From consulting to business | Consulting on The Gateway

From consulting to business

Private equity, a household name business, or entrepreneurship – just some of your future options if you join a consulting firm after university

After several years in consulting, armed with a prestigious name on their CV and well-developed analytical skills, the majority of graduate recruits at top consulting firms move on - into industry, private equity, entrepreneurship or elsewhere.

With their consulting experience, they have a wealth of opportunities at this stage. In this article, we profile the most popular routes.

Private equity and venture capital

Around 10-20 per cent of consultants exit join the private equity and venture capital industry, which essentially assesses and invests in growing businesses or businesses that are struggling but have the potential to be improved.

During their stints in consulting, many of these consultants will have worked on corporate development projects - for example, commercial due diligence or target-scanning exercises - acquiring skills and knowledge that are highly relevant in the private equity and venture capital industries.

Most consultants opting for this route exit to operationally focused, middle-market private equity firms where their skills in improving company performance can be most leveraged, but some also go into growth equity or venture capital shops - for example, Balderton Capital or Index Ventures.

However, as MoveMeOn.com, the online members-only job board for ex-consultants points out, demand for these kinds of roles is high (40 per cent of their membership registers interest) but they can be in very short supply, especially as most larger private equity houses prefer to hire bankers.

My experience

Tom Hussey used to be a junior consultant at The Boston Consulting Group, where he focused on TMT (technology, media and telecoms), energy, and corporate development. He's now an associate at General Atlantic, a global growth equity firm providing capital and strategic support for companies.

Can you tell me more about what you do now?

For associates at General Atlantic, our time is divided between three areas: sourcing deals, executing them, and supporting portfolio companies. As a result, the role has a lot of variety.

A typical week could involve speaking to the chief executive of a potential investment, performing due diligence on a live transaction, or working with our portfolio companies to maintain and accelerate their growth.

Why did you switch from consulting to growth equity?

Working closely with talented entrepreneurs is fantastic.

I also enjoy having ownership of results; the team has to come to a specific recommendation and take responsibility for delivering against that.

What skills that you learnt as a consultant have proved helpful in your current job?

Evaluating business models and understanding an industry quickly has proven useful, especially when sourcing deals.

Soft skills, such as communication and presentation, are also essential - working effectively with senior management is a core component of the job.

Corporate strategy

The most popular and common route for consultants leaving their firms are strategy and development positions in FTSE 250 companies - 70 per cent of MoveMeOn.com members register interest in these kinds of opportunities.

Many move into "industry" by getting hired by the clients of consulting firms to support their internal strategy function.

Outside of strategy, consultants are also a good fit in any role requiring a mix of research, analytics, project coordination and personnel management skills. Functions that fit the above criteria include business development, corporate development, and some mergers and acquisitions and operations roles.

Benefits of corporate roles include a lighter work day, a more stable work environment, and the chance to build an operations skillset.

Disadvantages can include reduced benefits, less flexibility in choosing projects, managers, and colleagues, and unpredictable upward mobility (though not necessarily a bad thing as it can mean routes are available into many different parts of the business).

My experience

Robin Talbot used to be an associate in strategy consulting at PwC. He's now an analyst in the group strategy team at Tesco plc.

Can you tell me more about what you do now?

I work in the group strategy team at Tesco, which looks after two key areas: strategy and mergers and acquisitions.

We are basically an internal consulting house for Tesco, reporting directly to the chief executive and the chief financial officer. They come to us whenever they have questions and we answer their requests in the same way as we would in consulting.

Why did you switch from consulting to corporate strategy?

I worked in the deals strategy team at PwC where 90 per cent of the work was due diligence work for private equity clients. This type of work is great at giving you the consulting skillset as you work quite hard over very long hours.

However, I found that after a while I specialised in one area and projects ended up being similar. I wanted variety (more pure strategy) and wanted to see the impact of my work rather than seeing another report disappear into space.

Here I can see action being taken as a result of my recommendations, and I feel like I have much more impact.

What skills that you learnt as a consultant have proved helpful in your current job?

The skillset I've learnt at PwC has proved to be a fantastic foundation for my current position at Tesco.

As we engage in very similar activities (problem-solving, conducting meetings with external stakeholders, writing slides, analysis) I've found a range of soft and hard skills have been transferable.

Entrepreneurship

Consulting is a strong platform for wannabe entrepreneurs as it gives you a chance to observe how various businesses operate and find answers to complex business problems.

As many as 23 per cent of McKinsey alumni set up their own businesses, while Bain & Co London "graduates" have founded such companies as Innocent Drinks, shirtmaker Charles Tyrwhitt, and healthy breakfast product maker Moma.

MoveMeOn.com has recently seen a rise in the popularity of startup exit opportunities, be it founding a business or joining a young company.

However, the size of the company is often not necessarily as relevant to these consulting alumni as finding a new employer with a startup feel and ethos, with many choosing this route simply wanting to "stop advising and start doing".

My experience

Will Swannell used to be an associate at L.E.K. Consulting, where he focused on work for private equity firms and did one longer strategy piece for a large company. He's now the co-founder and chief executive of Hire Space, a venue booking website.

Can you tell me more about what you do now?

I am the chief executive of UK's leading venue website, Hire Space. We launched the site a year ago, but the first steps were taken while I was still working in consulting, during weekends and weeknights.

By the time I left, we had a number of venues on board and the website was well underway.

Why did you switch from consulting to entrepreneurship?

Before joining L.E.K. I was a teacher and I saw a great deal of underutilised space in various educational institutions.

I wanted to make this space accessible while providing an additional income stream to schools.

What skills that you learnt as a consultant have proved helpful in your current job?

My consulting skillset really helped in raising money.

I was able to present a convincing case to future investors by using market-sizing skills I'd learnt during my time in consulting.

Other options

40 per cent of consultants are interested in staying in consulting but switching firms.

The most popular switch is to a consulting role in-house or to smaller "boutique" consultancies, which are viewed as more entrepreneurial environments where junior colleagues get given more responsibility.

Another popular exit opportunity is the government. William Hague, current Leader of the House of Commons and former leader of the Conservative party, is a McKinsey alumnus, while Bain's Mitt Romney ended up as a US presidential candidate. It's more usual, however, for consultants to move into consulting roles in government - for example as special or policy advisors, often in the Cabinet Office.

Others join non-profits - both Bain and McKinsey have non-profit consulting arms (Bridgespan and Touch Foundation respectively) and many charities and non-profits, for example the Clinton Foundation, have a track record of hiring consultants.

My experience

Stacey Beard used to be a business analyst at McKinsey. She's now Head of Special Projects at beauty company Blow Ltd.

Can you tell me more about what you do now?

I'm Head of Special Projects at Blow Ltd, which is a startup in the beauty industry.

I work on the projects that are important to the company, and this currently involves running the e-commerce side of the business.

Why did you switch from consulting to an in-house role?

I loved McKinsey - it gave me core business skills.

However, I wanted to move beyond Powerpoint into execution and see the fruits of my labour.

What skills that you learnt as a consultant have proved helpful in your current job?

Lots of skills! Consulting gives you a great perspective on deciding what's important and what isn't - the principle that 20 per cent of your work brings 80 per cent of output absolutely applies.

Moreover, consulting has taught me to structure problems and my thinking - what the problem is and how can you understand it.

Last but not least, I've learnt how to clearly communicate my ideas. At McKinsey I often had to present my ideas to incredibly senior people - this taught me to ensure my presentation is crystal clear.

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