Growth Equity -> Private Equity
As the title suggests, what do the lateral opportunities look like from a top GE firm to a UMM-MF PE firm? If anyone has any experience or knowledge on the topic, would love to hear!
Looking at a GE Analyst offer atm, so i’m curious if there are associate lateral opportunities.
Bump. Interested to hear the exit ops there. Thinking of doing GE for associate years too, but wonder if that shuts off any traditional buyout route afterwards? Fine missing MF, but after banking could someone go GE -> UMM/MM buyout?
Probably difficult - especially if it’s a sourcing heavy role. Would switch it around if there’s an option.
Want to preserve anonymity but I did this, and I know other people at funds like Harvest, TB, THL, etc. who did this. Happy to answer any q's if interested. The short answer is obviously yes you can do this. You definitely have to be proactive with recruiters and develop some friendlies at the key recruiters so they know you actually want to move to buyout, believe the "why" of it, and will give you a shot or two with their clients. Actually think there are some advantages to it in lateral recruiting (or SA/VP lateral recruiting later on):
(1) Generally speaking, you get more deal reps in GE (albeit much smaller deals) so you have more companies/deals to talk about when lateraling
(2) Assuming Insight/TA/Summit/JMI/Spectrum/Silversmith type of GE (vs late stage venture), deals also tend to involve more creativity/thinking in GE (you may do a minority unlevered recap, a minority capital raise with a participating preferred security with a 3x cap, a majority levered recap, etc. etc.) so again just more experience to talk through
(3) As an associate, you're generally doing diligence on a more bilateral basis directly with companies (vs. all banked processes) so you get a lot broader analytical experience (the data is not going to be well packaged, readily available, etc.), so again good experience to talk about
(4) Again generally speaking but you're forced to think a lot more about companies, industries, investment theses in GE b/c you're seeing so many more companies, they're earlier so the thesis is less clear, etc.
Just my two cents but I am a believer in this path.
Would you mind sharing 1. what kind of feedback/reactions you got from headhunters? 2. were you able to interview with the MFs or smaller buyout shops? 3. what size shop did you end up at?
HHs definitely will challenge you to make sure you're good (esp. if your GE role has a sourcing component per the comment above) b/c it is a bit of a leap of faith (although it becomes less so each time they place someone from GE to buyout). My personal experience was that I found as soon as I got one interview and did okay/well in it, all potential disbelief was gone and they were fully in my corner with any/all other clients. But it takes one or two going well for them to believe it (this can also be achieved by getting to second round with xx fund that is not their client and telling them you have that going on. Would not bluff it though).
I interviewed at five of THL/Berkshire/Advent/Silver Lake/CVC/Permira/Warburg/KKR/Carlyle/TPG/Vista/Thoma/Clearlake, and work at one of those.
Just curious, why the desire to switch to buyout from growth? more comp?
The cause of my interest is just the opportunity to work on larger, and potentially more interesting, deals. I feel that it might be a better learning opportunity as well at the junior levels to get a strong foundation, which ultimately I would feel comfortable making the switch to GE later on if I so pleased.
But doesn’t make reps make for a greater experience? Associate programs at places like H&F offer the chance to work on 2, maybe 3, deals in 2 years. Seems like exposure is quite limited. Is there really a benefit in going so in depth into one company? Isn’t there a point where it reaches diminishing returns especially because the number of different business models and sectors you get exposure to is limited? If the end goal is joining a hedge fund, surely reps and a fast paced (as opposed to process oriented) experience is better? Would love to hear a counter argument cause I know I’m kinda wrong.
For me, it was first and foremost, wanting to invest in more mature companies and fundamentally have control over outcomes. Was sick of being minority or sitting backseat. Was sick of negotiating minority protections. And was sick of some of the operating growing pains in GE portcos that just don't exist in companies that are more mature, have been previously sponsor-backed, etc. Second, and also important, was long term earning potential. Woke up and realized that 6x'ing a $1B fund (GE funds tend on average to be smaller than bigger buyout funds) is the same $ carry as 2x'ing a $5B fund. 6x'ing any fund is LOL hard, certainly not easy to 2x a big fund like that but you get the point. Just a lot more $ to be made on average imo.
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