Reneging on top tier bank for PE analyst role
In an interesting situation right now, and could use some brutally honest advice. I’m a semi / non-target who recently endured IB recruitment (40+ networking calls, countless hours on the BIWS guides, etc), and I finally landed a summer analyst offer at a top BB firm. I was fucking ecstatic—called my parents in tears, accepted the offer instantly, etc.
Fast forward to last week. I was catching up with this PE guy I'd networked with while using RecruiterBase during the networking phase (he's an associate at a mid-size PE shop) who I'd honestly forgotten about, but a few weeks ago he emailed me to mention they're looking to hire a summer analyst or two to their team with the hopes of bringing them on full-time the following year. Said their process is usually pretty under the radar since they only take 2-3 kids each year. Long story short, he got me an interview, I did it as a “why not” thing and three rounds later, and just got the offer yesterday.
The comp is actually slightly lower than the BB but it's a direct PE analyst role, not the 2-year banking grind. The shop isn't KKR/Blackstone level but definitely respectable (AUM around $5B, decent track record).
Here's where I need advice: I already signed with the BB. Their offer letter had all that standard language about how they can rescind at any time for any reason, but I know reneging can be a cardinal sin in this industry.
At the same time, I wanted to weather the IB pipeline specifically to land in PE. Skipping the 100-hour banking weeks sounds amazing, and this role feels like a much more direct path into PE given the firm was explicit about hiring interns as full-time analysts as long as they don’t totally drop the ball.
My questions:
- How severe is the reneging backlash actually? Does it even matter given it’s for a PE role and not another IB role?
- Is it actually stupid to turn down a prestigious BB for a mid-size PE shop? I’ve heard I may not actually learn as much in a PE analyst role, and it also lacks the “camaraderie” of being apart of an IB class
- Has anyone here successfully reneged without ruining their career?
- Does the fact that the BB is a tier 1 name, while the PE firm might only impress some finance-specific people, factor into this at all?
- Any other considerations I'm missing here?
I have to give the PE shop an answer by next Friday and I'm pretty torn. The BB recruiting team has been emailing me about onboarding shit which is making the guilt even worse.
What would you do in my situation?
Do not renege. Don't take any PE unless it's a MF >$15bn latest fund. It's a mistake. You can get anywhere with top BB but you're way too early to kill optionality as an analyst at a Mm PE fund.
Disagree. OP will learn more at MM PE and is clearly his interest. What optionality is really maintained at BB if he likes PE?
He won’t learn more at a 5BN MM PE firm. He’ll have far less transaction experience and will be lucky to see 1 full-cycle deal. If he doesn’t convert to full time (or needs to recruit for associate positions in 2-3 years), BB & EB summer analysts/analysts will run laps around him. He won’t even pass the resume screening for UMM & MF PE firms with such a small PE firm. If he’s recruiting for other MM firms in a few years, he’ll still be competing with UMM/MF & EB/BB candidates looking for better WLB. Best case scenario his background is on-par but uninspiring. The BB banking internship will provide a ton more training and optionality for the future.
Listen to this, OP. Do not take the PE offer.
The commenter is bang on and I could probably elaborate for another thousand words on it which I will do if you need it to avoid making a material career mistake.
Could you elaborate on your perspective just a little bit lol? Was also wondering why starting directly in MM PE is a bad idea if that's where you want to end up anyways.
First, it's not kind to reneg but you always should prioritize yourself
Second, I would not reneg here. You are from a non-target and you're about to get a 'gold stamp' from a BB. Franky I'd choose the BB for the training and infrastructure regardless. It will lead to better exit ops; better mba apps; and more recognition if you decide to pursue another more laymans career
I can't see a downside to doing 2 years analyst at an IB. They will teach polish, presentation skills, structured analysis, attention to detail. And everyone recognizes that
The PE analyst program could be amazing. Or it could be terrible. You really don't know. Get your sea legs before taking those risks.
100% agree. You’d have to be atupid to go to a MM $5bn aum PE shop instead of a top BB role.
Sign the PE offer if you want to be an investor and don’t look back
I’d go with IB, but join the PE fund if you think you can have a long term career there. I suggest you diligence their returns, founder age, pedigree, commitment to staying around for the long-term.
I would stick with BB. Would echo the above and say unless its a MF/UMM (which the fund clearly isnt) a PE analyst spot is worse than BB. Also MMPE are highly unlikely to have good resources to support your growth
You know , it’s super easy to always wonder about the “next big thing”, and always look for more prestige.
But the objective right answer here is to take the PE spot if you want PE. Absolutely no gurantees you’d get this again.
Disagree with this take. Clearly OP is smart/hardworking (or luck) to have landed both a top BB offer and a PE offer.
$5bn AUM is not that big and would probably be like… maybe at most a $2.5bn fund? Nothing wrong with a $2.5bn fund but coming from a top BB group you have a very high chance of going to a fund of that size if not larger/bettee
Was in a similar situation and took the PE offer. If you want to do PE and like the shop and see upward mobility then take the PE offer. Life is not about prestige. Do what you like and do it well. You will have not problem in the future.
You need to do some research.
1) What are the outcomes of previous analysts at this PE shop? Do they make Associate, are they able to lateral successfully, etc.?
2) Has this PE program been around long enough that you’re confident you will learn something instead of the firm not knowing what to do with you?
3) Is your BB offer top group, group selection TBD or mid/lower group? How do analysts in that group place?
4) If you could have any PE gig out of banking, would it be this shop?
5) Are the hours at this fund actually better than banking?
This is an ad for RecruiterBase. This user posts on Reddit with fake stories that mention RecruiterBase too and that user's profile is all about his startup and the legality of selling email addresses that he hasn't confirmed are real.
The plot thickens
If that’s your end goal, go for PE and don’t look back.
As someone who’s been recruiting for years because my sector overhired during covid, I can tell you that you never know how buyside interviews are gonna go.
One fund told me after 13 interviews and 3 super days that they weren’t sure about fit and ended up not recruiting anyone at all. Another fund didn’t manage to fundraise. Another fund preferred recruiting a female at the final stage for diversity purposes. Another one I pulled an all nighter and they made me do the case study with 2h sleep the night before (no surprise, I didn’t crush it). And on and on. Granted, I am very fixed on a specific type of role so it doesn’t help. But you get my point.
On the other hand, your banking buddies will forget your name in 2 weeks. And if they don’t, keep in mind that under no circumstance can they afford to make any negative comment about a potential client, even if they hate you (seen it - MDs saying a guy was a top performer and great guy after they PIP’d him and fired him. Hilarious). They’re not gonna call your new boss. If you’re scared about that, don’t tell them where you’re going and hide your LinkedIn profile for a couple months (likely unnecessary). Also, remember they would fire you any chance they got. Nothing is assured. Hell, you haven’t even started.
A factor to consider is that you’re gonna get killed in IB. Might be hard to interview. Another side to that story is: do you want to do large cap PE long term, or tier 1 VC? If so, why? Keep in mind if you work at KKR you’ll keep putting 90hrs a week consistently. It’s not gonna be a lifestyle move. If you want to have a personal life, that’s not gonna happen before you’re 30. Ask yourself if that’s ok with you. If you do not want to go to KKR and want to do midcap PE like the fund you just found now, then don’t delay.
Long story short, go for what you’re actually interested in (PE). Unless it was a choice between a $100m first time fund and GS TMT, pretty obvious decision imo.
If this is an ad, whatever, but going to answer in case anyone is actually looking for an answer.
Ignore some of the answers in this thread from people who haven’t actually faced the same decision — not saying they’re malicious, but don’t think they get it.
I was in this exact situation (but for PC) — ended up taking the buyside offer at a respectable, but non-MF, fund with good culture and a specific strategy I was truly interested in.
My banking friends are all overworked and don’t seem to enjoy it. They’ve had varying degrees of success with on-cycle — the MF offer is not even close to guaranteed.
On the other hand, I’ve had a great experience, learned a lot — especially in terms of writing/thinking like an investor — and hope I have the opportunity to stay long term.
Not one size fits all, but if you could see yourself at this firm, take it and don’t look back.
Was in a similar position a few years ago with offers at a slightly larger shop, ~$10bn AUM and a top BB/EB - albeit in a position where I was choosing between offers and did not have to renege.
Points regarding optionality, brand name, reneging, etc., are obvious and important to consider.
I personally went with PE after much consideration, but doing so requires a lot more diligence. Only do it if you’re certain you want to work in PE, that the firm is on an upward trajectory (increasing fund sizes, strong fund performance, growing headcount, history of internal promotion), and that you find their investment philosophy interesting. Most importantly consider the people you will be working with carefully as you will simply have many fewer coworkers. It will also be harder to leave after two years than IB - only choose PE if you’re more confident about enjoying staying at this firm through an Associate stint than you would be at a BB for two years.
Ignore title as I made the jump. As a MMPE analyst (I didn’t reneg), I would not take it. The biggest thing for me was program establishment (have analysts become associates or VPs? has the program been around for 4-5+ years?) because those things probably tell you if your analyst program will give you model ownership etc. My friend signed a 3Bn AUM MMPE shop over FT BB IB and got laid off after 8 months due to some unforeseen issues, had a terrible time re recruiting and went to a much worse bank because his PE skillset was not developed. Not to fear monger, but just to be frank about the risks.
Very unfortunate for your friend, however you can definitely also get fired in banking as well.
Either laid off, or PIP'd in your first year (in my firm, I would estimate that 10-20% of people get PIP'd).
I do agree re: modelling experience, that could make it a closer call
Agreed there. I think my main issue was that if you get laid off from JPM NYC, you can still jump to another good bank, given how many banks and thus junior roles there are. If you get laid off from a MM PE as an analyst, you may be screwed a bit more.
I respect the stealth promotion of RecruiterBase
.
curious what ur pe analyst comp ballpark is
Haven't gone through the replies but the appropriate response in my opinion is this: f 'em, they would cut you in a heart beat, business not personal, yada yada yada
They won't remember your name next week, so unless you have important personal relationships at this bank, move on and do what's best for yourself and your family
Edit: well it looks like this whole post could be spam, whatever, still an intersting topic so leaving my comment
Don't take the PE offer. Its not even full time. Do a year at the BB then recruit.
If you think hours in most decent PE shops are better than banking then you're mistaken. The shit ones have better hours sure....
Depends on if you want to go to a MF. Then your best bet is go to the bank. If you want MM/LMM PE. Go for the PE offer. --Coming from someone who was in the same situation and wanted to do MM PE and I am happy with my choice. They say you don't learn as much but that is all BS. If you do PE, you will be better at PE than a banker - as long as your shop gets high deal flow.
Current PE Analyst of two years here. I got the associate offer and skipped the 100 hour work weeks, but it took quite a few interviews and I feel less prepared than I should be. Started at a LMM firm. I would recommend taking the IB Analyst start, that is what a lot of my interviewers were looking for as I searched for associate roles.
Hey, just curious, did you accept an associate role outside your current firm?
Yeah, current firm allegedly cant afford an associate until they begin fundraising
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