Q&A: Tech Corp Dev Analyst -> Growth Equity Associate in China

Hi monkeys! Got bored in off-peak season, thinking Q&A might be fun. My background: - Born and raised in China - Non target undergrad but with MBB/top VC internships in college - 1st job was Corp Dev analyst at a large cap TMT company in China, worked on M&A/strategy/fundraising - 2 yrs later moved to China growth equity team of a global brand (think TPG/KKR/Sequoia/SoftBank), now a 2nd yr associate - Have worked with BB IBD teams for sourcing/fundraising/portfolio mgmt etc. - At my current role I manage MBB/boutique consulting firms for CDD and big 4 for FDD I could talk about the tech/VC/PE/banking/consulting space in China. Pls ask away!

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Comments (8)

 
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Jan 24, 2020 - 9:00am

Thanks so much for doing this--it seems like you have an awesome background!

Have you spent any time living outside of China (e.g., US or Europe for school/work) and did you only consider positions in China?

How did you make the jump from corp dev to PE? Seems like a hard jump in the US but is that more common in China? Did you go in knowing that was the intended long-term path?

As someone who studied Chinese for many years but has never lived in China despite a lot of interest on my part, I'm curious: how hard would it be for me to make the jump to China within PE/VC/IB? Would it be far more likely at a multinational firm to move NYC->China or are some local firms open to foreigners?

  • 2
 
Jan 25, 2020 - 6:48am

wabo22:

Thanks so much for doing this--it seems like you have an awesome background!

Have you spent any time living outside of China (e.g., US or Europe for school/work) and did you only consider positions in China?

I've spent a semester in Europe during under grad as an exchange student (a decent program but not top school, just for fun) and travel around 20+ countries, mostly for leisure but also for business like roadshows or company retreats. Never based in an overseas location though.
I think for now China is still one of the best investment opportunity, esp for growth investors (300m to 800m rising middle class in 10 yrs, penetration of smartphone and 4G/5G, acceptance to new tech). So it's still my preferred location, though I would love to explore interesting experiences overseas

How did you make the jump from corp dev to PE? Seems like a hard jump in the US but is that more common in China? Did you go in knowing that was the intended long-term path?

Networking and deal experience.
In China Corp Dev at big tech could offer better deal exposure than growth PE. So I played that card during interviews. In fact at my current team I even had more experiences on bigger deals than my VP/partner (though I was not driving the deal but rather doing grunt work).

The jump is harder for people like me (no prior banking experience before Corp Dev, from local tech to global fund), but common for candidates with prior banking experience or positions at local PE funds. Although this only applies to growth PE not the traditional buyout funds, as Corp dev rarely do buyout deals. For buyout it's not common at all.

Before landing on my current position I was debating between growth equity vs hedge fund. In fact I had two tentative offers from HK based hedge funds (like MD called after interviews and asked about next steps).
Ultimately decided to try growth first cuz I like to work in a team environnement and work closely with entrepreneurs. Plus it's a global brand with better prestige, so might broaden my exit oops. The downside - I need to source deals and base pay is 50% less (not to mention bonuses)
I was also interested in buyout (there's a new gen of retiring founders in China planning for succession) but my background couldn't get me straight into buyout funds.

As someone who studied Chinese for many years but has never lived in China despite a lot of interest on my part, I'm curious: how hard would it be for me to make the jump to China within PE/VC/IB? Would it be far more likely at a multinational firm to move NYC->China or are some local firms open to foreigners?

Global fund NYC-> global fund China team sounds a lot more promising, maybe doable if you are on a major multinational deal and stay at Beijing office for execution/portfolio management for like six months and start from there. But honestly I've never met any non-Asian sub-VP investment professional at leading PE/VC funds in China.
Language is one thing but the bigger issue is culture. You need to blend into the team and build trusting relationships with executives/intermediaries. In a country as homogenous as China, it's just hard.

 
Jan 24, 2020 - 9:04am
  1. Can you talk about the deal flow and experience that you will get at a MF in China, is it comparable to the U.S. or Singapore?

  2. Corp Dev to MF isn't a traditional route in the U.S. How common is that in China? Assuming BB IB experience is deemed a better experience for PE exits, does that mean BB IB analyst will exit to MF easier?

  3. Can you talk about pay in China from Associate to Partner? And break it down into 1st year - 2nd year and so on. Is there a direct path from Associate to Partner?

 
Jan 25, 2020 - 7:19am

RichChigga:

1. Can you talk about the deal flow and experience that you will get at a MF in China, is it comparable to the U.S. or Singapore?
  1. Corp Dev to MF isn't a traditional route in the U.S. How common is that in China? Assuming BB IB experience is deemed a better experience for PE exits, does that mean BB IB analyst will exit to MF easier?

  2. Can you talk about pay in China from Associate to Partner? And break it down into 1st year - 2nd year and so on. Is there a direct path from Associate to Partner?

  • China is more growth-oriented, very few control deals. And honestly deal flow at MF could be worse than leading local funds (like Hillhouse, PAG). HH is really defining the PE landscape in China with game changing deals that others just don't even have access to (credit to their hedge fund heritage that built relationships with public companies for carve outs and buyout deals, and their early investments behind almost all the sizable tech companies also helped create an unparalleled ecosystem/network)

  • For buyout, banking is definitely required, but for growth equity it depends. In China the recruiting process is much less structured and background requirement is relatively flexible (some headhunters would post "BB/MBB/CD at big tech preferred", in the same line). Preferably you would have a banking or even consulting background to prove that you could do the work, but if you could get an interview with networking and ace the case study then it's still doable. For me, my Corp dev experience gave me a lot of deal experiences that I could speak about during interviews. Most growth deals in China are done without BB as advisors and consultants generally don't get a full view about the deal, so comparatively my deal experience is what helped me stand out i suppose.
    That said at most growth funds you would still see more ex bankers than any other type of background for sure.

  • Pay is global pay. But fewer MBAs, most just go straight up from associate to VP.

  •  
    Jan 26, 2020 - 8:38pm

    Thanks for the info.
    1. Can you also talk a little about the recruiting process? You did mention that it is less structured, so is the only way in only through networking? If you're coming from a U.S. IB background, will you get look at? What if you come from a U.S. EB, will you still get the same type of opportunities as BB?

    1. Can you elaborate on pay? When you say global pay, what exactly do you mean by that? From my understanding pay in PE varies a lot given fund size and etc. Are you saying that MF China pay is the same as MF U.S. pay?
     
    Feb 4, 2020 - 2:17pm

    RichChigga:

    Thanks for the info.
    1. Can you also talk a little about the recruiting process? You did mention that it is less structured, so is the only way in only through networking? If you're coming from a U.S. IB background, will you get look at? What if you come from a U.S. EB, will you still get the same type of opportunities as BB?
    1. Can you elaborate on pay? When you say global pay, what exactly do you mean by that? From my understanding pay in PE varies a lot given fund size and etc. Are you saying that MF China pay is the same as MF U.S. pay?

  • Headhunters or networking. Interestingly most of my colleagues got in via referral, but we do use headhunters. In terms of background, if you want to work in China, BB IBD is definitely still gold but I'm not sure about EB - never met them on Chinese tech deals. I think even local boutiques (such as China Renaissance or even Lighthouse; in China we call them Financial Advisors or FA) are better than EB, simply because you would have more relevant deal experience there. I've seen a couple of growth deals run by both CR and a BB...and CR has underwritten a few US/HK IPOs alongside BB as well.

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