How to become a PE analyst out of undergrad?

Really? I thought top students at Wharton usually go straight to the buy side

What about interning at a boutique PE firm AND their recent SaaS acquisition for the summer between sophomore and junior year? How "sexy" does that look on a resume when applying to BB IBanking for summer between junior and senior year?

Short answer: PE firms run lean and don't want to spend the money training and developing analysts when there are fields (e.g. banking) that produce candidates with the skillsets and experience they are looking for.

A lot of MM PE firms hire out of undergrad if you go to the right schools

As goblan says a number of PE firms do recruit out of undergrad, including some MM firms and many of the larger funds. But they are far more interested in your technical knowledge than most banks because of the factors Hugh Myron talked about. I had interviews with a "upper MM" PE firm and both first and second rounds were 100% technical and went well beyond what is in the ib interview guides.

they do. i am a summer analyst at a MF this summer!

edit: i go to a semi-target. it was mostly networking (one of the senior md's went to my school and knew a teacher who i TA for) along with a killer gpa. currently doing an unpaid equity research internship while attending classes, which allowed me to talk about investing knowledge.

mrdraper - wrt your last question on working at small vs. large PE fund, hard to answer, all firms are different. Don't think any two MF programs are really the same, for example

In general - at smaller firms, environment is less structured (e.g., with smaller teams) and will be chasing smaller companies/investments, which are often less sophisticated vs. larger companies. Thus, more likely to be working with B/C-grade management teams, who are not accustomed to the level of analysis that most PE firms require - this could mean there's more opportunity for improvement within small/MM buyouts, but takes lot of work to get there. Obviously, there are exceptions to this, as there are plenty of small companies run by excellent managers, and vice versa

Also would point out that there are a LOT more small/MM PE funds than large PE funds, so there's often more competition for deals in the middle market. The extent to which this is relevant will depend on the small/mid PE firm's strategy (e.g., will be less relevant for small/MM PE firms that try to avoid auction processes), but will generally have more competition in the middle

also, meant to add:

generally, what do PE pay structures look like? is bonus similar to the base salary (like banking) or do you get more of your money up front in your salary?

my friend got hired straight out to do pe in DC and he's getting somewhere around 55k with a 10.5k bonus

interesting...would have thought it to be higher. any details about they type of firm he's working for?

Aren't the hours generally better in PE than IB?

Out of all those groups, the only one you can check is Blackstone, bc none of the others hire undergraduates, and i'm not sure where you could find a Blackstone estimate.

The words of Carlyle Asia's director are:

"You have to be a genius who already knows everything he could learn from investment banking and who's accomplished a lot for us to even consider you[to hire you out of undergrad]

I think the roles for associates right out of undergrad vary quite a bit, but aren't a lot of associates spending most of their time doing market research, cold calling people, and sourcing deals in general?

If so, what do people in this kind of role generally get?

know a friend who's interning w/ ms peg this summer. college junior. not acct/fin background. hours are absolutely brutal, though. at the end of the day, you have to contribute something to justify the money and the "glory" of being a pe analyst you get right out of college, and the least you can do is by putting in additional hours (supposedly worse than banking counterparts at ms)

note that this is only for the hk office. not sure about ny/lnd..

I'm going into MM PE straight out of college (not NYC, cost of living for the city I'm going to is very, very reasonable) and my base and bonus are higher than those listed for the DC job on here. Not as high though as ibanking for a BB (but lower cost of living plus much fewer hours worked - 60 vs 90) more than makes up for it.

I know a kid who works as an analyst for a PE group within a BB that is co-invested in a deal with us. He works less than analysts in the IBD but more than me in terms of hours. Pay scale is exactly the same as the banking kids.

My first year PE analyst comp was 50k base and 25k bonus (no sign-on bonus). This seems relatively "light" but it was a start-up fund when I joined and we have closed on several multi-billion dollar front page type deals since then so my compensation has improved significantly.

I work 60 hours a week and rarely if ever on weekends.

You got offers from both? Take CCMP. Better name and better program.

CCMP is legit.

Audax has a sweatshop reputation, no idea about CCMP.

Echo the above on Audax. In addition to stuff on glassdoor (if I remember correctly, don't feel like looking it up now) 1-2 people I know have described it as a thankless sweatshop, as have some people at the top that I have met and looked it. Can't comment on CCMP though.

thanks guys! any info on CCMP would be super helpful. appreciate the insight.

Audax is definitely a sweatshop, but it is very well respective. You'll do a ton of deals and you'll get a lot of experience. Similar to investment banking, it is like "bootcamp." They don't pay that much relative to other PE firms because they hire an army of junior folks to dive deeply into every detail of every opportunity.

Bottom line: Great place to learn and position your career, but you'll work like a dog.

Both great places to launch your career. CCMP is already an "MF" as far as I'm concerned, so if that's your goal and they will career track you, I suppose that choice makes the most sense. It also has a better brand from a recruiting standpoint than Audax.

However, to echo compbanker on Audax -- the analyst program gets a bad rep because it's a meat grinder from a work-life balance standpoint... but honestly as an unencumbered 22yo you should seek out that kind of early career immersion, in my opinion, given that all of your 22yo competitors are going to be running equally hard at the big banks. I have also seen quite a few former Audax ppl at at upper MM and megafunds for their associate years, so I doubt you'll have a problem matriculating into an MF program if you want to go that route out of Audax. More importantly, Audax does so many f'ing deals that the kids who do 2-3 years in that program end up having more notches on their deal bedpost than most VPs at larger funds, and in my experience have the skillsets to reflect that.

As a meta/market comment: Audax -- along with a small handful of other institutionalized MM PE shops -- is uniquely set up to win auctions while still generating compelling returns. I bet if you look at market share in intermediated deals, Audax and maybe 10 other firms are doing 10% - 20% of total deals in a given year, with that percentage increasing over time. Consequently a lot of smaller MM vanilla buyout shops that are more focused on deal artistry (aka JAMMBFs) are essentially homeless right now. So while it may not be CCMP today, I would be long Audax from a brand reputation standpoint.

Do you have offers from both? Are both in the NY office?

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