Hi Everyone. There are a bunch of AMA threads on WSO, but my career trajectory is fairly unique, so I figured it may be helpful to some of you.
Background: I got an engineering degree & started as a Quant at a major buyside firm. Over time, I became more & more interested in finance (and less in programming), so I networked my way into Equity Research, and subsequently into Investment Banking, where I grew to the rank of a VP, with cumulative experience of 12+ years. Along the way, I worked at bulge brackets & boutiques, covered multiple sectors, worked in NYC/Chicago/SF, and was top-ranked among my class throughout my career. I have been on the hiring committee for Intern, Analyst, Associate & VP positions at various firms; and have mentored 100+ professionals & helped them secure jobs in Banking, Research, Sales & Trading, Hedge Funds & Strategic Finance / FP&A over the last 12 years - through resume & cover letter reviews, mock interviews, and career coaching. I joined one of the FANGs in Strategic Finance recently.
Please feel free to reach out if I can help with any career related questions.
Do you want to work with me? Check my profile here.
Hello!
I'm a Jr. FP&A Analyst at a SaaS startup and i would like to ask to you why you switched from IB to Strategic Finance? What are the pros and cons compared to the IB role?
Hi @caiovsts. Here's how I think about Investment Banking vs Strategic Finance.
Advantages of Investment Banking
Advantages of Strategic Finance
Personally, I had gained the breadth of experience that banking offered, and was looking to go deeper into understanding a business. Hence the switch to strategic finance! Hope that helps
Thank you very much for the answer!
How did you make the transition from ER to IB? Was it at the analyst level? I’m post-MBA at a large utility’s VC arm, and I’m hoping to make the switch to banking after a year.
Thanks for this!
Hi @MitchMitchell - I made the transition at the Senior Associate level. It was an uphill battle for sure & I had to overcome several biases, but I was able to network my way into a couple of bulge bracket offers.
Corporate VC to IB is going to be a tough transition, because banking is a very "structured" industry - they tend to be rigid in terms of the backgrounds they hire from, and the fact that demand exceeds supply in terms of aspiring bankers allows them to be super selective.
That said, I would recommend you try to switch asap - the industry is facing a severe shortage as several folks at the VP-and-below levels have been quitting, and deal flow is at pretty elevated levels. Happy to work with you if you want to schedule a 1x1 session!
Thank you for doing this!
Personally I have been looking to get into corporate strategy/strategic finance without the IB experience.
I was wondering what are some technical skills I should polish on and any other advice on breaking in.
1) How has the technical work changed after moving to SF? How has the financial modeling changed if it all?
2) Are your peers also mostly ex-IB? Any general advice on breaking in from an FLDP background or ways to check the qualifications to break in?
@TheStandingCoin -
1) The technical work in Strategic Finance is very different from IB. Essentially, as a junior banker, you are working on models and pitch books for multiple deals at the same time, so you are not able to develop an understanding of the company's business. When you're inside the company, you only focus on your employer's business instead of multiple clients. Also, you have access to internal company metrics, which you rarely get in banking, and you're incentivized to help grow the business over time and not just get a deal done. The combination of these things means that any analysis you do in Strategic Finance is a lot deeper than what you would do as a banker. You're still developing forecasts in excel, but you have a much better understanding of each line in the model and every assumption is vetted thoroughly based on real data. As an example, to forecast revenue, you would talk to R&D to understand the upcoming products, then talk to marketing to understand how they will promote these products, discuss with the geographic teams to understand trends in their specific geos, talk with different sales teams to understand what channels would be used to push each product etc. On the other hand, in banking you would simply growing revenue by 20% Y/Y because that sounds about right!
2) Strategic Finance tends to hire from a variety of backgrounds - there are folks who come from other parts of the company, from similar roles at competitors, some consultants, a few bankers etc. FLDP is a good background if you want to work in Strategic Finance longer term. As part of your interview prep, try and develop a good understanding of the industry the company operates in, the strengths & weaknesses of the company vs competitors, and be able to talk about a few things the company should change to grow revenue faster / cut costs. None of these need to be 'unique' ideas - nobody expects that if you're looking for a junior level. But if you read the news, a few relevant newsletters, follow a few thought leaders on LinkedIn or Twitter, you should be able to understand the big picture trends in the industry. If you can talk through them in an intelligent manner in your interviews, I think you have a good shot at breaking in. Good luck!
Thank you for the insight !
Is the comp as a manager at faang lower than an IB VP? If so, how much lower was it? Are we talking a 10-20% haircut on total comp, or more like 40-50%?
There isn't a definitive "Yes" or "No" answer to this, because it depends both on what bank/group you're coming from, and what company you're joining (and at what level). But if i HAD to answer it, then yes, you're probably going to take a 20-30% haircut to comp, assuming you were a VP at an "average" bank/group, and are joining an "average" tech company at a Manager level. If you're coming from a bulge bracket or an elite boutique, those tend to pay higher, so the haircut could be higher. And if you're joining a late-stage private company (i.e. one that has enough $$ to pay, but doesn't yet have a fully developed Finance/Strategy function), you could get a higher comp and thus have minimal haircut
assuming an average IB VP comp is 400k, would a strategic finance manager be pulling in 280-300 all in?
A lot more than 20-30% paycut. VPs even besides 2021 outperformance are making $500K+. Getting even $250-300K in strategic finance is questionable.
Hi,
Thanks for doing this. Will be great if you can provide some guidance here. I am a VP in Treasury at a BB looking to make a move to ER.
1) What level should I target? I am post MBA with several years of pre MBA experience so not sure whether I should come in at the most junior level. Have you seen VPs come into ER without any prior ER experience?
2) Should I pursue the CFA? Will it add any value from a recruiting perspective?
3) Should I try to network internally or recruit at other Banks as well? Any other tips will also be helpful.
Thank you.
1) It will be tough to get into ER from Treasury given there is very little overlap in skills, and there is also the question of justifying why you are looking to make a switch at a relatively advanced stage in your career. This is a very rare career transition, but I think it is still do-able. Your best bet is to target Associate level roles, and discuss with your future boss about an early promotion given your experience level. Your biggest challenge will be to convince them that you are genuinely interested in ER - to address this, you'll need to develop a good understanding on the industry you want to cover, read a few research reports, and preferably, write a couple of reports of your own that you can send to the hiring manager as proof of your interest & ability.
2) CFA will help, but it will take at least 3 years to clear all levels, and the payoff isn't proportionate. So overall, I wouldn't suggest it in your case
3) Given this isn't a common transition, you'll have to spread your network wide and target all kinds of banks. Your best bet is either at your current bank, or at smaller banks that are less particular wrt hiring. Also, you should identify what sector you want to cover in ER, find the analysts covering that sector in different banks, and then reach out to them on email / linkedin to see if they are hiring. And if you have alumni from your alma mater working in research, reach out to them and see if they are willing to give you a shot.
I think you can still pull this off, but your story (how do you convince the interviewer that you are genuinely interested in ER, and why are you making a transition relatively late in your career) and your technical interview will both have to be 8.5 or more on a scale of 1-10. Good luck!
Thanks for taking the time to answer these questions.
Is there a clear path of progression like there is in finance? As in, there’s typically a certain number of years at each title in IB before moving up, is it as linear in Strategic Finance?
How does the lifestyle compare to IB? Are the hours pretty regular/consistent week to week? Any spikes if you’re contemplating a M&A deal?
It sounds like there is pretty significant variation in terms of the comp/responsibilities based upon the firm you’re at. Any suggestions on how to learn more about a given firm (other than finding connections to talk to)?
Lastly, any advice for a MBA associate looking to switch over to the corporate side? Would you recommend getting a certain number of years/deals under your belt before jumping over?
Ditto to the last question. I've anecdotally heard best time to leave is VP years for somewhat senior corporate exits. Senior MDs are probably the only type of bankers who can possibly get a C-suite exits at CFO.
The level you join at depends entirely on what company you end up joining. If you go to a smaller company, you'll go at a higher level - simply because (1) if they are small & private, they will potentially look to IPO or get acquired, and they would want all the banking experience they can get in-house; and (2) they don't have a fully developed finance function yet. If you go to a MSFT/GOOG type company, they have folks who've been there 20+ years, so you're not going to go from a being a banking VP to any kind of a senior role in strategic finance. You'll probably end up as a Manager/Senior Manager, and if you can prove yourself, you could be on a fast track to getting promoted into the upper echelons pretty rapidly
Strategic Finance is a lot less "linear" than IB in that regard. It's not about spending a certain number of years at any given level, but more about showing the skills to increase your scope of responsibilities. In a way, it's more of a meritocracy than banking.
The hours & lifestyle are fairly consistent week to week. Things get busier during quarter end and financial planning season, where you're drawing up internal projections for the next 1-5 years. But even then, it's ~60 hrs per week at max. Nowhere close to banking levels.
Your best bet in terms of finding specifics about a company is talking to people who used to work there in a similar role. Those who are current employees may not want to be, or may not be allowed to be, completely honest with you. If someone has moved onto another job, they are less likely to have any reservations giving you honest insights into the work culture, comp etc.
As I mentioned in a previous response, Strategic Finance hires from all kinds of backgrounds. If you're looking to get into corp dev, having more deals will help improve your credentials in the eyes of the interviewer. But for Strategic Finance, it's more about whether you understand the industry and the company's business model, as opposed to having done 100 deals in an unrelated sector.
Hope that helps!
Thank you for doing this!
I am currently looking to move into strategic finance as an associate, but have found myself being very picky in terms of sector. How much do you believe that matters when it comes to finding the right role? I am huge on fulfillment in my career, and finding a great company/culture within an industry I'm interested in is obviously the goal, but think I need to be less picky if I want to find a role at all. Thanks!
Agree with you 100% on job satisfaction, although being very picky does restrict your options. I think you need to be pragmatic and look at what background you're coming from, and how easy/difficult it is to get into Strategic Finance from your current role. If you're a tech banker looking to get into Strategic Finance, you should have no difficulty getting into any tech company (assuming your interviews go well), but to go from tech banking to Strategic Finance at a biotech company (as an example) is going to be an uphill battle
Del
Currently work in PB/PWM at a BB, but have 2+ YOE in corporate finance (public tech company) prior to this role. I got some traction initially and have been able to spin my story well, so just gotta see what can happen. Thanks for the reply!
Thanks for posting this - super helpful!
I'm currently an 1st year associate at an UMM PE firm. Fairly unhappy with my current role as it feels like Banking 2.0 after coming out of a sweaty BB. I've been rated highly at both my first and current firms, but frankly have no interest in staying past my 1st year at my PE firm.
I'm currently contemplating either joining an LMM PE shop or maybe something more on the Growth / VC side that would offer better hours and lifestyle or a strategic finance / biz ops role where I learn more about building at a company. I'd say my long-term values are good WLB (not a fan of the ebbs and flows in deal-based work), autonomy in my hours (getting sick of being on call all the time), feeling fulfillment / value in my work but still having some equity upside (previously motivated by comp / prestige only but realizing that isn't my long-term path to happiness).
I'd be curious to know if you ever considered a less intense buyside role before your strategic finance role or if you have any other thoughts to help me navigate my decision? I'll likely be looking for a new role in early Q3.
I think the buyside vs Corporate decision depends entirely on what you want to do in life longer term, and how you think about job satisfaction vs compensation. The buyside role will help you become a better investor, without teaching you much about how a business works. Strategic Finance will help you understand how different departments in a company come together to grow the business, but will not help you grow as an investor. So it comes down to what your long term career goal is
Thanks for the reply!
I don't think I see myself as an investor long term, which is one of the reasons I'm contemplating leaving in the near(ish) term. Have seen the lifestyle of seniors at my firm and frankly that just doesn't interest me.
Hi,
In your opinion, which corporate functions (if any) would you say Corporate Banking experience (coverage team/loan origination & execution) would be most transferable to?
I don't have much experience with corporate banking, but in my view, it would probably be some part of the treasury function in a corporate.
Don't mean this in a negative way, but were you looking for Director / VP level positions at corporate and decided to take a lesser role (manager) to go to dream company / exit? I'm in a similar position, IB VP with 8 years of experience, and most of my colleagues who have exited at this level went into Senior Director, VP, EXP level roles (Not F50 companies). Just curious how you navigated new roles based on your experience.
Veritatis porro eaque quo molestiae molestias dolorum culpa. Quia pariatur quibusdam voluptates tenetur corporis. Et voluptatem ut libero voluptas excepturi. Dolorum ut provident odit earum et.
Corrupti voluptatem atque voluptates sunt. Iste iste est ut modi neque. Commodi commodi fugiat doloribus veniam nostrum tenetur necessitatibus accusantium.
Vitae possimus neque nesciunt. Et eius ea ducimus atque reiciendis veritatis. Aliquam possimus eum inventore. Sed laboriosam est expedita magnam. Ea tenetur quaerat quos quis tenetur qui fugit quia. Praesentium hic voluptatem vero voluptatum id iusto ut.
Voluptatum non provident id. Voluptas modi rerum reiciendis rerum est est. Veniam veritatis nulla recusandae reiciendis.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...
Aut dolores saepe a consequatur ut sit. Sit perspiciatis voluptatibus quo.
Placeat sint voluptates eos accusantium ducimus at. Ut quia voluptates ea doloribus unde molestias. Dolor debitis delectus nesciunt in. Quia dolores modi consequatur. Fuga doloremque quibusdam omnis fugit omnis. Quis sit tempore asperiores cum tempora nihil.
Tempore saepe qui mollitia. Omnis quasi repudiandae qui qui officia incidunt omnis. Excepturi ratione laboriosam sint laudantium iure voluptas. Impedit molestiae corrupti aliquam consequuntur expedita sint quia omnis. Sunt rerum assumenda omnis a dicta quaerat. Laboriosam ad dolorem in et pariatur a omnis sapiente.