Equity Research to Corporate Finance?

I've been an ER associate for about 2.5 years at a regional bank outside of NY and want to get out of the industry into something a bit more stable and with a decent work/life balance, as both are lacking in my current role. After doing a bit of research on corp. fin I'd like to get into either an FP&A role or a treasury role if possible. Has anyone done this before or know what types of roles I should be shooting for? Seems like most FP&A analysts get hired right out of school so should I be aiming for something higher up or aim to start as an analyst? I'm thinking networking is my best bet but would it be weird to cold email/message people on linkedin now that I'm out of college? Any help would be appreciated.

I graduated from a non-target and have passed two levels of the CFA (was gonna take the third this spring but Covid ruined that).

 

Comments (19)

 
Aug 24, 2020 - 5:33pm

Thanks, is there anything specific/obvious I should highlight on my CV/cover letter that would appeal to someone reading them in corp fin? I've been cold applying online and unpleasantly surprised by the lack of hits I've gotten (I know the hit rate won't be high but mine is abysmal). Agreed on IR, but longer term I'm not interested in it - would that be a way to get my foot in the door and then lateral later? Seems like an unnecessary step now but I'm also not familiar with the corp fin. structure.

 
Aug 24, 2020 - 1:42pm

I'd focus on compensation rather than title. Alot of companies pay their Senior Financial Analysts less than what I make as a Financial Analyst. The transition shouldn't be too difficult, especially if you target your coverage industry.

No reputable company will hire you as a finance manager so FA or SFA should be your target role. Investor relations, as previously mentioned, is always an option.

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Aug 24, 2020 - 5:42pm

Thanks I appreciate the advice, is there anything obvious I should be adding on my CV? I have my coverage industry, research pieces I take the lead on (weeklies/monthlies), initiations and valuation/financial modeling. Also have CFA + associated licenses for ER.

Agreed about IR, I don't want to do it long term so that's why I'm targeting FP&A type roles (or treasury but those seem a bit harder to sell my current skillset into)

 
Aug 26, 2020 - 9:23am

NegativeNPV

Thanks I appreciate the advice, is there anything obvious I should be adding on my CV? I have my coverage industry, research pieces I take the lead on (weeklies/monthlies), initiations and valuation/financial modeling. Also have CFA + associated licenses for ER.

Agreed about IR, I don't want to do it long term so that's why I'm targeting FP&A type roles (or treasury but those seem a bit harder to sell my current skillset into)

I think you're covered as far as qualifications. You are likely over qualified for a financial analyst role. Just make sure your story as to why you want to leave ER is solid and shoot out those applications.

Array
 
Aug 25, 2020 - 10:08am

IR would be a good way to get your foot in the door. Even as a junior IR person you would get some exposure to the executives and give yourself a better shot of standing out and getting moved into another group if that's what you want. 

 
Aug 26, 2020 - 9:29am

Depending on the type of company, the IR team likely had solid intersection with the corporate finance side and you'll get to learn whether or not you like corporate finance without directly working in it. You'll also likely be more valued in an IR seat initially as your skillset is more aligned to that work than it is to the corporate finance side. Once you've built tenure on the corporate side, it'll be easier to move upwards on corporate finance if you want to. 

 
Aug 26, 2020 - 3:56am

Equity research professionals are responsible for producing analysis, recommendations, and reports on investment opportunities that investment banks, institutions, or their clients may be interested in.  The Equity Research Division is a group of analysts and associates at an investment banking (sell side), an institution (buy side), or an independent organization.

The main purpose of equity research is to provide investors with detailed financial analysis and recommendations on whether to buy, hold, or sell a particular investment. Banks often use equity research as a way of "supporting" their investment banking and sales & trading clients, by providing timely, high-quality information and analysis.
The main work in equity research is producing reports.  Ranging from quick updates or "flash reports" to in-depth, "initiating coverage" reports, the job of an equity research associate or analyst is to constantly be publishing. Another big part of the job is financial modeling.

 
Most Helpful
Aug 31, 2020 - 10:25am

Please do yourself a favor and find something else to do. I've worked in sell side equity research at a bulge bracket, investor relations at a $10B+ market cap financial institution, and now FP&A at a megacap bank. I know sell side sucks and is a grind, but leverage that experience into something more interesting. IR and FP&A will not provide you with better hours and the comp sucks. Also, I wouldn't call FP&A stable. It's a function that is becoming more and more automated and is already heavily outsourced to teams overseas. The work itself is very low value, routine, manual processes which becomes hard for reasons that have nothing to do with one's intellect. Also, the people that work in FP&A aren't the brightest. I used to work with what felt like the best and brightest on the sell side and now I spend my days listening to my team argue on zoom for 1.5 hours on a Friday late afternoon on how best to craft a four sentence email to send to other FP&A teams requesting data for quarterly earnings. FP&A is really just about pulling a bunch of uninteresting data from whatever financial information ssytem your company uses into excel, making a bunch of waterfall charts to explain various drivers, and compiling monthly, quarterly, etc. variance tables to explain differences from actuals versus the budget. It's horrible, mind-numbing work and add in a bunch of required weekend work for quarterly earnings and ad-hoc management requests, late hours, terrible pay, stupid people, and you have the perfect storm for an awful, pigeon-holed career that will be fully automated in the next decade. 

 
Aug 31, 2020 - 3:22pm

Lot going on here. Thanks for the candid response, I think it's good to hear feedback like this even if it makes FP&A sound super shitty. Couple follow up questions/points:

1.  I work at a smaller bank and comp already sucks, so there doesn't seem to be much difference there. In my current role the hours are generally 7am-5:30/6pm during the week with a few hours on Sunday and way worse during earnings. In your experience is FP&A the same?

2. This is the first I've heard of FP&A being automated so that's making me reconsider, is there another corporate fin type function that you think is more interesting/less likely to be automated? Corp Dev comes to mind for me but idk how feasible that is for my background. Feel free to throw out anything outside of corp. fin, I'm looking for a role with less stress (not interested in buyside unless its a LO which is very difficult given my background), normalish hours, and ideally somewhat interesting work (this being the most negotiable, which is why I started looking at FP&A).

3. You mentioned people in FP&A being not the brightest but that seems like a positive to me. If you're smarter can't you outwork/outsmart them and get promoted faster? I'm sure there's politics involved but I don't think it's that hard to be well liked, just do your job and be sociable when needed. If promotions are based on ass-kissing or team performance than I can understand your hatred a bit more.

4. Do you know anyone else in industry that has the same experience you do? It's possible you work for a shitty bank (If its Wells or Deutsche your post makes so much more sense) and your experience isn't the norm.

5. You said you worked in IR as well, how did that compare comp/hours wise to FP&A and ER?

 
Aug 31, 2020 - 4:04pm

First, broadly speaking there's definitely different types of FP&A, but I think most types are tied to the quarterly financial calendar/earnings which is the worst kind of FP&A imo and the type I work in currently. 

1) Yea my hours on a good day are 8:30am to 6/6:30pm....there's still a stupid face time culture at the place I work at. Some days I literally do nothing all day and then get bothered for something at 5:30pm and they say it needs to be done that night, so then working until 9/10pm. Earnings is terrible and each quarter I have multiple 2am nights in addition to the full saturdays and sundays which are in the office and have a set schedule...At a min I need to block out two full weekends (sat & sun) each quarter in addition to the company's annual investor day at a minimum, then there's ad hoc stuff which they may require weekend work. Not as bad as sell side / IB but still terrible relative to the comp and what you can do with your life after. 

2) Almost everything has potential to be automated. Listen to Andrew Yang's audio book it's pretty depressing. FP&A is super easy to outsource and automate and I see this trend accelerating. So many useless people pushing crappy excel files around all day to each other....They are all a waste and will be permantently displaced over the next decade. Jobs that require high brainpower will be ok, FP&A not so much. Corporate Development/Business Development whatever you wanna call it is definitely a solid option. Just get the whole work life balance out of your mind....If you work for a Fortune 500/S&P500 company they own your ass and will constantly remind you of it....Mon-Fri 9-6pm just isn't a thing anymore in this country sadly....Also, corporate strategy is solid and interesting....just be careful a lot of roles sell themeselves as strategy and they aren't....But you are right...almost impossible for you to get into either of the above...corp dev/biz dev wants former bankers and corp strategy wants former McKinsey type consultants....and both will want direct industry experience...big uphill battle if you are trying to get without B school. If you want low stress and normalish hours seriously consider government jobs or some random job in an office...just be prepared to make the median wage in the location in which you are based and nothing more...if you worked sell side to begin something tells me you prob want more in life...im not knocking people that want an easy life, but easy life comes with middle to below middle class pay.

 

3) Forget this theory....doesn't play out in real life. When you work with stupid people and the entire management is stupid as well they don't appreciate smart people...everyone is super insecure and trys to keep each other down. It's unfortunate, but one thing I miss about working on the other side was that merit actually mattered and they appreciated it. I respected the people I used to work for and constantly learned so much from other smart people. Today, the opposite is true and my brain is rotting every day. Being surrounded by smart, motivated people will only make you better. Big fish in a small pond theory doesn't seem to work out in my professional experiences. 

 

4) I am a bit unique...take my advice with a grain of salt...hopefully someone else posts in this chat and agrees with me if it gives you more comfort. One key difference between me and you is that I took a huge pay cut and had expectations similar to yours, sweet hours, big fish in small pond theory, work that wont be automated, etc. and have been really disappointed. If you are able to lateral and still make the same comp then you may be happier than me. 

 

5) IR is equally as bad as FP&A in my opinion. The only interesting job in IR is to be the head of IR and they almost always had a big job elsewhere before...haven't seen many start at the bottom of IR and work their way up to become head of IR...Junior level in IR is like being a high end concierge/waiter for upper management....pay sucks and hours suck.

 

 

 
Sep 4, 2020 - 6:59am

I have a similar experience to BobTheBaker at a pre-IPO company. Corp FP&A vs. BU FP&A or strategic finance at an earlier stage company can be very different. I did a Corp FP&A role for 9 months and quit vowing never to go back. I get the sense that BU FP&A at least you're in the operating weeds and really owning a bottoms up forecast. At the pre-IPO company, while I was responsible for forecasting revenue (someone else handled opex, month end close, the consolidating model), I was also involved in a lot of business partnership -- ad hoc analyses, modeling new programs, new countries with biz dev, working with marketing to understand ROI, LTV/CAC and conversions, working with purchasing on cost improvements and operations on improving utilization, as well as being involved in acquisitions and fundraising and ultimately the strategic exit. I think the strategic finance position could you position you well for a VP finance/CFO type role other similar stage companies.   

I'm now in a capital markets focused treasury role for a public roll-up company. We issue a lot of debt to support acquisitions so I'm working on cap structure, funding, liquidity as well as hedging rates and FX with derivatives. Also, getting looped in time to time on special projects -- looking at capital allocation (dividends, buybacks, other options), helping FP&A build a better model to understand working capital changes and impact to FCF, working with tax to looks at ways to get trapped cash back to U.S., etc. Hours are fairly decent and this company pays pretty well for corporate finance standards. I'm itching to get back to a strategic finance role though -- more interesting, impactful work and just greater ability to rise -- feel like I'm getting stuck in corporate rat race and over due promotion has now been put on hold by HR due to COVID.

 

 

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