I've been working in NYC doing valuation for under a year with a Big 4 firm, 141 Purchase Price Allocations and 142 assessment for goodwill impairment. I'm considering pursuing banking more and had a few questions:
(1) what exit options do I have?
(2) how easy would it be to transition soon into banking? PE or hedge fund? Asset management?
(3) is it harder for me to get into harvard, wharton, stanford working for a Big 4 valuation group compared to a banker or consultant?
(4) if i were to transition into banking, would i essentially start out as a new analyst? Would pay be the same as new hires?
(5) what banking groups should I look into? In college, I also worked in real estate transactional due diligence (~75 transactions, $2 bn total invested capital, 1.5 years experience) and here at the Big 4 I have worked with TMT, as well as industrials. At a fund I also worked at during college, I researched healthcare - so as you can see, I'm all over the board and need to narrow my focus. How should I do this?
Thanks in advance for your responses!
I think what Sternmasta said regarding the exit opps and MBA chances mostly applies to the auditors that come out of the Big 4. I know for a fact that some MBA programs have a cap for ex-auditors (like, under 5% of the class), but that's besides the point of this discussion.
I would think the skills you learn from Valuation would be quite useful in banking... although I could be wrong. Any thoughts?
Toblerone: Are you serious? This is the first I'm hearing about a cap on auditors for B-schools.
Yup, spoke with my professor who has been teaching at the same place for 20 years! Apparently some MBA programs don't like the way auditors think. Apparently it's not "Big Picture" enough for them.
Although I think it only applies to people with 2-3 years of audit experience (that is, Senior Associates and below). Once you make it as a manager at a Big 4, I think the cap is no longer in effect, since you'll have started managing people and not auditing all the time. Of course, there's not going to be a hard and fast rule on this cap, they do it for the sake of "diversity".
(1) B-school, boutique banking or MM banking, Corp Dev. (2) Probably need at least a year's experience to transfer to a boutique or MM bank but I'm not sure. PE and HF are significantly harder, you'd need b-school I imagine. (3) Yes it's harder but your work experience is only one factor, especially if you knock the GMAT out of the ballpark (4) Likely be an analyst all over again, definitely not an associate with 1 year experience at Big 4 Val... (5) If you're going for it aim for something that you're familiar with based on your work exp... if you worked on TMT stuff than look for TMT... stick to your guns
Monkeyinasuit: How would you define an "out of the ballpark" GMAT? Like, above 700?
Robface: from my understanding, a lot of people in valuation have the CFA designation. Are you going to get it? I think it may help the transition to other finance jobs...
Thanks everyone for the responses.
With respect to the CFA, I am starting it in June 2010. I'm about done with the CPA, which obviously isn't huge at all in the banking world.
I'll just talk to the people in my network and hopefully something materializes. Applying via websites has never gotten me far in the recruiting process. Knowing people had gotten me a few calls from banks and a few interviews in school, but I accepted the Big 4 valuation gig (explanation: exploding offer, bad economy, accepted it) before I really got into the bulk of the banking recruiting process.
Exactly, a 600 GMAT is pretty solid for H/W/S
CFA>MBA
LOL monkey in a suit has a 3.1 from a nontarget. the closest he's ever been to a bank is an atm and back office ops which he can't even get.
balooshi is a known auditor back office monkey with no life but to troll banking boards.
NONE OF U ARE IN BANKING GTFO. ur chances of moving are 0, esp in this economy. every laid off banker is going to business skool so ur fucked there too. GOOD LUCK LOSER BACK OFFICE.
lol nyu, enough said.
huh?
no 1, I am not an auditor. I am a transfer pricing consultant.
no 2, sternmasta has been outed on here many times as an a-hole with even less of a life but to bad mouth everyone on WSO. Doosh Bag
Sternmasta = LondonE1?
Robface, you're in a better position to transition into banking than other non-finance related candidates. In fact, accounting is a huge part of corporate finance so skills are very much transferable, and that allows you to develop a convincing story as to why you want to transition into banking.
I know a former accountant who transitioned into banking. He worked as an accountant for a bit under 2 years, and will be going in as a 1st year analyst. Also, don't listen to the tool above that keeps drilling how this bad economy will make it harder for you. Sure, there were better times, but the market (and I mean job market in banking) has opened up tremendously since the financial crisis.
Good luck.
I just made the switch from valuation (not Big 4), where I had 15 months of experience, to banking. It can definitely be done, you just have to get lucky.
Congrats on the move JimmyBobby! How did you do it?
What kind of valuation did you work on, and what industries did you cover? Do you think valuation techniques are transferable across different industries? (E.g. from Financials to Oil & Gas)
Honestly, I just sent out my resume via firm websites and got a call to set up an interview (first time ever to get a hit via website HR). I had a phone interview, then flew out to their office and ended up getting the job. At the valuation firm I worked at, I generally tried to position myself to get the transaction advisory / fairness opinion / shareholder buyout engagements, as opposed to 141s, 142s, etc. Although my former firm is a generalist shop, I don't know about the transferability of the skill set yet, as I start in 2 weeks. However, the interviewers seemed to think it was transferable.
robface,
I can't really answer your question, but had a couple of questions of my own for you since I really don't know much about Big Four financial services/valuation, but have seen it mentioned more and more recently.
How are the hours? Is there a busy season like auditing? What are bonuses like (if you get them) and do most people receive one?
The hours are way less than banking. If there isn't a lot going on, 45-50 hours a week. When things pick up or there is a deadline/project, I've personally worked approx. 70-75 hours a week. On some projects, you can work 90-100 hours a week if its super busy.
The busy season generally correlates with auditing from what I've seen. This is because companies need to test their goodwill for annual impairment around that time, as well as review the valuation work that other firms perform for the auditors. These past few weeks, things have been starting to pick up a lot. They cut a ton of staff, so there is still a lot of work but for half the people.
Bonuses are not at all like banking bonuses - I've been here only a short amount of time so I am not sure exactly, but I'll ask around and see. I don't even think you get a bonus until you hit the manager level.
I interviewed with a Big4 Transaction Services and they told me there are no bonuses. And the hours are very similar to what Robface said but I didn't know they ever got up to 100, he said during audit season they can get up to 85.
I know a few people who have made the transition. As a matter of fact I knew a few people who went into PE afterwards. I had a good friend of mine go to UPenn another to Chicago after Valuation. I don't think you should be too concerned about the MBA exit opportunities. Do a good job in the GMAT and you will be fine. The funny thing is afterward working in one of these outfits, pure IBanking will seem staid, your focus probably will shift to PE/VC/ Specialty Corp Dev. DCF’s, WACC’s and Comp pulling are the same everywhere.
I personally know many people who currently work in these groups from, NYU, Penn, G-town, etc.
The modeling/analysis skills sets you gain will be indispensable to a Corp Fortune 500, Venture Cap, or IB shop. I worked in one of these groups and when I decided to leave I received offers from Mid Tier IB/PE shops (public school grad). I wanted to work on Alt Energy, and Power, which I currently do. PM me and I can tell you more.
At what point do you recommend doing a MBA? After 2-3 years? Or after you make it to the manager level?
You can make the switch but you will probably have a lot more luck going with the networking angle at some MM IBs or Boutiques. Bottom line is that smart candidates that can model and articulate a good story are going to find work. I wouldn't waste time with CFAs and wouldn't bother with GMATs unless you're over 700. 600s are weak and are not going to help your cause. There are also some focused head hunters out there as well. I would suggest getting in touch with the ones that focus on your region. Good luck, J123
I don't know how the CFA is viewed everywhere, but I know that, during my interviews, everybody was very interested in my progress on the CFA (passed Level II). I'm not sure how relevant, if at all, it is to be banking, but I suppose that it demonstrated my focus, and I feel like it at least marginally helped.
2-3 Years is fine, 1 person went to Chicago as a manager, 1 to Penn as a Senior As, 1 to Duke as Senior As. If you do well on the GMAT then pitch the B school. I currently have a friend preparing for B school after 2 years; her targets are Harvard, Yale, Penn.
That is fantastic! Just out of curiosity, which office did they come out of? I mean, is location a big factor in how future employers/B-Schools view your candidacy? Say, NYC vs San Francisco vs Houston?
I know it's very hard for Big 4 to go to banking. Even unknown MM/Boutique it is a bit hard, though more manageable. When the economy gets better you can prob go to an unknown IBD job 50/50.
I was contacted to interview with a well respected group on wall street...if I get the offer, I do have a few concerns...
(1) The hours will be brutal...I can figure out how to survive, but I'll need to move closer to the office... (2) Am I jumping ship too soon? Should I wait a year before bailing on valuation after being in it for only a few months? That won't look too good on a resume. (3) I'm pretty sure my pay will actually decrease (base salary)...I imagine I'll get thrown in as a first year analyst with 10k bonus and a 70k base...my base at the Big 4 firm is almost 20% higher...can I negotiate this? (4) How up-front should I be with my concerns so that I don't burn any bridges?
I don't think banking is for you. Obviously the 70k base is way too low.
Its more about whether I can negotiate the base...
Obviously the overall compensation for IB will be higher w/bonus, and the exit ops are a ton better in IB for PE, but is it worth trying to negotiate the base salary to what I currently make?
This sounds fishy. Unless you came out of a MBA program and you join as a sr. associate or a manager due to a lot of prior experience, I seriously doubt any Big 4 would pay someone coming into a valuations group as an analyst more than a $70k base (even that, by accounting firm standards are high). And no, I'm not one of those guys that rip on Big4 employees - this is just based on my observations of friends and people on this forum on the pay range for Big4 firms.
My suspicions aside - I would worry about it after you get second/final round interviews. If you're already having doubts you won't be able to do the hours, then it's likely not for you anyway... I think for the negotiations... unless they REALLY want you and you're heads and shoulders above everyone else, you might come off as a real jackass. Esp, if you only have a few months of experience under your belt.
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