Currently an associate at a LMM fund and have been thinking about making a move to Corp Dev. It is tough to imagine building a career in private equity over the next 10-20 years with so many new funds pushing up valuations and pushing down returns.
Anyone that has made the move have you had any regrets or things you wish you would have known before making the move?
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I actually have considered and sought making the move from Corp Dev. to PE in the past. At this point in my career, such a move would be possible for me to make, but not sensible given my career trajectory.
I would say that it is easier going from PE to Corp compared to the other way around. The only thing is that recruiting is a bit sporadic and if you are beholden to a certain city or region of the country, then it can make the process more arduous (ignoring industry for the moment). I would refer you to the M&I articles on Corp Dev. recruiting and WSO AMAs from Corp Dev professionals to gain more insight into the role.
can you elaborate on why you are confident on your move from Corp dev to PE as being possible at this stage? and also why it wouldn’t make sense to do so?
I have interviewed for a few different PE roles in the past and got pretty far in those processes. I am more confident about making the move now given that my current role is an expansion from my prior role in Corp Dev where I essentially run a few different processes for multi-million transactions. There is a quite good amount of overlap with the work I do comparable to a PE professional (reviewing CIMs and other information from a potential seller, putting together a model and investment memo, presenting that materials to Senior Committee and proceeding to next stage of deal entailing a more through Due Diligence Process working with different third party advisors among other responsibilities towards transaction close).
The reason it would not make sense for me at this stage is that I am pretty far along in the Corp Dev career path to where my next role will essentially be leading a team of other Corp Dev professionals (or could be something else entirely different to be fair in this current environment).
That is not to say the door is completely shut on making such a move, but it seems very remote at this point to be frank.
I'm assuming with the traditional IB path out of undergrad, one can probably make it to VP in Corp Dev by around 30. After that, do most normally just stay in Corp Dev for the next 30 years or do most exit to executive/general management positions either internally or externally?
VP in Corp Dev by 30 is not impossible, but Manager or Senior Manager is more likely for someone in Corp Dev at that age given a normal trajectory.
Corp Dev exit ops run array of different options: - Operational Finance - Corp Dev at another company in similar role or higher role - IB - PE (have not seen too many exits here, but it happens)
Did those who transitioned to PE have prior banking experience?
I think its very rare to see someone who has just CD experience transition to PE (investing side, I could see a CD person moving more easier to the operational side).
I am currently in CorpDev but did not come from PE. However some things I wish I knew beforehand:
Cons: - Not much upward mobility - at least not as quickly as in finance - Teams run lean, so it's hard to target specific companies to lateral to simply because of numbers and you'll have to wait for an opening - It's a different kind of politics you have to deal with in CD when others throughout the business all have non-business backgrounds, motives, technical expertise, and disposition towards M&A. Had a previous role where people on the frontlines of the business didn't support M&A and actively tried to shut deals down because they thought it hurt their job security. Whereas in PE you need to make deals and everyone is on board with that - Lack of a portfolio management function post-integration (maybe)
Pros: - CorpDev at acquisitive companies definitely have better job security than most people in the actual business of the company - Good lifestyle if your team is cool. ~50-60 hours - High visibility since you report to C-Suite, so you feel important and respected - You look closely at qualitative aspects of deals and synergies, so it feels like finding the right puzzle pieces which is rewarding
Disclosure: Have worked at 2 different corpdev roles and trying to move to PE eventually
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