AMA - Top Tech / Media Corporate Development Associate

exlurker's picture
Rank: Senior Gorilla | 803

Some of you might know that i recently switched into corporate development after doing ~3 years of banking and getting promoted to associate. I'm a couple months in, but can answer any questions you may have

Update 2/21/17:
We recently completed a $200 million acquisition and are now preparing for Bolt-ons. As a result of the process, I was promoted to Manager (junior/mid-level position). Excited to continue learning, witnessing tremendous business growth and building a track record here.

Comments (59)

Dec 21, 2016

1) Are you happy with the switch?
2) How different are you hours? How different is the compensation? How different is the work?
3) What's your short and long term plan?
4) Did you end up jumping to one of your clients or found this through a headhunter/connect?

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Dec 21, 2016

1) Are you happy with the switch?
so far, i am very happy with the switch. the industry excites me and the caliber of people i'm working with is as high, if not higher, than those i worked with in ib. it is nice to finally think about the strategic implications for the different deals / partnerships we are exploring.

2) How different are you hours? How different is the compensation? How different is the work?
Only a couple months in, so I don't know the full spectrum of what my hours will be like. In November and early December, we were looking at a potential target, so one of the weeks was 9am-10pm. No weekends. Otherwise it was 9-6pm (to be fair, i did a little work at home while watching TV, but it was mostly research around target industries). I expect to stay around 8pm/10pm if a deal is getting serious, otherwise it is 9pm -6pm while checking emails once or twice after that.
My comp is $150k (80% cash) plus bonus. Mind you i joined at a slightly higher level since I did 3-3.5 years in banking (including short period as associate)
For your last question, think of it this way: In ib, you decide if the company you engage with will result in some transaction. In CD, you decide if the company you engage with fits well with your strategy and creates explosive growth opportunities when combined with your current capabilities. In ib, the transaction is the job. In cd, the transaction is just a process and the real job is solving the business problems that are associated with the transaction

3) What's your short and long term plan?
I knew banking was what i didn't want to do long term. In the short term I wanted to gain some operational experience while having a visible impact on a company's strategy and seeing these initiatives through (rather than transacting and moving on to the next client, like in ib). I haven't decided what i want to do in the long-term, so i am building the skill sets and experiences that will allow me to be an operator when i need to, while being capable of identifying valuable trends and making investment decisions

4) Did you end up jumping to one of your clients or found this through a headhunter/connect?
hh

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Jan 12, 2017

Thanks for sharing your experiences on here. As a practical question, which hh was the most useful when you were looking for corp dev roles?

Dec 21, 2016

How big is your team?
Is your team comprised solely of ex-bankers or what is the make-up of backgrounds?

Dec 21, 2016

I personally have 2 juniors below me. I report to VP as well as the SVP (who heads corp dev / strategic initiatives). We run initiatives for the whole company, but we work directly with BU heads and their direct reports. Depending on the project, it is anywhere between 3-10 people working on it (closer to 5, rarely 10 unless we are involving multiple BUs). Not surprisingly, we also work cross department so there are people in FP&A or Sales who have experience with transactions (they will chime in as needed, depending on how the initiative relates to them)

1 of the juniors is an ex-banker and the other is from industry who worked on a post-merger integration. My VP has TMT ib background. SVP has operating background and a history of transaction experience. Basically it is a good mix between transaction oriented / strategic folks. There were a couple others on our team a year ago who transitioned into other areas of the company or got poached, so we will be growing a little bit, understanding we want to remain lean though.

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Dec 21, 2016

Are you worried about slow progression or getting stuck at the VP level with no room for growth? How is the pace of advancement at your company? Thanks for doing this.

"Truth is like poetry. And most people fucking hate poetry."

Dec 21, 2016

Funny you ask that. The short answer is: not worried at all.

However, the mentality of career progression in ib is much different than cd. In ib, there's a visible path upward to MD (generally speaking). In cd, you need to go in with the mentality of learning as much as you can, driving results and then perhaps joining another company at a higher level to apply what you've learned. Overtime, the goal is to have a track record of impacting different companies in a given industry, which opens a lot of doors in the future (running cd, running a BU, joining venture arms or a range of investment firms). There are opportunities to move up to VP and beyond in the same company (slower pace truthfully), but I'm more interested in gaining varied experiences vs. staying at the same company for decades. It's scary to think about moving from company to company, since there is a sense of security in IB (where you can move up at the same firm for your whole career). But outside of ib, moving around seems to be encouraged and gives you a better skill set.

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Dec 22, 2016

Not trying to hijack your thread, but I do want to add something to aphenophilia's question.

Getting "stuck" at the VP level in corporate development is something most (including many bankers) would only dream of. Compensation would vary greatly, but ~$500k is a reasonable estimate all-in, working 9-6 most days and having a significant, strategic impact on a business can be very fulfilling. Also, no soul-crushing selling would be a major plus for most people.

Obviously bankers have a higher earnings potential, but it doesnt come without sacrifice.

twitter: @CorpFin_Guy

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Dec 23, 2016

Thank you for sharing your perspective. When I was recruiting for corp dev roles around a year ago, I was wondering why Business Analysts in my region were jumping from company to company after staying a few years in a role. At times, people remained as Business Analysts after moving to another company; it seemed that progression is slow in corp dev.

Now with your explanation, it is clearer that there can be career progression even if people from corp dev move between different companies in the same industry.

Dec 21, 2016

Did you work in your bank's tech/media group, or is this a new industry for you? If the latter, was it tough to find a job in the industry without having a background in it?

Dec 21, 2016

the former. Although I have friends who have gone into tech / media corporate development roles from a variety of groups in ib (sponsors, fig, m&a, etc). I think getting an interview for cd is very possible coming from a non-TMT background, but you will have to show you're knowledgable about the space during your interview

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Dec 21, 2016

Thanks for starting this thread.
Do you have a seperate corporate strategy team as well or is it combined? If yes what are the differentiating functions?

Are you in a high Cost of living city? I'm a post MBA corp Dev/strat manager at a fintech and my base is a lowly 105 (with no bonus opportunity)

Dec 22, 2016

Good question.. we don't have a separate corporate strategy team, we cover all initiatives from transactions to partnerships to market analysis to operational restructuring. I've noticed the BU heads also play a role where a corp strat team typically would.

I am in a high cost of living area, but prefer not to specify the city as it may give my company away. Think NYC / SV / LA.

Sounds like we are around the same level, so im a little surprised at your comp structure. My stock package was upfront with typical vesting structure. Bonus is 10-15% of the cash portion of my comp that I mentioned earlier. The bonus is a mix of stock/cash (mostly stock). Since I didn't come directly from MBA and was fully employed, I think it helped me negotiate a package ~20% higher than initially offered

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Dec 22, 2016
Guest1655:

Thanks for starting this thread.Do you have a seperate corporate strategy team as well or is it combined? If yes what are the differentiating functions?

Are you in a high Cost of living city? I'm a post MBA corp Dev/strat manager at a fintech and my base is a lowly 105 (with no bonus opportunity)

Analyst in corp dev here. 105 is definitely low if you're at a F500 type company and/or in a major city, even cheap ones. If it's small fintech, perhaps you can negotiate some stock.

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Dec 22, 2016

Would you like to share a little about your experience as an Analyst at CD? Want to see if your idea of career progression is different since you are starting at the analyst level.

What is your comp package like?

Also agree that 105 is on the lower end. First year associates in cd could reasonably expect $120k comp package

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Best Response
Dec 22, 2016
exlurker:

Would you like to share a little about your experience as an Analyst at CD? Want to see if your idea of career progression is different since you are starting at the analyst level.

What is your comp package like?

Also agree that 105 is on the lower end. First year associates in cd could reasonably expect $120k comp package

At some point I'll make a thread, but happy to answer any questions you might have here for now. I did ~2 years in banking first, then went into CD. For people in my position, I think the norm is base ~100 and bonuses of 10-20%. So about flat (can be slightly lower) compared to IB analyst salaries, but you're working ~50 hours instead of ~80+ (during deals you can get >60). Raises are 2-3% a year, so pretty small unless you get promoted. Hierarchy is analyst - manager - director - VP - SVP. Most analysts / senior analysts come from banking. I think the quickest career progression you'd see at a large public company would be becoming a manager around 26-27, maybe a director at 30, VP by 33-34, and SVP in late 30s. It all depends on the situation though. If you're an analyst or manager and your VP / SVPs are pretty young, it'll be tough to move up if they don't leave.

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Dec 22, 2016

It's a large publicly traded company in a somewhat low cost of living city. Sounds like it's time to get a new job!!

Dec 22, 2016

Thanks for doing this. Two questions on my end:

1) Please don't take this the wrong way - but how "respected" do you feel the corp dev / strategy team is within your company? I'd be curious to get your thoughts because I've heard very varying opinions amongst friends who have made the move to corporate. Some have told me that the corp dev / strategy team is extremely well-respected because it is filled with the most talent (ex-IB / consultants) relative to other folks in the company (and thus they get compensated the best). However, others have told me that the power / authority lie with those with P&L responsibility, and the corp dev / strategy team is a cost center at the end of the day (and thus they get compensated less than line roles).

2) What does comp progression look like once you make it up the ranks to VP and SVP?

Dec 22, 2016

1) It depends on the company. I know you're probably looking for one answer that you can generalize for the entire field to help you decide whether it is something you should bother pursuing or not. Truthfully, it depends on the company and it is up to you to find one where the situation is positive for you and your career.

luckily, i found a company where the cd team gets to work pretty closely with the c-executives (SVP heads corp dev/strat at my company). We also get to work with the BU heads. OVerall it is a collaborative culture and we all bring certain skill sets to the table. It is far from a cost-center. remember, companies start cd teams when they need to find ways to bolster growth inorganically. Without a cd division, companies risk entering years of slow growth, which pisses off investors and other stakeholders. We get high stock-comp since our performance can visibly impact the value of the company.

As i said earlier, i was an Associate in ib so a deciding factor for me was that my experience had to be better in cd, especially with the trade off in comp. I think we are very well respected within the company and externally. people in ib try to line up meetings with me. People from industry ask me for coffee. I connect a lot better with people in different departments (FPA, marketing, etc.) because i don't have the intimidating "ibanker" stamp on me. These are all high-caliber individuals too, who came from top schools and top firms, and have great track records within their respective fields. I'm in a very liberating position.

I agree there are companies out there where cd won't be respected, but it's easy to filter out those companies when you're interviewing.

2) Varies so much that i can only give you directional answer at best. Expect comp to go up ~$10k per year within a given rank. A promotion to the next step in the ladder (associate to manager to vp to svp, etc.) will give you a chance to negotiate for ~20% more than your current comp. Remeber in banking it's 3 years in each level, but in corporate it can be anywhere from 2-5 years. I think vp at my company clears just under 200k in cash, but a lot more stock than i get right now (at least double). based on today's value, their unvested stock probably gets them $30-50k per year as it vests (stock is taxed more favorably so this is similar to a ~$50-60k annual cash bonus). So VPs could clear ~$250-300k all-in, where the cash portion is fairly stable and the stock portion offers big swings (for better or worse). SVP could clear $500k+. I don;t know their specific comp package and cash / stock mix because most people negotiate their packages based on their past experiences and track record (unlike banking where there is a market price and standardized bonuses at levels below MD). It is probably heavier on stock, so $200-225k cash and rest stock. At the VP and SVP level, you're old enough and experienced enough to be able to demand a comp package for yourself too.

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Dec 23, 2016
exlurker:

I agree there are companies out there where cd won't be respected, but it's easy to filter out those companies when you're interviewing.

What is your criteria to assess which are the firms that respect their corporate development teams?

E.g.
1. Access to C-suite and other business units (depending on the kind of upcoming projects)
2. Outsource some work to MBB
3. The whole organization's corp dev team consists of a group of 1 director and 1 intern/analyst in charge of N./S. America, a similar group in charge of EMEA, and a similar group in charge of Asia

Dec 22, 2016

Thanks for doing this.

What kind of exit opps do you see if one leaves CD at the analyst/associate level? Moving into another part of the company is a common option, but curious as to your take on external opportunities.

I've read some things posted on WSO regarding this, but it has varied a bit from what I've seen in real life.

Dec 22, 2016

How cool would it be to move up to VP in the next few years!

Now that i am out of banking, i've adjusted my perspective on career progression. I want to remain open to different opps as they come along. It is possible we acquire a business where i've played a critical role in the process, and am asked to help run the BU. it is possible i could help out another company. I could potentially follow one of my superiors if they move around.

More commonly, I see people move around after a few years to corp dev at diff company (at a higher level), join an operational team, go to bschool, go into VC, go back into banking (1 person got an offer they probabnly couldn't turn down). PE not so much but i have 1 friend who did (not that the others couldn't do it.. they were just the only ones actually interested in going into PE). Also seeing people in my network moving into corporate venture arms. Anotehr friend of mine got married and is taking a few months off. They told me they were going to look at other corp dev opps when they are back from their vacation.

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Dec 23, 2016

VP would be fantastic although that's quite a few years away.

From my experience (this is solely based on my group and some others I know in the industry), the first things you mentioned seem to be the norm, especially at the manager level and above. A few analysts/associates have jumped shipped to corp dev at another company as well.

Curious as to how to make the jump to VC. Was it through contacts they made from deals, head hunters, something else?

Dec 22, 2016

Do you see consultants who work within the M&A come over to CD? I work in the M&A Strategy space (Integration, Separation, some buy-side and sell-side due diligence, and overall post merger strategy) and am interested in the space

Dec 22, 2016

I have not seen this happen yet. I am sure it has happened somewhere though. If i saw your resume, i suspect to see the skills needed to perform well in cd, so you would likely get an interview. But cultural fit and your knowledge of the space will set you apart from the rest. at my company, a mix of TMT / M&A experience is advantageous, but we hire based on how you perform in you rinterview and if you can bring something to the table for us.

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Dec 22, 2016

You mentioned having buddies from sponsors make the move to corp dev at the analyst level. At the post-MBA associate or VP level, do you still think corp dev is available for individuals in FSG or lev fin? Or would they strongly prefer someone from a relevant coverage group?

Dec 22, 2016

I would think post-MBA VPs at a PE shop would only really be useful in corp dev if they were in a relevant coverage group. At that level, if you're joining corporate, you need to bring some proprietary industry knowledge to the table.

But it is definitely available for people with the background you described at companies where the cd team's purpose is to primarily process transactions.

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Dec 22, 2016

What you do sounds pretty cool, especially considering cost/reward. Do you see many new grads come into your company and work their way into CD or does your company strictly take from banks and other firms? What are you doing on the day-to-day? I don't need an exhaustive run down but a general idea would be awesome.

Thanks

Dec 23, 2016

It takes longer to work your way up right out of undergrad. An analyst might take 3 years before becoming an associate. 1-2 years of banking can get you to associate right away. 3 years of banking can get you to senior associate.

We'll look mostly at ex-bankers for positionsnin cd because of the relevance of the skill set. It's also easier to find someone with transaction experience in TMT at an ib as opposed to a consulting firm.

My days consist of internal strategy meetings, catching up with BU heads, doing independent research, meeting potential targets, or meeting with bankers / industry experts. At the end of the week I try to come up with something actionable based on our strategy meeting from earlier in the week. I present my recommendations (can be formally or informally) and then we go from there. Sometimes initiatives come directly from the top, in which case it reminds you a bit of how you get staffed on projects in banking.

When there's a deal, we spend a lot of the day coordinating with bankers, lawyers, consultants, etc.

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Dec 23, 2016

Thank you for doing this.

  1. At your firm is associate the most junior corp dev position? What is the progression like at your firm?
  2. Do you mind if I ask about compensation?
  3. I hate asking an interview-type question, but where do you see yourself in ten years?
  4. What tips/tricks have you picked up on the job so far that you think are good to know for corp dev? I spent two years in banking, so I'm sure we have a lot of overlap, but it's always good to hear what other people think.

EDIT: My apologies, but it looks like progression and comp were addressed above, so feel free to ignore.

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Dec 24, 2016

Associate is most junior ( we are hiring an analyst to help too). I am between senior associate and manager (will be promoted after 4 more months to manager).

Associate - senior associate - manager - director - VP - SVP

my comp is ~150k as I mentioned earlier. I might be on the higher end

In 10 years I don't know yet. Coming out of banking meant that I would lose visibility of this (in banking you could say MD or some high-level executive position). For me in 10 years I hope to have developed a track record of growing and operating companies in fast-growing / rapidly changing industries, and to be able to use my experience to find new opportunities to invest in and participate in operating. A little vague but that's the answer i have for myself right now.

To be continued

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Dec 24, 2016
  1. I think keeping up with the industry is one of the most valuable things you can do at our stage. The reason I say this is because you're expected to do good analysis. If you do perfect analysis then you've done only what you're expected to do. But if you read up on the industry, you're able to speak up and contribute strategic ideas. That's what these corporate guys need when their industries are undergoing disruption.

I do this by having a mix of formal and informal meetings with industry folks, bankers (some are senior bankers i had relationships with and some are peers). I read a lot. This is the kind of stuff I hope not only sets me apart, but gives me credibility in the eyes of my seniors.

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Dec 23, 2016

Thanks for the AMA. It's great to learn more about CD.

1) What's the typical CD interview process like? Not so much the headhunter process, but the interviews themselves.
2) Do you see many post-MBA IB associates joining CD? If so, how does their process, entry position, career progression, and exit ops differ from an IB analyst or pre-MBA associate (like yourself)?

Thanks again!

Jan 2, 2017

Apologies for the bump. Would love to hear the OP's perspective...

Jan 2, 2017

Responding tomorrow

Jan 3, 2017

Interviews are a bit of a blend between IB / PE, with less focus on nuanced technicals.

  1. starts off with your story, why IB, why a switch to corp dev, why the selected industry and company you're applying for. This part is pretty easy because you generally apply for industries that you are passionate about and buy in to their vision
  2. walk through prior projects / deal experience. This is high-level, talking about the story behind your deal, some of the problems the client faced along the way and the eventual outcome. It is better to talk about projects that had a strategic angle instead of only talking about deals you closed. In corp dev, you can imagine a lot of deals die in the diligence stage (lucky if you can get that far), so there is a lot of emphasis on understanding the big picture and what metrics are important when thinking about strategic fit of a deal (since that is what your job will consist of)
  3. modelling questions, with questions around accretion / dilution, LBO / IRR, synergies, ROI / break-even, etc.
  4. Industry discussion. By this point in the interview, it's more of a conversation than a Q&A. You'll both be asking each other questions on the company, industry, etc.

My interview was 4 rounds - VP, Juniors, SVP, and then once with the whole team (CEO, CFO were also there). Interviews become less about technicals as you progress through the rounds as i am sure you would expect. Where you shine is how well you can communicate your understanding about hte industry and what questions you as

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Jan 3, 2017

Unfortunately, i dont personally see many post-mba ib ASSOCIATES going into corp dev. At that stage, it seems like you'll want a manager-level position in corp dev (assuming you're in late-20's), but you lack a lot of the in-depth industry experience. I am not saying it is not possible to jump into corp dev, i just think there are other candidates out there with a combination of prior deal experience as ib analysts and industry experience. This is the reason i wasn't able to join at the manager level right away. Also, i am mid-20s so the role i applied for was in line with what i typically expected.

However, if you are a pre-mba IB associate right now, with industry experience pre-MBA, your chances at cd are as good as anyone else.

Definitely apply for cd with a company that genuinely interests you and do your best to stand out, but also look at other industry opps or be willing to take a step down the ladder in order to transition.

Dec 24, 2016

What are your thoughts on business school? Your comp / responsibilities is at similar level as post MBA grads as you spent 3.5+ years in banking, but do you see your career in corp dev / corp strategy getting limited as you move up to manager + level because of the lack of top MBA? Is there an option of doing part time down the road to mitigate that for you?

Jan 3, 2017

I am on the fence with b-school still. I think it is something you do when you know exactly why you are doing it. Typically see people go to b-school when they need a platform for a career transition. Tbh there will always be companies out there that require MBAs to move up, but there are also many companies that are more meritocratic (I am at a company that believes in meritocracy, so i don't see an MBA being necessary to move up). However, as i mentioned in another response, it takes a while to move up in a company regardless, so most people lateral to other companies as a ways to move up quickly. If the company you lateral to has a lot of seniors with MBAs, then it is probably necessary to get an MBA to get to their position at some point in your career. If not, then it makes more sense to deliver results as a way to get promoted.

Right now, i don't think i want to get an MBA due to the opportunity cost. I see a lot of trajectory at my career right now, but will consider it later down the road when i feel like it will be helpful. No need to decide right now, since that door will always be there when i decide the time is right for me.

As for the "part-time" comment, i don't see that offering the same value as full-time, since MBA is a time for you to focus on the holistic experience (building relationships with students, professors, etc.; exploring different hobbies you didn't get a chance to while working full-time; learning about other industries or job functions; etc.)

Jan 3, 2017

Currently in an F200 FLDP with an opportunity to rotate through Corp Dev or Corp Strat. Thanks for this AMA, it's helpful to see what the opportunities look like in specific areas in corporate finance.
You said that you did 3 years of banking and just started in CD. Would it be correct to assume that you're 25-26 years old, or did you do something else for a few years? Do you feel like you'll need an MBA at some point in the future to keep advancing?

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Jan 3, 2017

Your assumption is correct: 25 (graduated at 21 and did a bit over 3 years in banking as an analyst / associate).

I responded to Blueshirt about the MBA question a minute ago. But in summary, I don't feel like it will be valuable for myself at this point in my carrer, considering the trajectory i have right now. I will consider pursuing a full-time MBA program when i'm convinced that a future opportunity will require it or when i need a platform to transition my career. Of the people i consider successful, most of them do not have MBAs and the ones that have MBAs had an engineering / science background prior.

Jan 5, 2017

Thanks for the answer!

As I said, I'm currently in an FLDP that offers an opportunity to rotate through corporate strategy and corporate development. At my company, those groups are different. My short-term goal is to be in a position similar to yours: Researching and carrying out M&A opportunities for a company (or being part of the team that identifies and carries out money saving projects for the company). Do you have any advice on how I could get there?

My current rotation is a product-line controllership role. It has some forecasting, but is mostly cost tracking. My thought is to have my next rotation be in corporate FP&A, and then to have my 3rd and final rotation be in corp strat/dev with a goal to try to stay after the end of the program.

  1. What are your thoughts about someone breaking into corp dev without a banking background?
  2. Is there a different pre-corp dev rotation I should shoot for (besides FP&A)?
  3. Lets say my company doesn't let me stay on the corp dev team after the end of my rotation. Do you think a year-long rotation in corp dev would be enough to try to get on the CD team at another company?

Thanks again for your time.

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Jan 3, 2017
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Jan 12, 2017