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Hi Fishes,
I have offers for Data Scientist role in the following companies
Unilever
Samsung
athenahealth
Larsen & Toubro Infotech
Citiustech Healthcare Technologies
Accenture
I am looking out specifically for good projects rather than to focus on compensation. Can you guys suggest which one would be best in this case.
YOE 7yrs
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LMM PE vs. FAANG Product Manager vs. MBB?
this is quite the AMA! 🙄
I could be a sister. You don’t know that! (Sadly, the stats are overwhelmingly in favor of your being correct).
Any suggestions on helpful resources for interview prep for PE, especially for someone with little finance knowledge?
Valuation by Tim Koeller (former McKinsey partner) is a classic book that’s good for helping you understand the core principles of finance. For modeling and LBO learning specifically, my favorite resources are MultipleExpansion, Macabus, and Street of Walls
Which consulting firm were you at?
Was it hard to give up the comp/guaranteed trajectory for start-up? Were you forced out at your firm or chose to leave voluntarily?
First things first - no thing as “guaranteed comp” especially past the associate level. It’s true that you have a nice salary and a “target bonus” (which we may see some slippage on in the next 1-2 years) but in the long run your comp will come from carry and that is anything but guaranteed for a wide variety of reasons.
To your second set of questions - yes to both. I was “forced out” in that my firm has a strict two and out policy. But I also left voluntarily because I realized that traditional leveraged buyouts aren’t for me - I’d rather work with more agile, fast growing, and quite frankly, interesting companies. I felt like I’d enjoy the startup experience and it’s something that’s highly valued in growth / VC, so I decided to call it a day and leave.
Not all firms boot out their associates (although the larger ones as a rule tend to), so if having a “career track” role is important to you, find a firm that lets you do that. I went into PE recruiting with the mindset that I would want to go to a larger, brand name firm for 2 years and then try something else (bschool and startups were the options I was considering), then re-evaluate.
Thanks for doing this!
How long did it take you to prep for interviews?
and did you have a finance-oriented background in your education or experience (eg studied finance or part of the PE group)?
What was recruitment process like?
Does PE feel “powerful”? I work on PE diligences and it’s cool, but the investors seem like they have the true influence in their decisions
Great question - I admittedly joined PE from consulting because I wanted more ownership (which is of course what everybody is looking for) and thought that I would get more of that. And you do - to an extent. Remember that the associate role is the most junior in PE and 95% of what you do is (1) business / industry / financial diligence (aka, “analysis”) and (2) managing third party diligence / deal streams (most of whom are doing analysis for you or with you to determine if they want to lend you money or co invest in your deal).
In short - your job as an investor is to “pick winners.” After you close the deal, you obviously have ownership of the company, but practically speaking that translates itself to board seats and weekly calls while your management team runs the company. In truth, if you’re getting involved a lot, the deal is probably not going well.
It’s a big part of why I wanted to try startups - (supposedly) you have more agency and if I want to return to investing, I can more easily do so having already done it for 2 years already (and if I were to return, I’d go earlier stage anyway).
Is the comp at a MM/LMM fund even much better than consulting?
Did your consulting firm help you transition somehow, or was it still uphill just like all consultants against the bankers?
As a rule middle market comp at $1-$3B latest fund size is probably $225-$250K (just rough ballpark here, varies on geography). Lower middle market is more variable and sometimes you get paid substantially less (have heard of $175K associate comp before), although this can vary depending on geography again (low COL cities tend to have smaller PE firms than the traditional hubs of NYC, SF, and Boston) and other comp such as co-invest.
As a rule, I’d advise folks to choose to go into PE because of a deep interest in the work and not the comp. You can come out $30 - $70K per year “ahead” of the comparable role in consulting had you stayed, but the flip side is that the work can be less interesting (depending on your personal interest), the hours more variable, and the culture potentially less collegial and friendly.
My consulting firm was very helpful but at the end of the day, you have to connect with the headhunters and pass the modeling tests and interviews on your own which requires a lot of willingness to self-study and network.
What is your role at the startup?
The sought after (or dreaded, depending on your perspective) “jack of all trades” - but mostly focused on product and marketing. Fortunately for me one of our co founders has a PE background so I’m hoping to not get saddled with all the finance / fundraising work that comes up 😂
Can you explain more about the rigidity and unpredictable hours? Compres to consulting, how are the hours different in the way they’re unpredictable?
I don’t know what your BCG experience has been like, but one of the highlights of my consulting experience was how flat things were. I felt empowered to lead steercos and run with things on key issues for the case. Private equity, especially at big firms, is a lot more hierarchical and there were times that I was lucky to lead a diligence call, let alone run a major work stream on my own. Perhaps I was a better consultant than private equity associate, but my sense is that this isn’t too uncommon.
Hours are really feast or famine in PE; some days I could get in at 10, go to a workout class at 6, and then call it a day (had a 3 month stretch where this was the norm and it was sweet). Other times I’m working till 2 am... on Saturday evening. I think the difference is that deals can just heat up out of nowhere and your vacation / weekend plans just get borked. I didn’t really get that in consulting; even though my “average” hours were the same or maybe even tougher, it was definitely more predictable than in PE.
I will say that my perspective is probably colored by the fact that I no longer have the same willingness to stomach weeks of long hours. I guess I never would’ve predicted in my early twenties how quickly I would put more value on life outside of work, but I guess that comes with getting older.
Did you reach out to headhunters or did they reach out to you?
Good to know thanks! Did you reach out to HH for specific firms?