Breaking into Growth Equity
Hi everyone, I'm looking for advice on navigating a career in Growth Equity. I'm mainly interested in the top players (GA, TA, Summit, Insight) and Megafunds with GE divisions, but also looking at other strong funds (Spectrum, Stripes, JMI, TCV).
It would be great to hear thoughts from the WSO community on the following:
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Recruiting: is it better to start at a BB and recruit for Associate roles at GE shops or are there substantial advantages to getting into GE out of undergrad? I'm aiming for the top firms.
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Responsibilities: I know most of them are very sourcing/cold-call heavy at the junior levels. What is the breakdown for an Associate of sourcing vs. deal execution/analysis?
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Compensation: I've heard the top firms are in-line with PE comp (~$250K all-in for Associate). I also read on here that Insight gives juniors carry?! Is this true across the Growth Equity landscape?
Apologies for the lengthy request, but I would really appreciate if anyone could touch on any of the topics above or general advice for someone in my shoes.
you are aiming only for the top players, but are you a top candidate?
As I mentioned, I want to pursue all the strong funds in growth equity, from GA to Stripes. Wouldn't call myself a top candidate, but incoming SA at a BB/EB, so wanted to gather some information as I contemplate recruiting FT in GE vs. starting in IB after undergrad. I was also in the recruiting process with a few GE/PE funds and ultimately accepted my IB offer just because I got it so early, but I know I want to exit to the buy-side
"MF with growth arms" does this refer to bain cap tech opps, apax partners digital etc?
Yea I was thinking about those as well as at BX, KKR, TPG.
There are a lot of posts on this forum explaining why you should do IB before buyside, so you can go read those if you’re interested. Personally, I don’t understand that reasoning. “IB lets you see more deals, gives you a broader exposure to finance, etc.” Sure, but if I want to work on the buyside, why would I wouldn’t I work on the buyside ASAP? Wouldn’t the best preparation for investing be, you know, investing? If you get a role out of undergrad at a top shop or one of the other funds you mentioned, you won’t have a problem with exit opps, though they’ll be more constrained than in IB (obviously).
I can give my two cents on recruiting. For me, it was easier to get my foot in the door in GE than IB because I was a non-traditional candidate. My resume screams tech/ML/startup, but not really traditional finance, and that made it way easier for me in GE compared to IB. I also leveraged this experience and did a deep dive on a couple verticals I had exposure to on the tech side.
I've also heard both arguments: 1) go to IB first because of the optionality and because it will be harder to recruit to a better fund out of an analyst program and 2) go straight to the buy-side because you get a head-start and you get to skip IB.
Seems like your background and circumstances made your decision on GE easier. I think my resume makes a good argument for GE, I'm involved with the early-stage startup/VC space, but will be headed to a BB/EB next summer. I think Growth provides the best of both worlds in terms of my personal interests-- evaluating business models, meeting high growth/tech companies, exposure to modeling without the work revolving around financial engineering. In contrast to many on WSO, I actually enjoy deal sourcing (not cold-calling per say, but the networking, attending conferences, meeting founders).
Can you share what the sourcing model looks like at your fund? And how much you spend on execution vs. sourcing?
SA is for next summer; so can’t really speak to that yet haha
Two years late. What kind of experience did you have in tech/startup? Was it an engineering or business role?
Am now analyst at MF program (not growth equity) but also was thinking about this decision after BB SA stint. Reason I ended up not doing GE out of UG was too much time focused on sourcing. Most of these shops at analyst level are all just cold-calling and fund management, so you don’t learn the modeling or investment rationale that you’d learn from banking. Ended up choosing another buy-side investing role with less industry exposure (definitely don’t learn as much about the GE style transaction or the hot industries) but am learning a lot about modeling and financial expertise for crafting an investment deck.
Do you think at the associate level, GE makes more sense/you can gain some tangible skills besides sourcing?
I'm an analyst at one of the funds you mentioned. You definitely can / do build skills outside of sourcing, depending on which fund you're at. Some funds are incredibly sourcing heavy, which I would stay away from (be really clear on what the role entails when you interview). Mine is much less so, though it's still a priority when not working on something live. I've gotten solid execution reps and in hindsight am really glad that I made the decision to forego a return IB offer to go straight into GE. More generally, the opportunity to learn from some of the top investors in the space (perhaps biased) on a daily basis has been absolutely awesome.
I knew I wanted to get into tech investing after two years in banking, but was pretty concerned about my progression outlook vs. an IB analyst when it comes to an associate role. Pound for pound, an IB analyst would probably be stronger on the modeling side, but I think my experience actually evaluating investment opps, writing memos, working with port cos, sourcing, and overall understanding of how the industry works would allow me to recruit very competitively with anyone if I decide to move elsewhere.
Feel free to DM me if you want to chat more - my fund isn't hiring but I field a lot of calls from UG students and would be happy to provide some guidance FWIW.
do you think you could move from your analyst role to tech investing given the more limited industry exposure?
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