Background: did 2 years at a top BB group (GS TMT / MS M&A / GS FIG). now a second year associate at an upper MM (many consider it a MF) PE firm. everyone else in my associate class is signed away to business school but I have opted to stay a third year to consider my options.
Situation: Ideally I would like to pursue private equity at one of the MF / upper MMs long term but after being in the industry I am beginning to see how difficult it is to move up the food chain in PE - rising the ranks to the top isn't as much of a normal trajectory the same way it is in banking. i am worried that if i try to chase PE opportunities I will be eventually be out of options and things won't go as planned.
On the other hand, I am still in contact with people from my old BB group and they say I am welcome to come back and join as associate next summer if I choose to (was somewhat well regarded there - received a direct promote associate offer when I was a 2nd year analyst). I understand that it's not a cake walk to rise the ranks in banking but I feel like I have the drive to do it.
In terms of pros and cons, I definitely make decently more in private equity than I would have in banking, but I enjoyed the fast paced nature of banking and actually thought the feeling of "sprinting a marathon" suited my general work pattern. Additionally, (and I know this is really stupid) i somewhat enjoyed being part of a larger firm and community at my old bank whereas PE firms are much smaller and somewhat closed off. I enjoy the analytical work from banking but hated industry pages / stupid client service work, but on the flip side I feel like PE involved too much due diligence on each project and isn't as "financey" as I would've hoped.
Anyone have thoughts on this? I will be spending the next few months talking to friends / colleagues about this before having to make a real decision come Fall when I would be applying to business school or accepting a banking offer.†
Just by reading your post it sounds like you want to go back to banking. Not sure if it comes off that way just because of the way you've written, but it definitely seems to be what you desire most. From an objective standpoint it's a tough call though. Lots of pros and cons for each option - you just need to decide what's most important to you and weight those variables higher in your decision.
Alot of people go into banking for the opportunity to exit into PE. Dont forget that just because PE might not be everything you hoped you might be looking back at your time in banking in a more positive light than you otherwise would have.
Don't have much other advice to offer, but this isn't a stupid reason. You liked the people and the culture better. That's as much a determinant of career success as anything else.
Agreed, that's probably one of the most substantial reasons to go back into banking. However, while associates are pretty close with each other, but there might be less camaraderie at the VP+ level
have you thought of starting something yourself or possibly doing advisory work at a start-up? have enough money saved up to possibly invest? or doing something for a company as an operations type role/corp development?
just asking because it seems like there is not "much" of a learning curve left for you in banking/PE related work being that you did 2 years at a BB and 2 years at a MF...I mean i could be wrong, but what more modeling could you possibly really learn and it seems like you prob got very good exposure to different and diverse types of deal work/deal structure.
So, besides job stability, pay, prestige and culture- what actual real NEW knowledge do you think you would gain to go back to sell side or what is motivating you to go there?
i havent started my FT gig yet but im already doing a thought process of where i would like to be after 2 years in PE or if i should even do PE so that why im curious lol
also, if you dont mind, this would really help me personally, what do you think you actually learned in PE that you u didnt learn in banking? I appreciate any info and anyone can answer as well. thanks! :)
Not to be a dick, but why the fuck would he do any of the things you suggested when he clearly wants to move up the ladder in 'high' finance? OP is considering leaving PE to go back to MS/GS because he thinks he might not be able to make it to the top at his current fund, not because he's bored. He's choosing between two options, and you just threw out 3 more really shitty ones.
in your opinion, those 3 options could be considered shitty. then again others can consider sell side hours and lifestyle even more shitty. not sure how old you are buddy but realize your opinion isnt always going to be the same as everyone else...and when someone has a valid argument you shouldn't explode on that person. Sooner you learn that the better for your own sake at least.
Look, you're always going to make more money in PE. Once you start getting equity points in the funds... that's how people end up with fuck you money.
In banking (assuming NYC) unless you end up in a senior management role, if you're a banker (traders are a whole other thing comp wise) you're never going to make that kind of money. Even if you make MD, you're always going to be sort of upper middle class in NYC.
That being said, money isn't everything. There's no shame in deciding you'd rather do banking than PE. Most of the top flight bankers (your hotshot MD types) could have gone to PE at some point in their career, but chose banking. Generally it's about the thrill of the hunt - a lot of people would rather stay in banking, shoot whales, and be involved in groundbreaking transactions as a trusted advisor to the CFO of Wal-Mart than set up shitty little arbs via garbage little companies on their own account, even if the money would be better.
And frankly, if you're the type of guy that has done PE and really decides that banking is where it's at for you, there's probably an above average chance that you'll end up in a senior management/leadership role.
This. For once someone is actually making a decision for all the right reasons. That said, I would take the long term view and think what will make you happy 10 years from now. There is always a slight honeymoon phase in your early career.
The upside to banking is that compared to the buyside your competition is a joke, getting o the top is a lot easier (still not easy). I think banking can be a nice contrarian trade (if you actually kind of like, I will never understand how anyone could not hate banking but that's just me)
Equity = meaning your PE fund has to perform well. In this industry, by far not every MM PE fund is performing on such a level that you will easily make more money than an MD.
Agree with both people that have mentioned the stability of banking relative to the risk of PE. I was more thinking larger / medium sized PE shops than fly by night operations. Even there you have to perform though. That being said, it's not like banking has the job security of some kind of federal union gig, people get executed all the time in banking as well.
I am struggling with a similar issue. In addition to the facts ricottacheese mentioned, I am also considering the risk of not being able to secure a senior associate role post-business school.
The risk / reward of spending 200k (and forgoing ~$200k of discretionary income post rent, etc.) to end up with no offer makes banking look appealing from both a cultural and financial perspective.
Thoughts?
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