Hey everyone,
I’m a new junior analyst at a private equity fund, and I’m feeling pretty frustrated with how things are going. I was brought on to work in private debt, but after some team reshuffling, I ended up on the equity side. The deals I’m being assigned aren’t the most promising—lots of hurdles and low chances of getting past the investment committee. I also haven’t been able to do much financial modeling, which is something I was hoping to dive into.
It feels like I’m missing out on the quality deals and not getting the exposure or skill development I was aiming for. Has anyone been in a similar situation? Should I push to get on better deals, or just try to make the most of my current assignments and prove myself? Any advice on how to handle this would be much appreciated.
Thanks!
Based on the most helpful WSO content, here are some insights and advice for your situation:
Skill Development and Exposure:
Navigating Internal Politics:
Long-Term Perspective:
Handling Frustration:
By focusing on these areas, you can make the most of your current situation and position yourself for better opportunities in the future.
Sources: Likely Getting Pushed Out at End of 2 Years (LMM Buyout), Was it a mistake? A confused Private Equity junior., Q&A: 3rd Year PE Associate ($10bn+ AUM, MBO/LBO, equity, mezz, distressed debt), Likely Getting Pushed Out at End of 2 Years (LMM Buyout), https://www.wallstreetoasis.com/forum/private-equity/then-and-now-compbanker?customgpt=1
Are there "good" deals the team is working on and you're just not staffed on them? Not a lot of great deals in the market right now so could just be conditions (unless the other analysts are getting staffed on great projects).
If you’re a new analyst (basically no experience or skill set), why should you be on the “quality” deals? I don’t mean for this to be offensive because of course you should want and hope to get good deal experience for your career. It just sounds like from your post you’re primarily thinking about it from your vantage point, and not the firm’s vantage point. PE firms exist to invest on behalf of LPs because they have a fiduciary duty. And no analyst (or associate) coming in is a net benefit to the deal team when they first start out. In fact it’s a detriment because a live deal process is complicated and moves fast; teaching a new, inexperienced person is just not high on the priority list.
I’m not saying don’t “push” to get on better deal teams (do advocate for yourself when your can), but you definitely should demonstrate you can learn on your own and be competent on the things you are assigned to to motivate the firm to put you on better staffings. For example, you absolutely can learn financial modeling on your own (maybe not how to think about the assumptions in relation to an actual company’s dynamics, but the technical part of financial modeling should not be contingent on anyone else to teach you but yourself. Just go rebuild a bunch of existing models from scratch). Plus in some ways, it’s better to learn a bunch on your own and then be able to “perform above expectations” when you do get on a good deal.
This is absolutely not a knock on you specifically. The reality is in PE, if you can’t learn on your own and figure things out on your own, you’re going to struggle in the long-term (this is even more necessary as you move up). PE firms are just simply not setup to train people the same way IB firms are (barring a few MF-ish PE firms that have had analyst programs for like 10+ years), this is the case whether you’re joining as analyst, associate, VP, etc. By and large, this is why PE firms recruit banking analysts rather than directly out of undergrad.
(PS though. Most deals a PE firm sees get shot down in IC or even before IC. If a firm has too many “good deals” IC is approving, there’s a decent chance they’re not disciplined in their investing and/or are viewing bad deals as “good deals”. Also, learning what makes bad investments is just as important as learning what makes good investments.)
(PPS. Once you prove yourself as being a rockstar… you’ll probably be begging to get less staffings. Everyone wants the best people on their deal teams.)
Forgive me as I’m not aware of your full situation, the structure of your firm or your past experience.
If there’s been a reshuffling which you’ve been subject to… and you are a junior analyst I’d be shocked if you’re first in line for the best deals. I don’t mean this in a condescending way. Most likely you’re fairly fresh out of uni/college.
I came into my first analyst role post a 6 month at fairly respectable IB and as the most junior, shock, I didn’t get all the best deals; I wasn’t happy with the modelling exposure I got compared to my last firm; and consequently, felt like I wasn’t getting the IB experience. Fast forward to now 10 months down the line and I’m staffed on some great stuff that my seniors would love to have on their CV.
Give it some time.
It will be a combination of being fairly new, and as other comment mentioned, a lack of amazing deals atm all-round. Keep your head up, and importantly; hit the modelling hard in the hours away from work (will be excessive examples on your firms drive), so that when you come round to it you have a head start & really know what your doing.
Edit: jobless stole my line ^
I'm going to disagree with the commenters that are suggesting patience on your end. I was in your situation and left after a year with an associate promotion at a larger firm with much more volume where I got looks and responsibility on actual closed transactions that have changed the trajectory of my career. I went from a "pre-IOI deal work for deals we know will be passes" monkey to someone who can actually do the meat of this job and I'd probably be in that spot still if I hadn't made a change.
You are at risk of always being behind as it stands; the associate that is getting the good deal staffings ahead of you will continue to get the good ones - your partners rationale is that they want their most polished people working on the high priority deals, and the next time a good deal comes around they will pick the reliable / experienced junior every time unless deal volume gets crazy. They are in the business of doing deals, not optimizing your personal development.
There is some element of proving yourself and keeping your head down that people value in this field. In my opinion some of that is valuable, but it's mostly a filtering tool to find people that will deal with a high volume of BS. My suggestion is that in a few months you should start testing the market - there is someone in the world that wants to employ you and will let you do actual deals.
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