CPP Investment Board 2020 Updated Reputation and Exits?

Hi,

Was interested in an updated commentary on CPPIB's reputation, comp, exits at the junior level. I am particularly interested in it's private investments division and its rotational program for direct-out-of undergrad analysts.

Is there a precedence of people from CPP going to top MF's and/or top HF's in the states?

Thanks.

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Comments (15)

  • Prospect in Other
Jun 12, 2020 - 2:25pm

For this - Is there a precedence of people from CPP going to top MF's and/or top HF's in the states? Short answer is: No.

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Most Helpful
Jun 17, 2020 - 5:34pm

I can give a pretty unique insight on CPPIB since my best friend works there, but please remember that this is all second-hand information/my own personal observations.

In terms of precedence of exits, CPP has some history of people moving to other private funds (Apollo, Onex, Brookfield, Ashler Capital, Global Infrastructure Partners are some of the notable ones - someone ended up at Tiger as well) but, the exit opportunities Toronto global banks are definitely better than CPPIB (GS/MS/BAML/CS etc. have sent people to TPG, H&F, Silver Lake, Oaktree, Carlyle)

At the same time, I'm not exactly sure why anyone would leave given how sweet a gig working at CPPIB is. My friend has an exceptional lifestyle (9-6/7 with pretty much no weekend work except on super live deals), pay that is slightly-to-significantly lower than street (Analyst 1 is 120-140k annualized - not sure about other ranks), low stress, and more interesting work. I'm sure there are differences between the group so I can't really speak to that but from what I've heard their energy, infrastructure, PE secondaries and credit groups are well-regarded but I'm not 100% sure.

The other thing is that for many people CPP is the exit as there aren't that many reputable buy-side seats in Canada, so many talented Canadians who did their banking stint in the US and are looking to come home end up at CPP/OTPP.

At the end of the day, it really depends on what your goals are. If you're completely sold on the 2+2 "mega-fund golden path" than you would be better suited for doing a banking stint, but if not, CPP is a wonderful place to start a career. My friend seems genuinely happy to work at CPP, loves his job/coworkers, makes good money (especially adjusted for hours and stress), and makes me wish that I took the company more seriously when recruiting out of undergrad.

Hopefully this helps

  • Prospect in IB - DCM
Jun 18, 2020 - 8:12am

I really appreciate the thorough insights. As a quick follow up, based off your perceptions, how would you recommend choosing between CPPIB Private Investments vs a Big 5 Canadian Bank if I would want to make the eventual switch to PE in the US? Thanks again

  • Associate 1 in PE - LBOs
Jun 18, 2020 - 11:27am
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At the same time, I'm not exactly sure why anyone would leave given how sweet a gig working at CPPIB is. My friend has an exceptional lifestyle (9-6/7 with pretty much no weekend work except on super live deals), pay that is slightly-to-significantly lower than street (Analyst 1 is 120-140k annualized - not sure about other ranks), low stress, and more interesting work. I'm sure there are differences between the group so I can't really speak to that but from what I've heard their energy, infrastructure, PE secondaries and credit groups are well-regarded but I'm not 100% sure.

Interesting. My source at CPP Toronto said the direct PE team gets crushed (10pm-12am week nights), and weekend work (though don't recall getting a read on weekend hours). Have heard better lifestyle for the credit-related roles. as expected.

  • Associate 1 in PE - LBOs
Jun 18, 2020 - 6:00am

Highly group dependent - some savvy. When looking up profiles of ex-CPP folks who have transitioned to GP, make sure to check their groups. Different groups have different caliber and street cred. Canadian market overall is not very liquid; doing banking allows you to still go to US (better and more solid training, a resume that people can understand, no pre-earned self-satisfaction based on "having worked in buyside post undergrad" which unsurprisingly results in more open mindedness and better attitude), which is arguably a better market.

(Look at the high turnover rate of MM/LMM funds in Canada; seems to suggest some difficulty in being truly competitive in a pan North America context)

Mar 26, 2021 - 11:11am

Other than lifestyle, low stress and interesting work, what would be the key learning benefits or experience from working in the CPPIB PE team (vs. a buyout fund or MF)? I've heard pension funds ask this in interviews and candidates who say "better lifestyle, low stress" definitely don't sound very convincing...

Apr 2, 2021 - 9:39pm

Yeah saying "better lifestyle / lower stress" is a really bad interview answer. It would imply that you're not as worried about losing money or making good investments as you would be at a MF? And either way I'm sure deal processes are still quite intense - don't think are many ways around that, even if it isn't as bad as it would be at a MF. Other appealing things could be

  • You are able to invest for the long term instead of looking to get quick wins so you can raise another larger fund
  • Those types of funds are the ultimate beneficiary of the investment returns (instead of generating income off the carry and management fees), so you can be assured there is no possibility of misaligned interests between you as an investor and your LPs
  • You have a huge permanent capital base, so you can focus entirely on investing and don't have to worry about reporting to your LPs or fundraising or anything else like that
  • Analyst 2 in PE - Other
Apr 5, 2021 - 1:30pm

Some good points already mentioned. I'll add in a couple more based on my experience:

- Longer term investment horizon allows for more time to execute on value creation initiatives. Pensions aren't known for this but they're still ramping up internal capabilities for this function

- Capital from a pension fund vs. a GP (esp. MF) is viewed differently and in some cases in a more favorable and friendlier light; very qualitative point but it is an 'edge' in some instances 

- At a place like CPP, you'll likely have the flexibility to work on global opportunities 

-  CPP isn't your typical pension - they lead direct investing on large (often complex) transactions and go head-to-head with MFs in some cases. Just looking at recent exits from their various groups, I think its a great place to start/continue your investing career 

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