Advice on Industrials & Business Services PE
Hello everyone!
I am currently a second year investment associate at a smaller growth equity fund ($100-200M Fund). I have been trying to pivot to a larger fund and recently got an interview at a large fund within their Industrials and Business Services investment sector ($1-2B Fund). Does anyone have advice on resources and/or practice models within the industrials space? I am not currently focused on that sector so anything would be helpful.
Thank you!!
I'd comment that Industrial / Business Services is a very broad space (an HR firm is very different to a chemicals manufacturer), but the key similarity is that their customers will (typically) be other businesses, and so diligence areas will focus on this (as well as the usual stuff). Items like customer contract types, customer concentration, ability to pass through prices, value chain positioning, etc., will have a greater role.
But candidly, the capex at a consulting firm will be totally different to an aerospace manufacturer. With so broad a grouping, it's difficult to make any general statements or recommend any general resources.
On the flipside, this is a good thing! You shouldn't be expected to know any niche modelling (like infrastructure, FIG, etc.) Just take some time to think about key risk areas, value chain positioning, that kind of thing, which might be specific.
Thank you, that is super helpful!! Is there anything that you would suggest I review? Specific trends to keep in mind? Etc.?
It's difficult to point to anything specific - if you have access to broker notes, then I'd pick a couple of sub-verticals (aerospace, automotive, recruitment, chemicals, etc.), choose a couple, and try to be able to speak articulately about it.
It'll be impossible for you (or anyone) to be able to speak to the entire space in detail, and the trends differ between them aside from the obvious mentioned above, so choosing a couple that interest you might be the best approach
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