I'm sure this question has been already asked but wanted to get some perspective. I went to a non-target, spent 1.5 years in audit and 1.5 years in TAS (financial modeling + FDD) and have 1 year in CorpDev.
CorpDev roles vary from company to company; however, I think I have a pretty transferrable skill set. I evaluate potential acquistions and investment opportunities in the medical space building out proforma merger models and detailed financial models. I lead DD, manage the dataroom, and help draft certain sections of legal agreements (setting NWC peg, definitions, etc...)
Outside of professional LBO modeling, do I have a shot at a industry-focused MM PE fund based on my skills? Does anyone know of any funds that have hired non-traditional candidates such as myself?
Run a search for "Corporate development", "private equity associate/vice president", linkedin.
You will find some hits - I know a few people who have made this move. However a couple things to be wary of: 1. PE funds will need to know you have the horsepower/stamina to run on deals. The view is that corporates definitely work less, and they aren't going to be happy if you leave at 6. 2. Some things are one to one, others aren't. You are going to have to sell that you can be hands on the companies you buy in addition to the deal experience. You probably have a merger integration team, or a team that helps onboard, at a PE fund you will have a hands on role with your investments.
Associate at a Healthcare-Focused MM PE/Growth Equity Firm, here's my two cents:
Think about what funds you are going to target. There are a limited number of standalone healthcare funds out there (frazier, revelstoke, windrose, etc.), you may want to widen your search to corporate vc arms (zaffre, ascension ventures, humana ventures, etc.) which can feel like a PE fund, but may be similar to what you're doing now. Point here is, there are maybe a few dozen firms that fit into the criteria you mention above, and that's excluding life sciences and med device funds that you typically need a specific background for. A lot of healthcare funds at larger MM firms will be super hard to break into based on you being non-target, so I'm not including those either.
Being from a non-target isn't going to help with the MM PE funds. I went to a state school non-target and went through the typical PE process last year, and I had a lot of trouble not coming from a top 20 undergrad program. Be aware of this, and use the "I had to pull myself up by my bootstraps" story as much as possible. I know for a fact that some firms (GA, Spectrum, etc.) won't hire at any level unless you're from an Ivy / Stanford, they lump the Florida's and Georgia's of the world in with the UNC's and IUs. This has been my experience and I didn't bother with some of those firms where the team page is exclusively Ivy grads.
Think about your competition in these interview processes at MM PE firms, most of these guys are coming from top IBs or Consulting firms. Your competition for these jobs is going to be stiff, these folks have multi-billion dollar deal transaction experience, or come from MBB. Look up these funds mentioned above, and look at their team pages. Look for funds that have associates / VPs from non-traditional backgrounds, like corp dev or operational backgrounds, or associates from MM IBs and non-target schools. There are solid funds out there that don't buy into the "BB and Ivy school or we're not interviewing you" mantra, look for and network with these funds.
Good luck in the process and don't be afraid to reach out to people you've met through your current role that may be able to help with warm intros, or even your bosses if they are understanding.
Thank you for the advice. Can I PM you with some more questions?
this is incorrect, plenty of non target Investment Team associates at GA
Do a little digging in the search, people have asked the exact same question and people (including myself) have posted pretty thorough answers.
Long answer short, it's going to be really tough for a few reasons., but the biggest is that you don't have a banking background, so you don't really have a deal oriented skillset.
Yes, theoretically you've lead DD, managed datarooms, etc, but from my experience working in Corp Dev and having worked with people in Corp Dev, often times people in Corp Dev think the work is similar, but it's actually different than PE/Banking. The pace of work is much faster, the quality and attention to detail requirements are higher, what you're looking for in a deal is different and so on.
That's in addition to you being from a non-target with a fairly non exciting background.
With all that being said, my positive takeaways are that, there are Corp Dev groups that are much more transaction oriented with lean teams that more closely mirror what happens on the buy-side. If you happen to be in a highly acquisitive group, that will help. Also, if you've done a lot of deals from E2E and can really speak to the whole process, what the thesis was, how the business was integrated, how much you paid, why you paid that much, etc and can show real thoughtful deal experience, that will obviously be important. Lastly, if you have a specific niche within Corp Dev that could be applied to a niche PE firm, those would be ones to target. If you were doing Corp Dev at a niche manufacturing company and you know of PE firms out there that invest in the exact same type of deals (and maybe ones you've even come across during buy/sell processes) you might be able to convince a firm that you're actually better than a banking analyst.
Anyways, good luck with the search. I'm not saying it's impossible, but it's going to be tough. Best of luck with it.
*Edit, just something else I was thinking about below.
Think of the ultimate goal in PE, invest in a company to make money (more or less). That informs the way you think about deals, conduct diligence etc. Now think about the goal in Corp Dev, they're multi-faceted, maybe it's to expand on a current product/service offering, maybe it's in place of building a new service/product, maybe it's to acquihire a team for expertise, maybe expand into a new market with local expertise, etc. Point being, companies rarely acquire others purely to make money and many times, corp dev acquisitions don't make money. Taking a recent example I just read about, Walmart and Jet.com. Walmart paid $3B for Jet.com and admitted that it wasn't a great straight up investment (even though it ushered walmart.com into the digital age and had lots of other strategic benefits, blah blah). So it Corp Dev, you might point to this deal and claim success, whereas in PE, you'd get fired if you did that type of deal. In general, in my limited experience, I found Corp Dev to be more strategy focused and PE more $ focused, a generalization of course, but part of the reason PE firms don't hire junior Corp Dev folks, the deal logic tends to be different.
Thank you for the detailed response. I can handle tough but glad to now that it isn’t impossible.
What do you mean when you say deal skill set? Building financial models, understanding strategic rationale and drivers of models, calculating returns, scenarios analysis, setting NWC pegs, attending management presentations, etc...?
Would you recommend the jump to IB first then?
Agree that corp dev at a highly acquisitive firm provides a good skill-set which you can try convince a PE firm, however my worry is that a recruiter may not even put you through to that stage given all the BB/MM/EB IBs and MBBB/MM consulting candidates that they can select from
Thank you for the advice. Can I PM you with some more questions?
Go for it.
As someone who explored this pathway during my career in Corp Dev. I can echo the comments from @mrharveyspecterand @slushii.
I have a background from IB and still met a good amount of headwinds in my recruiting process for PE. That is not to say I did not get looks (given my transaction experience), but ultimately struck out in different processes (although, I got pretty far in multiple processes in terms of case studies and meeting various members on the team).
You will need a convicing answer for why "PE" and understanding the firm's strategy, portfolio composition and knowing how to complete different forms of an LBO (at least a Paper LBO). You can also do practice with case studies you can find (if you cannot find one, pick a publicly traded company and run a Case Study on the firm).
Good luck as you go through the process.
Did you ever break in to PE?
I did not. I went through multiple processes (including a few runner up) but was not able to break in.
It actually worked out in the end as I stayed in Corp Dev. by transitioning to a better role. I could make a play for PE at this point given my experience but I doing alright with where my career is headed (I hope)...
I respect the progression of careers! - former big4 audit bro
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