and relevant (for buyside) modeling reps earlier on, better comp, more hours, but no travel. 

But, its the more theoretical differences: balance sheet rx vs. operational focus, temperament with clients, and potential buyside ops that I struggle with. Do you have any views on the long term career path in rx consulting compared to banking? Anecdotally, I've heard of folks going from rx banking to the buyside and back whereas rx consulting seems more silloed is this accurate in your view?  

Any other thoughts on a longterm career in rx or special sits/distressed buyside seats would be appreciated as well.

Jul 8, 2022 - 3:36am
Arsene Lupin_88, what's your opinion? Comment below:

Yeah I get where you are coming from. Operational consulting will give you a path to asset management and less investing, at least that's what I've seen in the market. You will learn the practicalities of daily activities, but funds will struggle to think Alix crowds as investors. It's like a rubber stamp, it doesn't necessarily need to be true.

I am not sure what you mean by temperament with clients, apologies. It depends what you are also good at and where you want to end up working long term. If it is funds, I would try to move away from consulting roles. The modelling skills you get there is different I would expect.

I'd focus on going to career fairs, networking through friends and doing active reach outs. Head hunters rarely like doing the heavy lifting and rather go for easy kills. So while I would seek support from them, I would not expect too much from them.

Hope this helped

Jul 8, 2022 - 3:40am
Arsene Lupin_88, what's your opinion? Comment below:

I wouldn't stress too much but ensure you go with a decent name that will help you jump to a higher place if those names are not yet on your list. I have seen partners at very good funds coming from the big 4 or even the army.We are not working in Astro physics if people like you and like working with you and you are switched on then word goes around. Be amicable, try to help, be humble, pay your dues and network a lot. That's all you can do. A friend of mine came from a bank that I never heard of and now is director at a trading desk after having worked long in HL.Let me know if this was helpful

  • Associate 1 in Risk Mnmgt
Jul 8, 2022 - 3:37pm

Thanks a lot for doing this. I'm about to switch from Credit Risk (3yrs of experience) to IB (1st yr Associate). Do you have any advice on how to make myself noticeable and valuable for the team from the beginning? I applied for an analyst position, but got hired as an Associate in the end. I'm ready to put in the work and hours, don't want to be in the lower bucket by next year. The team has never transferred employees internally from Credit (coming from a non-target school as well), and I was already knoe they have high expectations. Many thanks. 

Most Helpful
Jul 9, 2022 - 7:10am
Arsene Lupin_88, what's your opinion? Comment below:

Of course! So couple of things here that I see.

  1. we all have impostor syndrome, when starting at such firms. High pressure and intensity to produce immaculate results at all times on little sleep is very stressful. Many are able to say certain buzz words at the right time, probably not understanding what it means or big picture all to ensure a certain appearance. There is a huge competition to constantly prove that members belong in the team, it can be actually exhausting sometimes. However much of it is facade, people hiding away their insecurities in front of the harsh and often toxic team spirit. Fact is that everyone in that team has been carefully selected through assessments of various departments. Everyone is smart who commences work there, but unfortunately many get overwhelmed by their surroundings questioning their abilities, which they shouldn't.
  1. You have been selected after working at your firm for over 3 years in a team that allows you to understand risk (M&A will never teach you that). The bank has basically 3 years of factual history about you! You appear to be the first transferee into a team that never wanted internal transfers prior to your shift. Not only that, you humbly asked to be placed as an analyst, but after careful internal discussions above your pay grade the team decided to hire you as an associate. Evidently you must have done good work previously. Very important that you get that THIS IS NOT AN NGO AND NOTHING IS HANDED TO YOU FOR FREE! If they offered it to you that means they believe you deserve it. Period!
  1. These should be all positive signals proving that seniors believe in your capabilities. Of course they will have high expectations about you. The person who told you that probably is your biggest supporter and wants to be proven right.
  1. So why are you expecting failure, you are immediately doubting your capabilities without even commencing your tenure. You deserve a seat at the table as much as anyone else in the team, you probably have an advantage to others as you have seen also other departments in the firm.
  1. So what to do next, get lots of endorphins through routines gym sessions ( doesn't need to be long), get some grit and prove the people that supported your entry you are even better than others. Take on work, when you have capacity and show that you are willing to do the extra mile. You got it all, you just need to believe in it - as you probably already know, you are your worst enemy and you might end up capping your upside out of fear of the unknown if you start your career shift with doubts. But without trying you will never know, and you are probably not giving enough value to your capabilities.
  1. If you struggle in not understanding things, spend weekends trying to go through the issues that bother you. This isn't rocket science. Merger models are adding and subtracting 2 cash flow statements. You are not there to come up with a new relativity theory ! You will have analysts working for you so you will have a bit more time.
  1. Think about what comes next and try to preempt Workflows so that your VP/Director etc will see that you are thinking with them. That is key because they will then see you as their equal and at some point start discussing items with you in search for advice (sparring partner).
  1. First 6 months are important so work hard and maybe don't do the 7am saturday party that turns you into a zombie until middle of the week :). But give yourself breaks and distractions.

Maybe a bit lengthy of pep talk but hope this is helpful. Let me know if you have other questions.

  • Associate 1 in Risk Mnmgt
Jul 10, 2022 - 9:28am

Thank you for the insights and valuable input. Really appreciate it.

I am indeed concerned about disappointing the seniors that made my move possible, which creates the additional pressure on top of my own insecurities. I see your point on 'being your own enemy and capping your upside', I'm working on improving in that direction, and your advice helps a lot! 

  • Intern in PE - Other
Jul 9, 2022 - 1:15pm

thoughts on landscape of special sits funds and how to think about them? (i.e. Apollo HV, BX Tac Opps, Ares Special Opps, Bain Capital Special Sits, and KKR Dislocation Opps)

What do you think of starting your career at the analyst level in distressed credit / special sits? Better than top IB? i.e. would you take ASOF/BCC over PJT RSSG?

What's the difficulty of jumping to traditional MF PE from your role?

Jul 10, 2022 - 5:43am
Arsene Lupin_88, what's your opinion? Comment below:

You can't make a mistake with any of the listed names really. I can tell you about london teams and which ones are probably a bit better in terms of culture and spirit etc. but I'm guessing you are US based :).

Distressed and special sits is quite a topical move given our economy's direction of travel so I guess they will continue to be busy. However, most shops don't hire analysts other than Blackstone as far as I know.. Especially HF require a very slim team size and will probably hire people who can "plug and play".

Most shops also don't really have the platform for you to learn and grow without being penalised that you are not running fast enough.If you want to get there, I'd probably go to a place that will teach you to navigate through difficult economic circumstances within credit names, learning about capital structure and especially how to evaluate and understand risk. RX, levfin are 2 opps I have seen all my colleagues moving into similar funds you are seeking.

Not sure about your thoughts of moving between distressed and MFPE. If you are worried about deal flow and adjusting investment scope to market trend evolutions? Clearly they are at opposing ends and if it's about how much you will "learn"… then hopping between auctions and trying to guesstimate new ways to pump your EBITDA to remain competitive in auction processes like in PE is less intriguing in my view. Special sits on the other hand is like a chameleon changing its colour to various opportunities trying identify an angle that makes sense. Which means you will rarely see replication in deals at the same level as MFPE. Also I believe you will learn less for "life and personal investment skills" in MFPE.

Hope this was helpful

  • Intern in PE - Other
Jul 10, 2022 - 9:10am

Ares and Bain Capital Credit also hire undergrads. Am US based, but would appreciate your perspective on the London teams and the differences between mandates

  • NA in IB - Cov
Jul 10, 2022 - 12:57pm

Thanks a lot for doing this.

Among the names mentioned above (i.e. Apollo HV, BX Tac Opps, Ares Special Opps, Bain Capital Special Sits, and KKR Dislocation Opps), which ones would you say have the better culture in London? 

Jul 10, 2022 - 6:25am
Arsene Lupin_88, what's your opinion? Comment below:

Ok so let's put away all the technical skills etc. I'm that case it's also about how you can help yourself grow more quickly. I think there isn't a clear cut definition of what someone needs to have as we are all different, some things appear more natural to some than to others.First one I'd probably take preparation, especially at your start of the career it's a lot about how you come across to your "internal clients". Prepare what you have to say, when you present an idea or whatever it is, make sure it looks like you thought about this and it comes across well spoken. Perception of people is key to get on their good side. A lot in our jobs is about selling ourselves. Being well versed and posing eloquent questions / assertions will help you gain trust.Spotless work product could be the second. Make sure that people view your work as always right, even if sometimes it's not you need to manage that perception. Accuracy beats speed! You can be fast once you have done the same task 1000 times. The quicker you hold both the faster you climb.Positive attitude at work, keep the frowning, private life and bad day attitude at home. People will enjoy working with you that's super valuable.Make sure you have a routine gym thing you do, even just 20min in the am. It makes your body release endorphins and you will be less likely to drop into a pit of self sorrow that will only cause you damage.Hope this helps

Jul 10, 2022 - 2:23am
Tommy1303, what's your opinion? Comment below:

I was able to do an internship in a Distressed credit hedge fund in London earlier this year. I was working part time along with my masters. I really enjoyed the work as it was when Ukraine-Russia war broke out. I wanted to learn more about the process for breaking into this field. Thank you for this thread!!

I am going to graduate soon and am currently waiting to hear back from a large insurance company for a private credit investment analyst role. They invest across infrastructure, real estate, structured credit, etc. I would be learning credit analysis and cashflow modelling in this role. The only drawback is that they can only invest in IG credit. Do you think this is relevant experience for breaking into this field?

Jul 10, 2022 - 6:57am
Arsene Lupin_88, what's your opinion? Comment below:

I see what you mean. I would try to think positive here.

What are the alternatives? Is there anything better that You could do?

If this is your sole gig in investment then I'd say go for it. You have made your jump to the buy side quicker than most. You will learn anyway lots as you are coming fresh from uni. Even if you will want to go somewhere else in 2 yrs or so, no one will hold this stint against you. Actually your story on why you want to move would make a lot of sense.

I hope this was helpful

  • Associate 1 in IB-M&A
Jul 10, 2022 - 5:37am

Hey, thanks for doing this!

At JPM were you in a coverage group and then moved to HL RX? 

If so, how easy was it to make the move across groups? I'm currently in M&A but really want to move over to RX at a HL type shop. How did you prep yourself for the different discipline, how were the interviews? Also was there a big difference in culture/wlb across the two groups (I realise they were in different firms also)?

My long term goal is to move from M&A to RX and then distressed credit/special sits/distressed turnaround HF

Jul 10, 2022 - 11:02am
Arsene Lupin_88, what's your opinion? Comment below:

My move to RX was not very difficult. I had a good name and RX usually has a higher turnover of the junior population. This means they are generally hiring across the year on ad hoc basis. This puts you into an advantage against people coming from uni and only able to land an internship to then be selected as first year analyst. Question is at what level will they take you is, HL is renowned offering incoming lateral hires more junior roles. Thought here is that M&A teaches you different skills and know how, but the essentials on cap structure and understanding value breaking in companies experiencing periods of distress, is absent.

So I could imagine they might try something like this.

I would prepare for the following: understanding cap structure, different reasons of seniority within credit, various payments existing, differences between public and private debt FA. And start setting a timer for modelling LBOS with a cap structure that has

  • revolver
  • First lien pari A and B facilities
  • Second lien
  • Mezzanine
  • Equity

Best book of course on that is Moyer on distressed debt analysis. It's a bit lengthy but it will give a taste of what analysis will be touched upon in distressed funds - btw I read it after I got the job at HL so no need to read in order to apply. I would go to the better headhunters who definitely can place you or try to network your way to people working in the industry.

Culture wise it's very different. RX is a lot more aggressive and no BS. There are time sensitive issues popping up constantly as money is running out. That is quite different scenario than the perfect merger world. People are also a lot more direct so no wasting time either.

People at HL actually stick more with one another as in IBD it was more everyone on its own. Maybe it was team related.. . I think there is more camaraderie at RX and also they pay better.

Let me know if this was helpful

  • Associate 1 in IB-M&A
Jul 10, 2022 - 3:41pm

Got it, sounds more intense than IBD. You seem to be based in London, any thoughts on Roths RX? My old MD moved there and i could probably reach out. 

Also does a specific sector specialism help in RX, illiquid/distressed PE? I'm currently an Aso1 in FIG, not sure if that is a hindrance? We're pretty modelling heavy and im comfortable with balance sheet heavy assets like banks and insurance underwriters/risk carriers 

Aug 10, 2022 - 10:43am
manou08, what's your opinion? Comment below:

Have you heard about the workout and restructuring teams at Bulge Bracket Banks (GS, JPM) that sits within the credit risk department ? Do you think there are good teams integrate if someone wants to move to the buy-side later?

Aug 10, 2022 - 1:13pm
jamesbaldwin, what's your opinion? Comment below:

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Aug 11, 2022 - 4:50pm
itman, what's your opinion? Comment below:

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