Current 1st Year M&A Analyst – Should I Accept A Sourcing Analyst Position?

Analyst 1 in IB-M&A

Hi all,

Recently received an offer for a sourcing analyst position at a recognized PE firm with >$15bn AUM. For context, I've only been on the desk at my LMM firm doing M&A for ~5 months. If my end goal is PE/Growth Equity, is this a blessing or a stupid idea? I know the traditional move is 2 years > associate but I genuinely liked the culture of the people I've met at the firm and they also mentioned a potential path from Analyst to Associate in ~3 yrs. I'm biased towards a yes but would value your input so I don't make a rash decision.

Thanks!

Comments (17)

Nov 26, 2019

Depends on if you want to spend time on the road doing BD for the next three years.

...and if that transition is true.

  • Analyst 1 in IB-M&A
Nov 26, 2019

BD? And I will totally confirm with them to make sure whether the potential transition is true of not.

Thing is, the firm in the PE space is so much more well regarded than my firm is within the IB space. I almost think there'd be a very low shot I'd make it to associate directly otherwise... big concern here also is comp honestly.

Nov 26, 2019

What do you mean by on the road? Like consulting type of travel pitching companies

Nov 26, 2019

The sourcing analysts I have interacted with have all been business development roles.

On the road meaning flying from city to city to meet with sources of deal flow (attorneys, accountants, investment bankers, etc.) and go to transaction related events (ACG, etc).

Probably a lot of time on the phone calling these folks as well.

  • Analyst 1 in IB-M&A
Nov 26, 2019

For sure that makes sense - definitely strong elements of a sales role. But do you not think the brand on my resume of a hybrid experience in both IB and sourcing at a well-known PE firm would go a long way?

  • Analyst 1 in IB-M&A
Nov 26, 2019

No - it will silo you. I assume this is PSG and your bank is a Suntrust/Stifel/Stephens level bank. You will be siloed,

Better move would be to lateral banks and recruit for investment positions.

  • Analyst 1 in IB-M&A
Nov 26, 2019

PSG would be a solid comparable. And tbh, I don't know if I could survive three more years at a bank - especially if I lateral for a more "prestigious" shop. I like the idea of being able to leverage my social skills while still having a top job within Finance. Am I misconstruing something? Not sure how it could be so siloing.

  • Analyst 1 in IB-M&A
Nov 27, 2019

Bump

  • Analyst 1 in IB-M&A
Dec 2, 2019

Bump, please help. Offer expires soon!

Dec 2, 2019

It's not a step up. Sourcing analysts aren't treated like regular investment professionals. I wouldn't expect opportunities to be good coming out of it except to do sourcing or fundraising.

  • Analyst 1 in IB - CB
Dec 2, 2019

What if it offers a potential path from A2A? In that case, wouldn't it be a "step up" especially if its at a notable fund coming from a LMM/MM IB background where the (best case) seems to be MM PE?

Dec 2, 2019

I would be shocked if any reputable fund offered that as a path. Maybe they'll claim to but I'm sure the conversion is terrible or takes 3 years with zero certainty. You just won't develop any of the skills you'll need as an investment associate so what's in it for the fund?

Most Helpful
  • Analyst 2 in IB - Gen
Dec 3, 2019

I think you are missing something. Most software PE shops are sourcing based and thats part of the Analyst/Associate program. Providence, TA, Summit, Level Equity, Catalyst, Marlin.. all Analyst are involved in sourcing or primarily sourcing until they hit Associate where sourcing becomes a small % of your workload.

Also sourcing isnt just picking up the phone and dialing, as most think on this forum.

This is not 80's and days of value creation only via leverage ar gone. No one who understand anything about value creation and returns questions this theme of sourcing prevalent across PE (Tech focused PE for obvious reason)..

The best way to pull this off and not be labeled as the sourcing person would be to do exactly that for two years, grind, get Assoc promote, and then quit a year after Assoc title..so you have a well rounded experience. But honestly, this theme is pretty common across a numbers of shops unless you have the golden ticket to WCAS/Vista/Thoma Bravo

    • 3
Dec 4, 2019

This was super helpful advice. Could I PM you for some more info?

I am the real boss baby.

  • Intern in PE - Other
Dec 3, 2019

I'm still an intern in undergrad so please take this with a grain of salt... I've been interning for an MD on the sourcing side for ~9 months cumulative and can say there is a large sales emphasis. He is constantly on the road at ACG's and other similar conferences looking for new contacts (which I will eventually log into sales force), deals, etc. If he isn't at conferences he's meeting with I-bankers/Senior Lenders to discuss either potential deals or deals that are in stage 3-4. This is a smaller firm so he's usually part of the deal team, but his main responsibility seems to be putting meat on the table for partners to either decline or sign off on. I'm not sure whether an analyst in sourcing would be traveling as much, or if they would be helping track these deals by logging them, signing NDA's, and other similar tasks. Again I'm just an intern and only know a small fraction of the other feedback you've received, but that's what I've seen.

  • Analyst 1 in IB - CB
Dec 3, 2019

Bump

  • Analyst 1 in IB - CB
Dec 4, 2019
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