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Careers. in. Finance. The Track. (courtesy of Leveraged Sellout). Traditional Route. Traditional Route. The Back Office. The Middle Office. The Front Office. What Else is Out There?. Hedge Fund. Venture Capital. Hedge Fund.
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Careers in Finance
The Track (courtesy of Leveraged Sellout)
Hedge Fund Venture Capital
Hedge Fund • investment fund open to a limited range of wealthy investors • “Accredited Investors”: Have net worth greater than $1 million • restrictions on who can invest regulators stay away • regulators stay away almost any investment strategy • live and die by absolute return • named so because they seek to hedge risks inherent in their investment strategies • short selling and derivatives similar to life insurance • lack of regulations charge whatever they want • NAV can be billions of dollars
Big Names • Research based: • Greenlight Capital • Baupost Group • Pershing Square • Quant (nickels in front of steamrollers): • DE Shaw • Paul Tudor Jones • Soros Funds
Venture Capital • invest in early-stage, high-potential, growth companies • eventually earn money through an IPO or trade sale of the company • investors pay cash for shares in a startup company • typically high net worth individuals due to riskiness • VC team comprised of people with: • specific technology backgrounds • business or analyst backgrounds • take a role in managing entrepreneurial companies at an early stage • basket of 20 companies : • 12 going sideways, 3-4 marginal losers, 1-2 big flops, 2-3 big winners
People Behind the Scenes • Sequoia Capital • Apple, ATARI, Youtube, Zappos.com, Google, Electronic Arts, Cisco • John Doerr • Netscape, Sun Microsystems, Lotus, Amazon, Intuit • Bob Kagle • Ebay • Tom Perkins at Kleiner, Perkins, Caufield, and Byers • Compaq, Genentech, Philips Electronics, Tandem Computers
Private Equity • Mix between Investment Banking and Consulting • almost exactly like VC, except • companies have proven revenue • mostly just paper value that’s added
Big Names • Blackstone Group • Carlyle Group • Elevation Partners • Kohlberg, Kravis, Roberts (KKR) • Bain Capital • Goldman Sachs Capital Group • Apollo Alternative Investments