For a later career in Private Equity, if given the choice between Financial Institutions investment banking or real estate investment banking (as a first year analyst), which would you choose?
Also, does that choice differ if you want to go into VC instead of PE?
Thanks
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Real Estate every time.
covering RE has zero relevance to VC - that I can assure you.
but neither does FIG banking, correct?
RE pigeonholes you, it's hard to move from REIB --> corporate PE. Generally a REIB analyst will move to a real estate-focused fund (Blackstone RE, Colony, Westbrook, etc.) after their stint is up.
For general PE I'd probably go with FIG
RE analysts frequently leave after just one year. Most RE funds that I've seen hire for immediate start on an as needed basis so you could be starting your PE stint quicker than most if you go that route. As others mentioned, it about as niche as you can get so it's difficult to move to other disciplines.
if its goldman - you know..
I was a real estate analyst who moved to REPE from a BB and had a number of friends in FIG. I think the RE route has a higher chance of turning into PE than FIG, but it is almost 100% certain to be RE PE and not generalist PE or VC. As someone before me mentioned, RE is more likely to hire on an immediate / as-needed basis, so you have a good chance of getting out early (but hiring comes in lumpy waves, rather than the consistent annual class hiring of generalist PE).
I think FIG has slightly lower placement (obviously depends on the bank you're at), but there is some flexibility. The guys in FIG who cover financial technology / exchanges / asset managers have pretty good exits to a variety of PE firms, and get recruited to VC firms from time to time. If you're covering banks or insurance, your exit opportunities will be more limited to the financial services space.
If you're generally indifferent between the industries, I suggest you figure out which group is stronger within your bank. Early M&A deal experience is what counts. Regardless of industry, you will not find yourself going anywhere if you are not closing live transactions.
As a parting word of advice, do not confuse breadth of exit opportunities with probability of a good exit--both count. For instance, as I mentioned earlier, I would say FIG has broader exit opportunities, but RE offers higher probability of a good exit. Breadth is always a tradeoff with specificity; you may get to compete for more opportunities, but you will often be competing with an even broader pool of applicants. The most plum generalist PE jobs will likely go to the M&A and sponsors bankers at the top handful of BB banks and elite boutiques, and then the top analysts at a few highly-respected industry groups on the street. If you're not in one of those groups, breadth is more likely to be an enemy than a friend.
+1... definitely agree with you about the breadth vs. specificity tradeoff, it's something that is rarely voiced but people often overlook.
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