Move into Private equity

tk-max's picture
Rank: Chimp | 15

Hi there,

Im based in London and am deciding between two options there.
I have a job offer to join a big 4 accountancy firm in their audit division to take the ACA accounting qualification.
I also have another offer from a (really quite) small M&A advisory company. i.e. only 100 professional staff globally.

My eventual plan is to move into private equity, and I was wondering which would set me up best for entrance into PE?

The accountancy work is dull and has a smaller salary, so I'd only choose that one if would set me up for a move into PE better than spending the same amount of time (3 years) at the small advisory company.

I would, however, be able to do several month long secondments into the advisory side of the accounting firm. I know a partner in the private equity group and an MD in the Transaction and restructuring division, who would let me move into their department for up to 6 months. Does this change anything?

Thanks for any help

Comments (21)

Apr 22, 2010

Unless you strive to work in back office PE, go with the M&A firm.

Apr 22, 2010

No question, take the M&A offer. Private equity firms generally look for people with investment banking or consulting backgrounds (assuming the route of a 2-year program in one of these fields right after undergrad). With an accounting background, you'd have to really know some people in the industry to even get your foot in the door, and even then, I bet that gets you a PE interview at best.

Apr 27, 2010
Pat_Bateman:

No question, take the M&A offer. Private equity firms generally look for people with investment banking or consulting backgrounds (assuming the route of a 2-year program in one of these fields right after undergrad). With an accounting background, you'd have to really know some people in the industry to even get your foot in the door, and even then, I bet that gets you a PE interview at best.

Exactly right. Plus you mentioned that the accounting role would be dull, which is most likely true, but also implies you wouldn't be the least bit excited about going to work everyday. If you read through various posts in the forum you will see many people talking about PE hiring retracting and becoming more competitive and difficult, which only solidifies how important Bateman's point of making contacts and getting your foot in the door will be. Good luck.

Regards

Apr 22, 2010

Unless you're in Canada (where someone with a CA designation, and also some corp fin or transactions experience can potentially get into PE), then you don't have to think twice about taking the M&A shop.

Apr 23, 2010

I'm sorry but all this "M&A is always better than consulting or accounting" nonsense is so far off-base it is untrue.

I would take the Big 4 offer for the following reasons:

1) PwC/KPMG etc are big, well recognised names - you will not be perceived as second rate, you just decided not to pursue a career in banking immediately following uni. On the other hand joining a relatively unknown M&A house DOES look second rate - it appears to show you would have taken Lazard or Barcap if you could but didn't get an offer

2) Accounting is the basis of ALL financial professions - everyone working in PE will have had to learn accounting to an extent and this knowledge will be useful

3) The ACA is a fantastic qualification to have and at least as relevant as a CFA to PE

4) I'm assuming by PE group you mean Transaction Services for PE clients - this is one of the best opportunities you could possibly have to learn how PE deals work and gain exposure to PE professionals whilst in a grad program

5) Have a look at the CVs of MDs and Partners at the top European buyout houses - you'll see a surprising number qualified as accountants

The downside is by all accounts being an accountant is pretty boring and you'll almost certainly get paid less. If I were you I'd get the ACA and move on or join TS.

Apr 23, 2010
Djalminha:

I'm sorry but all this "M&A is always better than consulting or accounting" nonsense is so far off-base it is untrue.

I would take the Big 4 offer for the following reasons:

1) PwC/KPMG etc are big, well recognised names - you will not be perceived as second rate, you just decided not to pursue a career in banking immediately following uni. On the other hand joining a relatively unknown M&A house DOES look second rate - it appears to show you would have taken Lazard or Barcap if you could but didn't get an offer

2) Accounting is the basis of ALL financial professions - everyone working in PE will have had to learn accounting to an extent and this knowledge will be useful

3) The ACA is a fantastic qualification to have and at least as relevant as a CFA to PE

4) I'm assuming by PE group you mean Transaction Services for PE clients - this is one of the best opportunities you could possibly have to learn how PE deals work and gain exposure to PE professionals whilst in a grad program

5) Have a look at the CVs of MDs and Partners at the top European buyout houses - you'll see a surprising number qualified as accountants

The downside is by all accounts being an accountant is pretty boring and you'll almost certainly get paid less. If I were you I'd get the ACA and move on or join TS.

Did your senior give you permission to take a break from reconciling Tyco's PP&E? Get back to work!

Apr 23, 2010

[quote=Car RamrodDid your senior give you permission to take a break from reconciling Tyco's PP&E? Get back to work![/quote]

Good point well made.

Several of the guys at the PE house I worked at have Big 4 accounting or TS backgrounds. None came from boutiques.

Apr 23, 2010

The OP mentioned that this is for London, which is very much different from the US as far as PE recruiting is concerned.

Djalminha is right, a lot of the guys in PE firms in London come from the BIG4. In fact even BB banks are currently recruiting ACAs in London for IBD.

However, I think you would have much more fun working in M&A advisory (accountants tend to be boring people in my opinion).

It is not a no-brainer. I would say this really depends on the M&A firm.

If you let us know the name of the M&A firm we can give you a serious answer, otherwise its difficult. (you can PM me with the name of the boutique if you don't feel comfortable posting it here)

Apr 23, 2010

The bank is pretty similar to the one's listed above, if that helps...

Apr 23, 2010

Hi i work GSPEG London, that Goldman Sachs PE, I'm at associate level now and faced a similar dilemma to you. I had offers from PWC for audit, Greenhill, and Morgan Stanley M&A. I didn't want to work at a big bank for the usual reasons. PWC was my back up, but the more i got to know about them the more i thought a relaxed first couple of years would be nice.

What boutique is it? if its hawkpoint, evercore or moeblis, i would reject the offer. Alot, and i mean ALOT of my superiors were in accountancy, then moved into industry or M&A. Starting in M&A in Europe is not the big deal it is in america. basically it comes down to whether you back yourself come 3 years time and you're going up against people who have done M&A at Goldman. Often these guys are idiots, and can't cut PE, which becomes more about innovative thinking than model crunching. Working at a small bank shows you couldn't cut it at a big one. There are loads of posh idiots, who think that getting into M&A guarantees them sweet PE possibilties. Wrong. They look at deal transaction, if you ain't been on the great deals, its not going to help that your daddy knows someone, and you went to a good school

Audit is boring, but as i found out, my best friend from oxford went to Deloitte, they're the ones going out having fun, getting the pussy and hitting up the clubs, because they have the time. Do want that or excel. I chose excel but it wasn't fun, alot of my fellow analysts didn't get jobs in PE. To be honest i was the best.

From your post it strikes me that you wouldn't cut it, I mean i got morgan, from the way you're talking about your offer it sounds like you're not sure. Grow some balls and see what you're really like, back yourself. If you want the best PE opportunities go to Mckinsey or Bain.

hope you make the right decision.

Apr 23, 2010

do you think you would like m&a or would it just be a stepping stone for PE?
I hear hawkpoint is a nice place to work at.

Apr 23, 2010

A friend of mine just accepted a job at Hawkpoint.....He thinks it will be good but he says that you don't get paid nearly as much as other places, especially over a couple of years. : (

Apr 24, 2010

i think PE firms are really only looking for big deal experience - do you think you would get that at your bank? that's certainly been my problem and i'm at a slightly larger one than those above.

Apr 24, 2010

maybe not, but i dont think i would get it in the advisory division of the accountancy firm either.

Apr 25, 2010

true, probably take M&A over accountancy and try and make it onto the big deals. hopefully you're not at a bank like evercore or hawkpoint, their deal flow is really small stuff. good luck

Apr 25, 2010

I agree with Djalminha and European Bob on this. If your intuition doesn't tell you straight away which one to take you have to look purely at the practical side of things, and which one will put you in a better position in the long term: Take the accounting, get the ACA, less money for a bit but then you have the qualification. Then high-tail to a good IBD for a bit and get the deal experience.

That means you hit PE with top brass experience in both sectors and will move up quickly once your there. This M&A job doesn't sound too promising (some of the ones mentioned are nice places to work sure but don't necessarily make recruiters jump) and you have to think long term about this.

Pat Bateman above is a prime example of the myopic decision-making that plagues US IB right now....watch out for that sort of advice.

Apr 26, 2010

I went for what i wanted to do. the advisory job and am pretty happy with the decision.
Accounting is dull, fact. Everyone admits it is. I know advisory is bad too, but its not as bad.
A lot of people are finding it hard to move from the big four into IB, the worst case scenario would be me having to stay beyond my ACA period. Obviously I took the decision to avoid this. If i had to stay on/wait a few years at one it would be the bank.

Thanks for everyone's help.

Apr 26, 2010

you are a massive fag. stop thanking us and go make some fucking money.

Apr 26, 2010

Its your life - and your mistakes.

Apr 26, 2010
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Apr 27, 2010