IB vs Private Credit Offer. How to chose?

When deciding between an offer from a small Investment Banking (IB) shop and a small Private Credit fund, it's crucial to weigh the pros and cons of each based on your career goals, learning preferences, and the kind of work environment you thrive in. Here's a breakdown to help you make an informed decision:

Small IB Shop:

• Pros:

  • Direct Learning and Mentorship: Working closely with MDs who have extensive experience and a significant number of deals under their belts can offer invaluable learning opportunities.
  • Responsibility and Growth: The chance to take on a lot of responsibility early on can accelerate your learning curve and potentially your career progression within the firm.
  • Culture: A good culture that aligns with your values and work style can significantly impact your job satisfaction and performance.

• Cons:

  • Workload: Direct reporting to MDs and taking on significant responsibility might translate to a heavier workload and longer hours.
  • Specialization: While specializing can make you an expert in a particular niche, it might also limit your exposure to a broader range of experiences and sectors.

Small Private Credit Fund:

• Pros:

  • Structured Growth: A clear, structured path for progression from analyst to associate can provide stability and clear expectations for your career development.
  • Team Environment: Reporting to associates and VPs, you'll likely work in a team setting, which can offer support and collaborative learning opportunities.
  • Growth Potential of the Fund: Being part of a fund that's looking to double its AUM presents an exciting growth opportunity and the chance to contribute to its success.

• Cons:

  • Compensation: While the base salary might be higher, the total compensation package is less compared to the IB offer, which could be a consideration depending on your financial goals.
  • Less Direct Exposure to Senior Leadership: Reporting mostly to associates and VPs might mean less direct mentorship from the top leadership compared to the IB shop.

Decision Factors:

• Career Goals: Consider where you see yourself in the long term. If you're aiming for a career in investment banking or private equity, the IB offer might provide a more relevant experience. If you're interested in credit markets and debt investment strategies, the Private Credit fund could be a better fit.
• Learning Style: If you prefer a more structured learning environment with clear progression, the Private Credit fund might be more appealing. If you thrive in fast-paced environments with direct mentorship and are ready to take on significant responsibility, the IB shop could be a better match.
• Work-Life Balance: Consider how much weight you give to work-life balance. A more structured role might offer more predictable hours, whereas a role with direct reporting to MDs might demand more flexibility and longer hours.

Ultimately, both options present unique opportunities for growth and learning. Reflect on your career aspirations, personal preferences, and values to guide your decision. Remember, there's no one-size-fits-all answer, and what matters most is choosing the path that aligns with your goals and where you see yourself thriving.

Sources: On-Cycle, IB Offers, Hair Splitting, Depression, and "The Path", Top Private Credit vs IB for Developing Investor Skillset?, Buy-side vs sell-side path to credit funds, Take which offer: Corporate Finance at Big Tech (Google, Microsoft, Apple, Facebook), Valuation at non big-4, or boutique IB?, Internship Choices (PE vs IB)