What is Corporate Finance like?

I really love the aspect of making money and hope to own my own business one day (doesn't have to be huge, just my own). So how is corporate finance vs wall street? How is the pay in CF and who are the big money makers in CF besides CEOs? Also at the moment I'm only a freshman, but I'm thinking of double majoring in Finance and Accounting w/ Computer Science as a Minor or maybe Finance and Computer Science w/ Accounting minor. Do you think I may be over doing (trying to be a well-rounded applicant for future jobs)? Is it true that a lot of Consultants on WS get CEO job offers in the CF world?

Comments (35)

Feb 12, 2012

You should read the forums, start with harvardgrad08's corp dev thread ad STorIB's My Case for Corp Fin thread

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Feb 12, 2012

Pay:
-50-70k all in first year with small, single digit raises every year in CF. Depends on location and firm. For example CF for Target in Minneapolis or John Deere in the Quad Cities is going to be closer to 50k while CF for some hot tech firm in Chicago or Manhattan will be closer to 70k. (cost of living is drastically different though so you'd probably be effectively making more at the F500s located in random small cities)
-100k+ all in first year in IB

Hours:
~50 hours a week with some crunch time every once in a while. 8:30am to 530pm or so in CF.
-80-100+ hrs/wk in IB. 9am to midnight or later +5-10 hours on sat/sun too

Work:
-CF is usually rotational and involves an accounting rotation or two. Much lower pressure, set deadlines, few surprises
-Tons of surprises and stress and ever-changing deadlines in IB

Exit ops:
-In CF you could go get an MBA and rebrand yourself to try and get into IB but in this economy it will be tough and HF/PE is out of the question with no past deal experience. Consulting is however very much an option. More likely you're just going to move up the corporate chain into middle management making 100k out of MBA with small single digit raises every year
-After 2-3 years of IB you can pretty much do anything. PE/HF, MBA, etc.

Overall if you want a more relaxed, low risk life with significant time outside of work to pursue hobbies, hang out with friends, and get married go with corporate finance. The pay is solid but don't expect the models and bottles that go along with high finance jobs. If you thrive under stress and want to be as succesful as possible then go with IB or a buy-side gig out of college. Either way a finance/accounting major will put you in the perfect position to choose either one when the time comes, no need to decide now. Focus on getting an excellent (3.7+) GPA, take part in extra curriculars, and try and get any finance internships you can get your hands on freshman and sophomore year.

    • 1
Feb 13, 2012
Raptor.45:

Pay:
-50-70k all in first year with small, single digit raises every year in CF. Depends on location and firm. For example CF for Target in Minneapolis or John Deere in the Quad Cities is going to be closer to 50k while CF for some hot tech firm in Chicago or Manhattan will be closer to 70k. (cost of living is drastically different though so you'd probably be effectively making more at the F500s located in random small cities)
-100k+ all in first year in IB

Hours:
~50 hours a week with some crunch time every once in a while. 8:30am to 530pm or so in CF.
-80-100+ hrs/wk in IB. 9am to midnight or later +5-10 hours on sat/sun too

Work:
-CF is usually rotational and involves an accounting rotation or two. Much lower pressure, set deadlines, few surprises
-Tons of surprises and stress and ever-changing deadlines in IB

Exit ops:
-In CF you could go get an MBA and rebrand yourself to try and get into IB but in this economy it will be tough and HF/PE is out of the question with no past deal experience. Consulting is however very much an option. More likely you're just going to move up the corporate chain into middle management making 100k out of MBA with small single digit raises every year
-After 2-3 years of IB you can pretty much do anything. PE/HF, MBA, etc.

Overall if you want a more relaxed, low risk life with significant time outside of work to pursue hobbies, hang out with friends, and get married go with corporate finance. The pay is solid but don't expect the models and bottles that go along with high finance jobs. If you thrive under stress and want to be as succesful as possible then go with IB or a buy-side gig out of college. Either way a finance/accounting major will put you in the perfect position to choose either one when the time comes, no need to decide now. Focus on getting an excellent (3.7+) GPA, take part in extra curriculars, and try and get any finance internships you can get your hands on freshman and sophomore year.

Can you go into Venture Capital?

The Four E's of investment
"The greatest Enemies of the Equity investor are Expenses and Emotions."- Warren Buffet

Feb 13, 2012
Feb 13, 2012

TCB - taking care of business.

@art.vandelay, you should like that one.

Feb 13, 2012

Bravo, sir

Feb 13, 2012

it's going to depend on your focus (fp&a, financial reporting, controllership, treasury, etc.), business area (corporate level, cost center, revenue segment, etc.), available IT systems (SAP, COGNOS, excel, etc.), and specific finance and reporting processes of the department (are you involved with the close, how often are forecasts updated, are there weekly/monthly reports, etc.).

an fp&a job for a revenue segment where scenarios change and new products are created will be far less regimented and structured than a financial reporting role where every month the same sequence of steps are replicated.

it will also depend on where you are in the finance cycle. if the process is to update the forecast once a month, and it typically takes an entire week to do so, within that week your tasks and responsibilities will be different compared to a week where you have a major product launching, or a quarter-end close.

Feb 13, 2012

Bird is spot on. Basically, it depends. If you're in some sort of FP&A or Analytical Finance type group, much of your time will be spent making PPT presentations and doing work in Excel. Additionally, if you work for a company that is particularly data intensive, you may spend a fair amount of time working with Cognos, Business Objects, SQL, Essbase, etc. You'll have to learn these in order to do ad-hoc analytics.

Feb 13, 2012

And fyi, those databases are not difficult whatsoever.

Feb 13, 2012

_bird_ and Poff pretty much summed it up. Corp Fin is such a broad umbrella that you could literally be doing anything. It truly relies on your focus and your groups work. I have a bunch of friends who are in Corp Fin just like myself but do completely different things that you wouldnt even think relate.

Feb 13, 2012

Cognos and Essbase at an extremely rudimentary level. Very simple forecasting once a month. Slightly more in depth forecasting once a quarter. People getting upset over $50k in a triple digit billion dollar company. The usual.

Feb 13, 2012

last bit so true!

it's dull and progression is all about soft skills

Feb 13, 2012

Close, forecast, ad hoc analysis on new business opportunity or new customer offering, keep boss happy, and try not to blow up over petty office politics and/or managemet trying to "manage" or "influence" the numbers so it is easier for them to explain to the board and some of the brilliant wallstreet folks on this forum. That about sums it up.

Feb 13, 2012

"Close, forecast, ad hoc analysis on new business opportunity or new customer offering, keep boss happy, and try not to blow up over petty office politics and/or managemet trying to "manage" or "influence" the numbers so it is easier for them to explain to the board and some of the brilliant wallstreet folks on this forum. That about sums it up."

Perfectly sums up my job as well.

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Feb 13, 2012

There have been many threads on this. Each bank is organised differently.

For some dcm &/or ecm will be under cap markets, lev under dcm or corpfin, research under markets or corp/fin or dcm/ecm...

Every few years management will change the organisation of the bank to rebuild links between different teams. This ensures that they all communicate and work well together. Different banks also have different strategic priorities (eg. Citi is more of a dcm bank and GS more of an ECM one), so this will call for different business models.

Feb 13, 2012

anyone?

Feb 13, 2012

They handle complex financings (e.g. across the capital structure) and capital restructuring and refinancing. A large part of their work is with converts.

A lot of guys from Duke on the desk.

http://www.wallstreetoasis.com/forums/merrill-ibk-...

Feb 13, 2012

very very small group.

Feb 13, 2012

Agreed Advisory88

They take around 5 new analysts each year. I have a buddy going into that group next year - I'm told almost all the new hires are from Duke.

I assume it'd be a great group for those interested in HF exit-ops.

Feb 13, 2012

Is this the same as Financial Strategy Groups at CS/Citi ?

Feb 13, 2012

bump...exit opps? Specifically the ML --> BAML group

Feb 13, 2012

anybody? I heard it was a top group at Merrill, was wondering how they are since the merger, specifically w/ exit opps.

Feb 13, 2012

one analyst went to Ares, alot went to distressed funds or special situation groups...

Feb 13, 2012

They also added restructuring into the group now. I think the group is now called corporate finance & restructuring

Feb 13, 2012

I interned in the "Finance Department" of a MM Bank last summer.

From what I can tell, they basically fulfill the same functions: Mostly Accounting, Regulatory reporting, managing liquidity (Treasury) and Tax functions. You can add in Corp Strategy at some places, for example Goldman. And then some banks have their Risk Management functions in their "Finance Divisions," using GS again as an example.

Most of what I saw was: Regulatory reporting, Accounting, Tax, Treasury and Risk.

And don't take my word for it, but somehow people tend to think it is less preftigious to work in the Finance Division in Finance, opposed to industry. I honestly do not know why. Seems like GE FP&A is more likely to get you into a better B-School than working in the Finance Division at Morgan Stanley. I am guessing because at Morgan Stanley, you already have people (Bankers, Traders) who are seen as more qualified people to admit into a B-School rather than the guy working in Finance at MS.

Feb 13, 2012

Finance is what James just told you. Corporate Finance (ie. at Barclays or Deutsche Bank) is a specific subdivision within the Investment Banking Department where you provide services to your clients on specific Corporate Finance issue (M&A, strategic alternatives, valutation, etc.).

I'm grateful that I have two middle fingers, I only wish I had more.

Feb 13, 2012

Cost center vs. revenue generator

Feb 13, 2012
SirTradesaLot:

Cost center vs. revenue generator

You are right. I did not read the question carefully, again.

Corporate Finance at JP Morgan is different than the Finance Department at JP Morgan.

Feb 13, 2012

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Feb 13, 2012