Is IBD/PE salesy enough?

Hi there,

I've been reading the site for a year now, with ups and downs and finally got around to my first post.
It has come from a personal problem, as most of the posts on WSO. I'm having trouble deciding which career I should move into. Currently, I'm in an Eastern Europe country, moving to London this summer. ATM working in BIG4 audit, my first year. During college, I was working in sales and I'm feeling I would like to be more client faced than I am at my current job. I've been interested in IBD and maybe moving to PE afterwards, but at the same time I would like to start interacting with clients as fast as I can.

So all in all, I was wondering, is it worth the wait in IBD? Whose the better salesman in the end: the guy who's in PWM and brings in solid no of clients over a period of time years or the IBD MD who gets an international multi-billion deal done?

Any insight would be much appreciated :)

 
thecoldburns:
I can't really speak at the MD level but investment banking has much bigger sales aspect than private equity, unless you're with the investor relation/fundraising team. Much time in private equity is spent on portfolio monitoring rather than making sales.

yea i agree and plus it feels a bit more exciting as well

 
cheese86:
^^I'm not sure how to read your disclaimer so maybe we are saying the same thing but at the Partner/MD level in PE it can be incredibly salesy. At many shops, probably more Middle Market the senior investment team is on the road fundraising for 12-18 months at a stretch every few years to raise money for a new fund.

I do agree. One of my investment team's Principal spends half his time with fundraising activities.

That being said, we're fortunate to have an investor relations team that focus purely on fundraising efforts. Also, perhaps because of our geographic situation, we rarely do much deal sourcing so majority of the time is spent on investment activities. My point of view was more from an analyst to sr associate level since the OP will be moving into this level in private equity.

 
jaan1:
Thanks for the responses You mentioned Investor Relations teams in Private Equity. I know the topic has come up in the forums before but I haven't found if the investor relations guys in PE can get a similar amount of comp as the number crunchers?

Rather than focusing on carry as the upside like the those in investments, the upside from Investor Relations are usually generated from AUM raised. I'm not sure how is it like for Europe, but from where I am, the fundraising team can get up to 3% for the amount they raise. In many ways, the Investor Relations team act as the PWM/Private Banking team for our UHNW investors.

I can't speak much for PWM but I know someone who left Goldman Sachs' private bank and started a family office managing >600m from the get-go.

 

if you're a good salesman and financially savvy I would suggest going into S&T sales. any other role within an investment bank at the lower levels will have close to none client interaction(besides PWM). I am currently on a big 4 internship and I understand your disappointment with client interaction, but being in IB as an analyst will require little client interaction. However my friend works in sales and really enjoys selling to clients. PWM can become incredibly lucrative if you are able to build a solid client base

 
Best Response

Honestly, I know PWM guys making far more than investment bankers with a large amount of residual income. They could literally stop working right now and make six figures a year for at least the next decade. IBD pays well but it's not the only way to skin a cat.

The upside with IBD is that there's a large base salary. If you can live without that and are an awesome salesman, PWM could be for you. However, if you're an auditor and merely want a little more time talking to people instead of staring at spreadsheets, I'd think long and hard about who you really are.

Perhaps contact a brokerage like AXA and do it part time. I know a guy who was an accountant and whose clients wanted some investment advice so this is what he did. After a while, he was making far more offering advisory services and left accounting to become a broker. Perhaps think in those terms. Unless you really KNOW you're a sales guy, don't assume that you are. And if you are....what you waiting for man? These dudes can make a killing?

Get busy living
 

Thanks guys. Everyone's really helpful :)

To UFOinsider: Its hard to know for sure what a person IS and what I would be best at in the end. But so far, in my BIG4 gig, a number of managers have asked me if I've been a salesman before and all the positive feedback has mainly been about the way I communicate with clients/team members etc. Negative feedback has been more about my lack of detail and poor knowledge of accounting (sometimes), therefore, I have thought that maybe Investment Banking (IBD) is not for me and I need to find a way to bring myself in front of a client and sell. Mentioning PWM - is the best way to go there straight or should I start somewhere else? And also, going to London in 3 months, and just starting to look for a gig there, how related are the stockbroker jobs (paying £20k+uncapped commission) with PWM? I believe those are retail brokerages of some sort so if I create a number of clients from there can I take them along to PWM (if they qualify of course)

And what am I waiting for? Its busy season here in audit atm, so I would let my team down if I suddenly quit. I'll finish the season (until June) and then take my leave.

Thanks again, you've been great guys

 
packmate:
jaan1:
bump, sorry, just a little anxious. Finally getting some break through on the whole "thinking what to do with my career" thing. And downtime at work as well :)
Haha busy season is killing me to bro

lol yea same here

 

Private equity and IBD become predominately sales jobs at the senior levels. I would say 80 - 90% of your job focus at these levels is "sales." Typical activities include:

Private equity partner - of course you have the fundraising efforts, which is basically a year long marathon of endless sales meetings with potential investors, but you are also in a sales role once the fund is closed. You will spend a lot of time flying around the country shaking hands with CEOs and trying to convince them to sell you their companies, then you will have regular meetings with investment bankers, commercial bankers, and other third parties where you will convince them to lend you money, get you "proprietary looks" at deals, etc. Then you will have regular updates and meetings with LPs, which are basically follow-up sales visits. You are actually doing very little analysis at this stage (you should have several layers below you doing that), and the vast majority of your day will be spent on the phone or in meetings, selling your fund in some way to someone.

IBD MD - the purpose of your existence is to bring in deals. Thus, most of your time is spent flying around the country trying to convince companies to do a deal with your bank. Yes, you have to have a little analysis done to pitch the companies, but again, most of that will be done by someone else.

 

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