Going from Law Firm to Distressed Debt focused Private Equity Firm?
Hey all. Yet another question from a guy with a law background (bear with me).
How feasible would it be for a person who has 2 years of experience in Bankruptcy Law (Ontario, Canada) and has cleared CFA lv 3 to make the jump to the deal team of a distressed debt focused private equity firm? While I am well aware that many such firms have former lawyers in leadership positions (as obviously, their skills are an asset with these types of deals), it certainly doesn't seem to be the norm.
What would such a career jump look like?
In the American context, lawyers jumping to distressed assets in a business function isn’t common, isn’t super rare, and is more doable than other business side roles. With the CFA, you should be in a stronger position than if you only had your firm experience because you took initiative to show interest and finance knowledge. Networking will be 90% of the search, rather than applying blindly.
- Former Corporate Lawyer
I personally disagree with the above post. If you are looking to go into Distressed Debt or Special Situations there certainly are groups that have investment staff who are formally trained as bankruptcy lawyers. The only kicker is that these firms are for the most part in NY and California and they want talent who understand NY and Delaware law and have been in the nitty gritty dealing with bankruptcy claims for companies in these jurisdictions.
I think you would be a very compelling candidate perhaps at the associate level but there are no opportunities in Canada for this strategy.
This is what I said. It happens. It’s not the most common route to those roles, and most BK attorneys don’t go to the investment side.
Jeff Aronson (one of the founders of Centerbridge) was simply a securities attorney...I know lots of lawyers in PE, and even more in distressed. OP may want to look into HF investing as there are more distressed and special sit opportunities in Canada structured as a HF than PE fund.
Jeff Aronson graduated from law school when it was still a “profession” in the normal usage of that term. The hiring market, nature of legal work and education, and allowance to retool are completely different than when he left it.
Yes, as I said, distressed is easier to move into than run-of-the-mill PE. It is not the norm and not necessarily easy for BK/Rx attorneys to break into the investment side; this goes for top groups in this practice like Kirkland. You may know lots of lawyers in PE, but given how many corporate attorneys there are, it is still a rare and challenging move to make overall. For everyone who gets out of the dumpster of corporate law, at least ten fail and get no traction for an escape route.
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