Family business vs banking
Fellow monkeys,
Friend of mine has a family business, global brand in its niche and significant growth potential (expansion in adjacent markets) around 2-5m EBITDA as an indication of the size.
He is torn apart between the usual 2+2 banking PE and joining the family biz straight out of college.
What are in your experience the pros and cons of this move?
Would a 3/5 years career in IB/ PE help significantly down the line? (Networking, learning how a business is run, large exposure to different sectors/ seasoned professionals)?
I think the networking / learning how to do a business route via IB / PE is a very overrated concept. I would go straight into the family business and consider a MBA down the line to build out that network if needed.
I have two friends who did this. Neither ended up pursing an MBA and have helped their family business grow a few million in EBITDA over the past 5-10 years of working alongside their parents.
Hey can I PM you? I seem to be in a similar situation
The best way to learn how to be an operator is work in the business. Banking doesn't provide that experience. PE does from a very narrow, senior, managing to the excel model perspective but it doesn't give you the skills to roll up your sleeves within the business. If he ultimately wants to operate a business, working in the business is a great idea, especially a family business where there is a path to leadership / ownership. From a comp perspective, successful family businesses are awesome. Could he make more money in PE? Sure, but most likely at a senior level with plenty of carry. Many business owners make into 7 figures and own an asset worth several million. BIL's industrial plumbing business is valued at approx 50mm. He takes in a few mil /yr. Never went to college. Not that unusual. friend's bbq business brings in a few mil per yr (5 locations) and is worth several mil. when you include the RE which he owns separately (so can sell the business and still make solid income from rentals. Lots of ways to make huge money.
OP here, can I pm you?
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