Middle Market ER Exit Opps

I'm curious to learn more about the exit opportunities that one could expect as a sell-side ER analyst/associate for a middle market firm (Jefferies/Truist/Blair/Cowen/Stifel/Piper). Specifically, I am wondering what quality of placements these firms get with hedge funds or asset managers.

So far, I've spoken with a few associates on the Street and I've been told that hedge funds care more about the individual's skills and knowledge of investing or analyst group rather than the name brand recognition of working for say, a bulge bracket. Moreover, they've said that because IB and PE tend to be more relationship driven careers, these fields value name brand more than most HF or AM, which care more about one's actual performance and returns at the end of the day.

That said, I'd be interested in hearing if there is truth in the belief that MM and BB ER have similar hedge fund exit opps all else equal; or would it be important to lateral from a MM to a BB for better looks from the buyside?

Thanks in advance!

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Comments (9)

May 5, 2021 - 11:15am

Buy side only cares whether you can think like an investor. Not a single person cares about whether your analyst is II rated, not a single person cares if your team has the coolest slides. 

Only possible benefit of moving from MM to BB is to at least have access to bigger hedge funds (like Tiger Cubs) as Stifel / Cowen are unlikely their top brokers (correct me if I am wrong on that). 

With that said, if you land at JPM / BofA and can't impress your top dawg clients that you wanna work for, pointless to lateral. 

At the end, it's all about you. 

Instagram: @dickthesellsider | Substack: dicktoad.substack.com

  • 2
May 6, 2021 - 2:15am

Depends what you cover at these banks. If you're covering biotech at Cowen for example, then you're fair game for a large HF seat given their dominance in that space. However, if you are covering something like industrials there then yes your chances dwindle when stacked against heavy-hitting bulge industrials teams. If you're in more niche equity research in general, you'll have better opportunities given your hopefully deep sector knowledge. That being said, if you're at a bulge in a not-so-great ER team, then you may be limited in your opportunities regardless. The prestige requirement from HFs in this regard is much less than say a PE firm looking to hire an investment banking analyst

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