Mid-Career PE Professional pivoting to PC

Based on the most helpful WSO content, here are some key points and advice for pivoting from PE to Private Credit and preparing for interviews:

Key Areas to Focus On:

1. Credit Thesis and Downside Protection:

   • Emphasize your ability to evaluate downside risks and develop a credit thesis. Private credit interviews often focus on how you assess the stability and risk of a business rather than just the upside potential.

2. Leverage and Debt Structuring:

   • Be prepared to discuss how much leverage you would put on a business, how you would price the debt, and the types of covenant protections you would implement. Your background in Leveraged Finance will be beneficial here.

3. Modeling and Case Studies:

   • Expect to perform a case study similar to an LBO model but centered around leverage, fixed-charge coverage, and debt service coverage. You might be given a CIM and a few hours to build a model and investment memo, then defend your assumptions to VPs and principals.

4. General Business Analysis:

   • Be ready to answer more general questions about how you think about businesses, focusing on the downside. Questions might include where you would invest in the capital structure and what risks you see in a particular business.

5. Why Credit vs. Equity:

   • Be prepared to articulate why you are interested in credit over equity. Interviewers want to ensure you have a genuine interest in credit and are not just looking for an easier path.

Recommended Readings:

• While specific readings were not mentioned in the context, revisiting Moyer and other credit analysis literature can be beneficial. Additionally, staying updated on the current credit environment, especially post-COVID, is crucial.

Interview Preparation Tips:

• Know Your Deals Cold:

  • Be ready to discuss your past deal experience in detail. Have an opinion on various aspects of the deals and be prepared to explain your thought process.

• Network:

  • Continue to network extensively. Building connections can provide insights and opportunities in the private credit space.

• Practice Technicals:

  • Brush up on your technical skills, especially those related to credit analysis and modeling. Ensure you can confidently discuss and perform these tasks during the interview.

By focusing on these areas and preparing thoroughly, you can effectively pivot from PE to Private Credit and excel in your interviews. Good luck!

Sources: Private Credit Interview Advice, Full-Time RE Private Equity Recruitment, Typical PE Credit Interview Questions, https://www.wallstreetoasis.com/forum/investment-banking/breaking-into-private-equity-from-banking?customgpt=1, Private Credit / DL Megathread