From HF to Growth Equity
Anyone have advice for someone interested in moving from HF to more private investing like growth equity (not necessarily traditional PE)? I can't imagine the skillsets are vastly different between a L/S analyst and a growth equity investor. I wouldn't be surprised though if L/S requires more technical skills.
Currently in MM PE doing growth buyouts and typical growth as well. I'd say the largest difference is investment process - be ready for the "investing" part to be over relatively quickly. What follows is troops management: lawyers, bankers, advisors, etc. That takes about 2/3 of the process itself, on the back of multiple investment committees as per the different stages of the deal, terms negotiations on the SHA, SPA and LTIP and then closing. The thing is most of that is actually not tested during the interview process, where you'll likely be given a mini-LBO, some weird cap table or a test to model a particularly complex preferred or convertible instrument. But the work is substantially different and as someone looking to transition into a more investing oriented role in the public markets, my advice is to make sure you're comfortable with the switch.
As for the technicals... It's really different. On the private side, structuring plays a key role in that you need to be able to come up with structures that align incentives between the financial sponsor and the entrepreneur, which is not the case in L/S equity. Can be fun but gets old quickly.
Marc Rowan is like "hmm, what's the next obscure structure I can come up with?"
THE Managing Associate
But jokes aside, I was reading the Caesars book a couple weeks back and was surprised to see the straight forward nature of the asset sales, at least in the initial phase, like just set up this other holdco and sell assets to it at a price "approved by an independent board" lol. Was hoping for much weirder stuff which, in all fairness, did start to come up in the final phases (the rewards loyalty program comes to mind), but still not with the bang I was looking for
To make the quiet part loud for anyone else reading: this work is boring. It is akin to project management consulting which is an incredibly mundane job. It does not take any brain power and can make the job disappointing if you are not expecting it.
YES. Thanks for that
Makes me wonder why people think deals are so “prestigious”. You’re literally just running multiple process intensive projects (read: shuffling sheep around) for 90% of your time at work.
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