Interviewing as a Second Year
What are the upsides and downsides to consider in doing private equity recruiting as a second year analyst (rather than six months into the job). This is assuming you don't go through the process in year 1, rather than that you interview and don't get any offers.
Don't do it. Any potential advantages are marginal at best, and there are numerous disadvantages, not the least of which is that you have to do an extra year in banking.
Could you expand on some of the main disadvantages?
Lots of people make the auto assumption that if you are recruiting as a second year, you either:
A) did not get an offer the first time around (at worst) B) were not sure what you wanted to do the first time around (at best) C) wanted to do it first year but weren't able to for whatever reason (usually boiling down to not being prepared enough)
At best, you can convince someone it was B, but even that isn't a great bucket to be put in. Why? Because B (maybe some combination with C) is exactly the story that's going to be spun by someone who actually did recruiting but didn't get an offer first year. So you really have to sell your story. This also brings up another disadvantage: if you fail as a first year, you can try again having some experience under your belt (and if you're successful, you can be much more relaxed about the rest of your time in IB. Remember how it felt to have a job locked up at the beginning of senior year? It's just like that.) If you fail as a second year, now what do you do? Look only for immediate start roles? Not a great place to be.
Regarding the other post - let me address it point by point:
"Disagree with that notion. I feel you're much more prepared as a second year than as a first year and will come across much better in interviews."
The main points in a PE interview are that:
These are both things where your advantage as a second year over a first year is going to be marginal at best.
I'm also of the opinion that you don't learn a whole lot in your 2nd year in IB (relatively speaking). You learn a ton first year because of the high learning curve, it plateaus second year, then third year it picks up again as you start to learn management and delegation skills.
"Plus, you'll probably be less busy the fall of your second year so will have more time to study."
Just not true... A class of analysts just left, a new class (who are new and therefore not very helpful yet) just started, so there is a relative lack of competent analysts, and you somehow have more time? Not to mention it's a truism that IB hours are unpredictable.
Regarding the benefits of a third year in banking - if you're someone gunning for PE, you would much rather be doing your first year in PE than a third year in IB (regardless of location or whatever other benefits.)
I've already talked about the stigma you might face, but keep in mind this - I don't know of anyone who said "Thank goodness I waited until 2nd year to recruit" but I do know many who have regretted waiting until 2nd year.
I think the "stigma" of recruiting as a third year is incredibly overblown on this site. I recruited as a third year and that wasn't even mentioned in 75% of my interviews. In the interviews where it was, I just said that I was focused on learning as much as a could / getting better at my job and that was the end of it.
I agree that the third year itself doesn't add much value, but I think you learn exponentially more (in a way that's relevant to PE interviews) in months 6-18 than in your first 6 months as an analyst (at least in an industry group. Maybe it's a different story in product groups). Your first 6 months are focused purely on getting the rote technical skills down and chances are you aren't actually absorbing anything from the materials you're pull together. Once you're finally comfortable with that stuff you finally take a step back and start actually learning on the job.
I interview plenty of associate candidates and the difference between first and second years is night and day. The second years are just so much more polished and natural than the first years just because they're much more comfortable with what they're talking about. Sure, a first and a second year can build a dummy lbo model equally well, but I bet any 2nd year would be better at actually talking about the assumptions and drivers that go into it which is by far the more important part of the process at any PE fund.
Disagree with that notion. I feel you're much more prepared as a second year than as a first year and will come across much better in interviews. Plus, you'll probably be less busy the fall of your second year so will have more time to study. If you didn't recruit the first time around, there's no stigma to sticking around for another year and IMO it is tremendously beneficial.
Also, many banks let analysts move around after their second year, so you could do a third year in London or Sydney or Hong Kong or anywhere else which is not only a great experience but also looks great for b school.
I'll counter and say that two of my friends (from elite groups that everyone here jerks it to) recruited as second years. One left an MS/GS for a megafund. The other left a JPM/CS and got the same megafund but in a different strategy.
I think CHItizen makes some salient points, but I'd argue that strong candidates tend to end up where they deserve. In my experience, that's held true both in banking recruiting during college and PE recruiting after.
Granted, both these guys went to elite schools and had lofty grades, so they were the type of candidate that would've been competitive the first time around. Headhunters had no problem putting them in front of the best funds, clearly. They both took a third year (had an easy time, too) and then proceeded to their dream job.
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