VC firm or Credit PE analyst––which will better position me for banking?

A close friend of mine is at a crossroads & needs some help. I'm going to turn over my account to him and let him ask the question:

Hello everybody, I'm in a tough spot. I'm currently enrolled as a sophomore at a non-target. My freshman year, I worked/networked extremely hard and did a summer internship in private equity.

For the upcoming summer of my sophomore year, I managed to get an offer as a private equity & credit summer analyst at a top PE fund (think KKR/Ares/Apollo).

My issue is that recently a headhunter for a VC firm reached out to me and said they'd like me to work for them this summer instead. If I do this, then I'll have to renege on my offer at the aforementioned firm.

I'm not totally sure what my interest is, but I am heavily interested in tech. Their main selling point was that despite the VC firm not necessarily being a brand name, it would prove my interest in this next round of IB recruiting and increase the likelihood of my getting attention for TMT groups.

Outside of a TMT banking group, I'm not really sure what other industry/coverage groups I have interest in. Perhaps Lev Fin or FIG, but given my non-target background, I'm not even sure how much of a choice I'd get (beggars can't be choosers).

Another thing to consider, given the size of the VC firm and the informal nature of recruiting, I could probably stay on during the year / the rest of my time in school (assuming I did well). It could also turn into a full-time offer altogether.

Any thoughts on this?

Comments (10)

Apr 3, 2018 - 4:12am

Ask the HH waht your responsabilities would be as a VC intern. If you will be there just doing slides for LPs there is no point of going there. If you can get your hands on some interesting modeling/meeting start-ups/market analysis/competitors might be worth a shot. How big is the VC fund? How experienced are the guys working there? What's their background? These are the questions you should ask yourself for the VC. If all the associates/partners have an IB background at top tier BB or EB they will be able to help you get into IB somehow. If its their first fund or coming from a shitty background go for the PE fund, you cant go wrong with your PE fund. Think about where you are getting in rather than which group you want to get in.

Apr 4, 2018 - 2:11pm

Tend to agree that, for an internship, the top-tier brand outweighs the alignment with your interests. Employers don't expect college sophomores to know what they want to do forever, so you shouldn't have a hard time pivoting to a new discipline when it comes time for FT applications. Plus, the name-brand internship would help offset the non-target school on your resume. The VC firm might lead to a great opportunity, but the credit role might lead to many great opportunities.

  • 2
Apr 4, 2018 - 2:29pm

Agreed. VC firms typically have little skills overlap on the analyst/associate level. In our recent recruiting cycle - we had 4-5 candidates with VC internships and found they were much weaker than candidates with boutique IB/valuation/credit/private equity internships.

Apollo/Ares credit will give you an opportunity to go anywhere full-time. You'll get great experience that is highly favorable for IB recruiting. I'd argue to say that staying on full-time is also a much better career track if you end up enjoying the debt side.

Apr 4, 2018 - 3:27pm

Hey everybody,

Thank you for the great input. You all have really great points grounded in solid reasoning. I'm doing to turn down the VC firm, but tell them I'd be willing to work with them for an off-cycle internship if they're wiling.

A related question: what is the general consensus when it comes to networking / getting recommendations from my superiors? I come from about as non-target as you can get, and since my position is a sophomore role, I'm wondering if it's acceptable to ask to be connected with colleague's IB connections towards the end of my tenure? I really need just about every leg up I can get in the recruiting process.

Apr 4, 2018 - 3:39pm

Two thoughts.
1) If it's at all an option, keep an open mind about a full-time position with the private credit firm instead of going IB. Many IB analysts slog through 100-hour weeks for the privilege of exiting to that type of firm.
2) It's definitely acceptable and not too early to ask for introductions - you'll be applying to junior summer internships not long after your sophomore summer. If you do well and form a decent relationship with people at your firm, you can probably ask them this question point blank. "I'm interested in the IB route. Can you offer me any advice on when and how to reach out people? Is there anyone you'd be willing to connect me with?" This only gets tricky if/when they're offering you a return opportunity, but you're turning it down to pursue IB.

  • 2
Apr 4, 2018 - 4:01pm

That makes a lot of sense. I think I'll have a better idea of whether or not that's the type of work I'd be interested in pursuing long term after I've had a chance to work there for the summer.

I THINK, but am not positive, that they don't intend to give me a return offer, but who knows. Perhaps if I really knock it out of the park it's possible. I got the sense that they liked me and wanted to give me some great experience / a resume booster to help me out.

If I did get a return offer, you don't think going straight into private credit would hamper my career options down the road? I'd be from a non-target with no IB experience.. I DO plan to get an MBA to rebrand at some point fwiw.

Apr 4, 2018 - 4:58pm
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