Continental Europe PE Funds and Recruitment Process
Hey everyone,
I am currently a second year PE Associate at a MM fund (>$1bn last fundraise) and have always wanted to live in continental Europe while I am still in my mid-to-late 20s. To that end, I'm curious what some of the good funds in the region are, what compensation is like, what the lateral recruiting process might be like, etc. I am not fluent or conversational in any of the European languages, if that complicates things further.
Thanks!
It would depend on the company, my firm has a PE unit that is fairly international and has staff that doesn't speak the local language.
tbh, our firm is non-traditional in that way because we are a larger operation in multiple countries, including rotation schemes for professionals etc
Funds: Continental Europe is a massive generalization since even MFs have started building up separate teams covering Spain, Italy, Germany, France and BeNeLux. For instance, KKR's strategy is to decentralize as much as possible from London while maintaining its IC here (don't quote me on it, heard it in an info session for MBAs, but it does look like it's true). EQT has been doing it for years, same as Cinven, Permira and to a lesser extent, BainCap. Case in point: Cinven's team in Frankfurt was the one calling the shots on the ThyssenKrupp deal, with London helping out.
At MM level, firms tend to focus on several geographies (even those that say "we cover Western Europe" actually do deals only in some of those countries), which brings me to a key deal driver for these firms: local roots. Or at least languages. As an English speaker (and only English), there's very little you could add to these funds that they couldn't find from a kid who went to HEC in FR or WTU in DE, then some BB/EB in London and then moved back home. S/he speaks the local language, has solid connections and consequently has better odds at originating than you can have in a reasonable amount of time. And at MM level, feel free to disagree but origination plays a much, much heavier role than at an MF.
Some interesting MM/UMM funds to look into are PAI, Waterland, Brdigepoint, Eurazeo, Hg, Montagu... There's a lot more discussion on this website about top MM players in Europe than what I can put in a comment.
Recruiting: much less structured and on a need-basis most of the time. Almost all mandates have a language requirement. As for the process itself, it's not that different from anything else you might find in London - paper LBOs, take home case studies, etc.
Comp: definitely lower vs. London, though cost of living should be adjusted too. Have some buddies who do PE exclusively focused on Spain from Madrid, for instance - not a bad life.
Hope this helps, your experience definitely appears valuable at least technically, but you need to do something about the language component. For better or worse, it's a hurdle that makes or breaks your candidacy.
Are candidates with a consulting/big 4 preferred in some offices within Western Europe? I did a search on linkedin and found lots of people with those backgrounds
Not sure about preferred per se, but I did see a noticeable amount of mandates mentioning big4 xp as a background they’re open to (some even mentioning that’s the only background they’re looking for, which I found weird). Anecdotally though, Continental Europe is much more open to Big4 ppl than London, esp. if you bring languages to the table.
Thanks, I found it quite odd when I saw (looking via LinkedIn) a noticeable size of people coming from KPMG
Wow! This was amazing, thank you very much! I had a sneaky suspicion about the local languages...I have heard anecdotally from friends in consulting etc. that the Amsterdam offices of their firms are much more English-speaking than other offices, would that also apply for PE firms in Amsterdam?
Also, sorry for not being clear, I am actually currently in PE in the U.S - do you mind discussing the compensation relative to here? I have heard that it is typically a good chunk lower?
I'm not in PE and can't give you figures but think that cost of living is generally lower in continental europe (varies between countries) but nevertheless, comp is quite lower. On the flip side you got free health care
I’m speculating here, but I think it’s also down to size of candidate pool. Pool of IB candidates is a lot smaller than the pool of Big 4 CF candidates, and the IB analysts have greater optionality than the Big 4 candidates so can pursue other opportunities less likely open to Big 4 candidates. If a MM PE house in [Insert Continental City] wants to hire an associate on short notice (processes are typically ad hoc), a recruiter can quickly get 5-10 good quality candidates from the local Big 4 offices, same can’t be said for IB candidates.
This is obviously less applicable to larger funds which are most likely only set up in the larger cities, so can hire from the local BB/EB coverage teams or are sufficiently attractive to get people to return from London for the opportunity.
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