Have ER Offer; Can't decide if I should take it
Ok fellas, I have a dilemma. Short of it is I've been offered a senior associate gig at a very well reputed research shop here in town, and I can't decide if I should take it. Part of this is just talking myself through it I guess, but hoping other people might have some outside, unbiased advice.
Now more detail:
- I'm 30, and have worked for one company my entire adult life. Total 7 years with them now, 2 before university 5 since.
- A few months back I was promoted to Manager of Investor Relations.
- A few weeks ago I got randomly called by the analyst hiring, asking to get coffee. I'd applied I think 3 years ago, he held onto my information. Now I have an offer letter in my hands.
- Base salary is approximately 60% of what I make now (problem with having been bumped to middle management). But he assures me, with the annual bonus, I'll probably be roughly even with the corporate salary and bonus in my first year, and just goes up from there.
So, pro's of making the switch:
- I have experience with one management team. Research exposes me to dozens.
- I'm in a dying sector:
- - - ER exit opportunities are (I'm assuming) pretty dang good. A sell side research gig would open the door to staying on the financial services side.
- - - My current company will exist in 10 and probably 20 years, but I have 35 years until retirement. I can't say I expect our sector to be around for that long, or to be making any money at all by that time.
- - - I'm on track to an officer role here, eventually I could be CFO if I don't totally mess anything up. But like I said - it's a slowly dying sector. Who wants to be CFO of a sinking ship.
- - - 99% of the guys in my line of work will switch to our competitors, but very few actually make it out of the sector. And the longer I wait, the harder it'll get.
- Long term financial rewards of the ER side are probably better than what I'll get staying on industry side.
- HUGE learning opportunity. My recent promotion means I have sure 2 years of learning ahead of me on the current path, while figuring things out. But research grows that exponentially.
- My sector has a pretty big center in London too. Getting SS experience could give me an opportunity to eventually transfer there (I love London).
- The guys seem like a really good fit, and the analyst insists that he can get out at 3 on Fridays not inconsistently.
And cons:
- 6 AM meetings. Every day.
- Annual gross comp comparable, but giving up a very comfortable salary to get there.
- Have to pay for my own cell phone (I know right??), CFA dues too. Actually, I have to pay for pretty much everything. It's a partner owned firm so they're very, very frugal on what they cover.
- Walking away from a known variable in my life - I love my current coworkers and bosses and culture. But it's worth mentioning this new place has been described as the old boys club - everybody wants in, and they really emphasized fit in my interviews. So there's no indication that I won't have that at the new place.
- 6AM meeting. Every day.
- Reporting season hours. Worth mentioning that the farther down the management path I go at my corporate gig, the worse the hours get here too. But at least I don't have to be in for 6AM every day.
- Probably have to move out on my roommate. He's noisy and I won't be able to sleep enough to get up for the 6 AM meeting, every day.
- I'm single and actively dating. A good date usually ends at 1AM after a bottle of wine, then I just slog it through the corporate grind the next day. Even a shitty date doesn't start until 9. Something tells me this isn't going to work in ER.
- Did I mention I'll have to be in office for a 6 AM meeting, every day?
- Because the firm works as a partnership (or whatever you call it), compensation becomes almost or entirely variable by the time you hit analyst. Company not making money, you're not making money. They do give the associates a guaranteed salary though (he didn't actually say if they take that away when you partner up).
- My current employer has treated me very well. Like way better than I ever felt like I deserved. I hate to walk away from that.
- I was just promoted in February. I hate to bail on the company so soon after they gave me that vote of confidence.
So yeah. 3 years ago I was very actively pursuing research (thats how he had my info). 2 years ago I would have accepted the offer on the spot. 6 months ago, prior to this promotion, I probably would have but was starting to get comfortable after some raises/etc. Today, I honestly have no idea what I should do. If I stay at my industry gig I can be grossing $200K in the next 5-7 years probably, if not sooner, which is no small chunk of change no matter who you are.
So in summary - money isn't a huge factor in the decision. It comes down to I want the experience and exit, and of the research firms in my city, this one always was my top pick. But I really don't like the idea of 6AM meetings.
Gonna sound like a dick for a second
6 AM meetings. Every day. 6AM meeting. Every day. But at least I don't have to be in for 6AM every day. 6 AM meeting, every day? But I really don't like the idea of 6AM meetings.
Put your helmet on, get your ass back on the field. Welcome to the NFL.
From what I'm reading of your cons, it seems like they're mostly related to sleep and the fear of unfamiliarity. Because you pose some really promising pro's. Seems like a no-brainer to me. But I'm in consulting, what do I know
Unfortunately, the sell-side equity research space is a shrinking industry. Headcount, compensation, etc. has declined steadily since the financial crisis. It's quite possible compensation will continue to decline in the future. On the flip side, it can be an interesting industry where you learn about different industries/companies/markets. Also, you will have different job opportunities coming out of ER vs. your current role. However, based on your current job / promotion, the worse hours in ER, and the worse starting salary in ER, I would recommend that you not take this job offer.
IMO from your post i would stay in current position and not take the offer.
I'll weigh in here on a few different aspects and give you some insight from someone who's currently in SS research.
First off, to echo the above, 6AM isn't that bad, honestly it could be way worse. You could be doing research on the west coast and be there at 4. Besides, you adjust after a little while. If research is something that provides you a path to your preferred career goals or is the preferred career goal then just do it.
What sector are you currently in and what would you be covering if you took this position? This will shape to some extent your options for the next career move. Some people don't think it's good to "pigeonhole" yourself with a very niche sector, others making a killing being experts in one sector. I bring this up because you mention you don't expect your current sector to be around in nearly 4 decades and I imagine you will be covering the sector in which you currently work. Your options after research are decently broad and the bulk of the analytical skills and financial knowledge are transferable, not to mention I don't know many people who have stuck around the sell-side or even the buy-side for 35 years. Most guys crush it then leave in my experience.
If comp is a concern, I wouldn't fret too much on this aspect. You can be clearing $200k on the sell-side before you will in your current seat, even if the industry is facing some structural changes on the horizon. It is interesting though that you would be taking such a steep cut. Entry level base is generally $85k and that's fresh out of undergrad. CFA and that much industry experience I would've guessed your base would at least be equal and total comp higher than your current? Either way, a small short term sacrifice especially if this firm is as reputable as you say, the next jump should see you in a much more comfortable position.
Lastly, the declining capacity in the industry of sell-side research will only be a major concern to you if this new firm is operating in the past and provides little, to no value added beyond the litany of other "research" platforms. Those who will be hit hardest are those who are grossly overpaid for regurgitating press releases, among other things.
Hope this helps.
What are your long term career goals? These positions will likely land you in two very different places in 10 years, so I'd place the most weight on which career path you want to follow over the longer term.
Thanks all for the input, it's kind of reinforcing what my gut was saying all along.
The 6AM mornings is a self discipline thing so shouldn't be a factor. The compensation is a non-issue, and it shouldn't be long before I come out ahead anyway. End of the day, my current career path is taking me further and further down a road I didn't really want to be on to begin with, and there's less off ramps after every promotion.
Street Smart nailed it I think. One of my bigger fears is that people say ER is a shrinking industry, but this doesn't happen overnight. I can get enough experience in 5 years that all sorts of financial services doors should be open to me even if I do get laid off at that time.
As far was what sector I'm in, I'm trying to stay vague since it's a pretty small sector. But let's just say we're heavily located in the mountain time zone and middle east, and the entire liberal world wants us gone.
I would stick with my current role if I were in your shoes. It seems to me as though you are attempting to digress in a sense. Many individuals in ER have the end goal of becoming the CFO of a company in the industry they cover, and you are already well on your way to becoming that. Your argument that your company may not be around in the next 40 years sounds to me like an opportunity for you to start shifting the company in a direction so that this will not occur. A sinking ship is not seen 40 years out, and if it is, it is the duty of the captain and its crew to change its direction and avoid the iceberg.
Sounds like you have an offer from a smaller shop. The industry is going to get toren a new one when MiFiD II roles through town next year. Think smaller departments and lower pay. Then think about the secular trends like funds flow to passive from active. It's like close to 40% passive out there so Buyside is under a lot pressure. No Buyside then no need for sellside. Finally consider the role automation can play in the next 5 years. A lot could be done with machine learning to wreck equity Research.
Finally, exit ops are really going to depend on the sector. Software internet or growth industries like that can have some good exit ops. Others not so much. Had a friend in a bad sector that had to look for a job for almost a year after getting the Axe. Move to equity Research if you really like the equity markets and enjoy working your ass off with very little work life balance. Can be a rewarding career but some tough years ahead.
If you like your current company/industry I would stay exactly where you are. ER is still better than average work but its not what it was 10 years ago in terms of opportunities and comp. It sounds like you are in a good situation and reality is, lots of ER associates are looking for opportunities like the one your in. As you climb in investor relations you should be able to get a healthy dose of equity markets exposure to scratch any itch you may have.
Also, I did years of ER on the West Coast with 4:40am morning meetings. Your body will adjust to those 6am meetings. Should be the last thing you worry about.
As a current sell-sider I can tell you most of my peers are looking to do the opposite of what you're considering. As it's been mentioned, life on the sell-side has gotten a lot less fun because life on the buy-side has gotten a lot less fun. More work for less pay is probably not a trend that's going away anytime soon. Maybe the grass is always greener but I would personally love the stability and upward mobility potentially offered by a corporate gig.
I would stay in your current role given the pathway to the C suite (CFO's of dying company's just become CFO's somewhere else) and the significant difference in comp.
Like someone said above, it sounds like you got an offer from a much smaller shop, unless you are currently making ~$300k (in which case, it would take a VP research title to clear that much).
I'd only consider a move to the sell side if it were from a top tier shop (GS, MS, JP, etc - name brand somewhat matters in financial services) or top team (II ranked - matters more) and if all in comp was better than your current role. You should also probably have at least some interest in stocks, market, etc.
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