How many target kids go straight to MF PE?

So basically, everyone's always saying that the top kids at targets don't even go to IB anymore, they all go straight to blackstone PE or something like that, but I wanted to know how common that is.

  • how many MF PE even take analysts besides blackstone?
  • how many analysts do they take?
  • kids who go to top targets, is it true that all the best kids go straight to buyside? I'd also be interested to see if it's more true at HYPW vs. like Columbia/Dartmouth/Duke

Comments (47)

  • Analyst 1 in IB-M&A
Jul 13, 2020 - 10:26am

I went to H/W and I can count on one hand the number of kids who went straight to a MF out of undergrad. It is not likely at all.

  • Prospect in Other
Jul 13, 2020 - 10:30am

Thanks. I thought it was probably exaggerated, but I had no evidence. Was it all BX or any other places? I think I've seen one or two KKR from H but that's it

Jul 13, 2020 - 10:51am

Columbia/Dartmouth/Duke student here. We send only 2-3 to MF PE straight after UG. These programs, which some firms like Carlyle don't even do, only take 3-5 kids for PE across the country, so it is extremely competitive. It's really not common at all and the kids who get it you kind of knew were going to end up there at some point.

  • Analyst 1 in IB - Gen
Jul 13, 2020 - 10:58am

People exaggerate a ton of stuff on this site. Especially when it comes to "exclusive" or "elite" outcomes like buyside out of undergrad. Would take everything you see on here with a HUGE grain of salt.

  • Intern in IB - Gen
Jul 13, 2020 - 11:16am

I can only think of ~5-6 over the past 3 years going straight to MF PE. Also a handful go to UMM PE, but it's not common at all

  • Incoming Analyst in IB - Gen
Jul 13, 2020 - 11:47am

>everyone's always saying that the top kids at targets don't even go to IB anymore, they all go straight to blackstone PE or something like that

No one said that. There is a general decrease in interest in IB though, and there are more opportunities to do other areas of finance out of undergrad than in the past.

Jul 13, 2020 - 12:06pm

almost no one. KKR takes 12, TPG, Carlyle, Bain, take maybe another 3-8. vista, Ares, etc. take another 5-10? include really good venture, growth, MMPE, UMM, etc. and the list expands to like another 30-40 maybe (Bessemer, summit, insight, Audax, etc) and 50-70 if you include the lower tier opportunities. so all in all, the entire class of PE kids is like a single class at a single EB or 2.

I think there are three emerging characteristics of why people make the decisions they do:

1) smart. this is a given and meant as a catch-all for your resume, GPA, etc. basically how you appear and what you can be identified / cut as. "smart" does not necessarily mean intelligent.

2) intelligent. How well you can piece things together, break them down, and come to the same or different conclusions and understand things on incomplete information using your brain. This related to "smart" and "#3" because those two feed into practices and a capacity to develop this, but they don't necessarily guarantee intelligence.

3) interest and exposure to investing. in terms of developing an investor mindset or actively enjoying the thinking process even if you're a bitch analyst there is the capacity and potential for being able to practice this interest in a buyside job. This kinda has to do with what clubs you are in or what previous jobs you've held but it's kinda just being interested generally in non-IB work that's like consulting but with a more real focus.

they're all kinda related but have their own role in determining why and who ends up where. someone with #1 can get an IB job, and with a little of #2 can get any IB job so to speak. but the 3rd, which doesn't necessarily mean anything and is just basically are you interested in what goes on is what ultimately determines going into PE over RX, or IB, generally. I think I've seen a decent number of people who in principle would choose pe>consulting>IB out of genuine interest but would rather do IB>consulting to get into PE better. but everyone's different, there's no hierarchy because people have differing priorities and interests, and who GAF at the end of the day! alright I finished my dump, back to work!

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  • Analyst 2 in IB - Gen
Jul 14, 2020 - 11:58pm

As background for my answer, I went to a semitarget but interviewed with a fair amount of the megafund analyst programs, got a few offers and wound up going to banking -- will explain my recruiting and decision process below.

For starters, probably a good answer to name the seven firms that have raised a buyout fund near or above 10Bn that have analyst programs: Blackstone, KKR, Warburg, Vista, SilverLake, Ares, Bain Cap. Note that there are other firms that have hired analysts in the past, and have either ended the program, or hire ad hoc (TPG, Carlyle, Leonard Green), as well as a bunch of other reputable growth or middle market shops that hire analysts (Summit, Insight, GA, Crestview, Cerberus, Audax, etc.) All in all, the universe of decent investment funds that will take an undergrad is actually larger than most people expect. Conversely, the number of analysts that each of these funds will take is much smaller than most banking groups. In total, the number of analysts at the seven big buyout funds listed first will be about 30 (about 10 apiece at vista and kkr; 2-4 at the rest). All of them have target schools with recruiting pipelines, but most will interview kids from any decent schools if you network hard enough -- Vista definitely gets the most school diversity though as they lean heavily on their CCAT cognitive assessment and care way more about what score you get than who you know or what school you went to. Would say roughly 1/2 of the 30 analysts that wind up at these funds are H/W and probably 1/2 qualify as diversity.

A lot of people think that these are the best jobs out of undergrad that exist on Wall Street -- I did too when I was interviewing for full time, but I learned a lot through the process and have some differing opinions now. The best advice I can give is to think deeply about the value proposition of the role you are accepting in comparison to your alternatives and what it means in context of your career goals. In simpler terms, most people do two years as an IB analyst, then two years as a PE associate, then they have a ton of choices: leave to bschool to try to break back into PE, or exit to a hedge fund, Corp Dev, or downstream sponsor. By starting out directly into a PE role and skipping banking, you are potentially shaving two years off of this path -- what does this mean to you? I know people that did it to get top hedge fund looks faster, or learn about a specific sector, or just had to be in an investing role and hated advisory -- all valid reasons, There were also people that took it for the "prestige" of being in a role that few people recieved -- they didn't consider the number of things you compromise by starting at some of these funds: Location (Bain Cap in Boston, Vista in Austin, Ares in West Coast), Pay (Blackstone, Vista, Bain Cap well below EB analyst comp), Sector Siloing (Vista and SilverLake are tech only), Unstructured analyst roles (KKR, and WP are newer programs without a fleshed out role or training for the analyst yet), Promotion delay (Blackstone and Vista are three year analyst programs), Having a large analyst class / network and more. Most importantly is the fact that you lose two years to figure out what you want to do post-pe if you're someone who isn't crystal clear on what that path is yet.

When it came down to my decision to choose what I wanted to do full time, I declined two megafund analyst offers to accept a return offer at the top banking group I had summered at (PJT RSSG / Goldman TMT / EVR M&A). Although uneducated freshman me would have called senior me an idiot for doing this, it made a ton of sense once I actually understood each of the programs and my own goals. I knew I wanted to do two years of PE, but had no idea what I wanted to do after that -- doing two years of banking first gave me more time to learn and figure that out. In addition, the banking offer was going to pay me a lot more and get me to the PE associate role in two years (one of my MF offers was a 3 year analyst program), and not silo me into a specific sector (the other offer was tech only fund). Being at a top banking group meant that I knew I would still get looks from all the same funds during on cycle, and my class wound up having no trouble getting great PE placement equal in caliber to the offers I had turned down. All in all, I'm in no rush because my career is gonna be 30+ years long -- I take no issue with spending an extra two years to add another solid brand name to resume and strengthen my skills in a known and commoditized training ground, but others may or may not feel the same. About a quarter of my banking analyst group turned down a pe analyst offer while pretty much every mf analyst I knew turned down a good IB offer, so ymmv.

TLDR: The kids going to MF PE out of undergrad aren't smarter/better than the kids in top banking groups -- they're just are more ready and willing to specialize and know what they want. Only take an investing role out of undergrad if you really vibe with that firm in particular (not just their brand name), or if the offer is much better than the average outcome from whatever banking group you could go to instead (not gonna tell you to take a generalist offer from Wells Fargo over KKR). Don't be one of those kids that just takes an Apollo Credit or Vista PE or Insight Growth Equity offer and is forced to go back to bschool because their career has hit a dead end in an asset class, location, or sector they don't even like.

  • Prospect in Other
Jul 15, 2020 - 1:04am

Thanks for such a thorough response, this is great, especially with the analyst numbers. It's probably not a decision I'll ever be lucky enough to make, but very interesting perspective on the PE analyst vs top IB analyst debate.

What do you think made you so successful in getting top IB and PE offers from a semi target? Were you diversity? Or was it just the usual of 3.9+, solid internships, networking, and great people skills?

Jul 15, 2020 - 2:04am

good answer. I'd agree with the sentiments of it framed in a 30 year perspective, but anyone who's in ANY industry 30 years is gonna be fucking balling regardless of where if you continue rising to the top. also agree there's a lot of logic behind 'just doing the 2 years of banking' because literally why not.

here's why the opposite decision makes sense:

1) you might not be working with the exact same banks you'd be working at as an analyst e.g. some boutiques, but you're working with bankers a lot and see exactly what they're doing because you're on the calls with them. as a sponsor you can see why they do what they do and even get MORE volume from an abstract perspective because the PE company is the one getting 50 pitches.

2) you're also working with ex bankers and stuff, and you don't actually need "hand holding" (not condescending, i just mean the structure and how people perceive it to be easy learning) like a banking analyst program. you just gotta be told and asked to do stuff, and you'll learn it. as long as people are understanding of inability early on (which they are), PE gives you a chance to learn way, WAY more varied and deep stuff about companies because you stick with them. Plus you get to do real things that matter, not BS (it's really clear when bankers are bs'ing certain assumptions and stuff even as an analyst on the diligence calls).

3) it all comes down to interest and 'not worrying about it'. I feel like someone with the 'confidence' to take a PE job and give up 'structure, knowing that you'll come out of it as x' is also willing to really dedicate themselves to getting where they want to. if I wanted to do a Corp dev job or MBA, or go to IB it's gonna be tough. But I know I will reorient my mentality, seriously dedicate, go balls to the wall and jump two feet in because I have to. Plus, at the end of two years I'm gonna have connections with everyone who's still at their bank right? and all the people at the PE firm with an MBA doesn't hurt.

some things that may be cons:

as far as models go, even when I first started I was doing pretty comprehensive models and setting and structuring things for people higher up to input and make assumptions etc. there's a ton analysts can do and it comes down to capacity always. however one thing I'd really stress is that the answers have to be right in PE and you filter deals first, which means preliminary financials aren't that tough while if you're an IB you know the company your pitching to take on as a client or are already representing a client so you can go full depth on the model from the get go. those reps might be better, but if the PE analyst program has modeling then you're gonna get a great experience too.

big, big one is who you're around. being in an analyst program you'll be with a lot of old people with kids and stuff. there honestly aren't that many people who I feel like I am friends with more than I am friendly with. but, there's a decent handful of the other juniors who I definitely am friends with. this part is huge though especially for Audax Bain etc in places like Boston. but at the same time, you work with banks and so many other people maybe even coinvesting. do it right and your network is 10000x better maybe?


bottom line though who cares haha, just make your decision how you want and whoever you are and whatever path you'll be fine. just do things that you want and feel, wherever that is because you've worked hard to set up opportunities that are great regardless. but also, people underrate the network and modeling experience you CAN have at a PE shop. I honestly think it's better, less learning how to use PPT and getting modeling down cold. But PE skill development is super underrated and in many spots it's actually better.

  • Analyst 1 in IB-M&A
Jul 15, 2020 - 9:48am

This dude really turned down two MF offers to go be a powerpoint monkey sell side analyst???? Lmao wild.

Jul 15, 2020 - 12:18pm

yeah, why even recruit in the first place if you're just gonna say no. Ego boost? Lol, but touching on what you're saying I'm not sure how much the busy boutiques, or being in a RX group for example are doing BS work because they already have the engagement and are doing deeper work? Idk can't comment.

But the simple fact that there is "zero" PPT work on PE side opens up way more to do everything else. There's other BS, diligence work but bankers do that also hahaha (data rooms, setting those up, managing, etc). So yeah PE analyst programs are actually underrated compared to banking TBH because people conflate "brand name" of GS/MS/etc. apply to other IB boutiques too. PE is getting more popular in the mainstream, you're probably never gonna be in a field other than finance so anyplace you go in the future will know what PE is more or less and treat it similarly to IB. So, there's actually a disconnect in reality with what poeple think about IB and PE. Thoughts? Would love for someone to check these assumptions because I've never worked in IB though I see everything the people who do work with us do more or less there are many functions in an IB that I don't.

  • Analyst 2 in IB - Gen
Jul 15, 2020 - 1:33pm

Sure and I don't regret it -- over my two years as an banking analyst, as compared to my roomate who worked as a MF analyst I got paid more, worked less hours in a better culture, got to dick around with my analyst class (many of whom are now some of my closest friends), and still landed a MF associate offer in on cycle. This is, of course, a reflection of the specific banking group and specific megafund the two of us were in, but most people don't realize that at the end of the day, there's more than enough undesirable work at any finance firm to go around. As an analyst, you get stuck with that shit -- doesn't matter if it's PE, or IB. Don't think that just because you work at an investment fund they're gonna let the 22 year old call the shots and let you make anything close to an important decision. If I hear one more intern give advice to another intern telling them some stupid shit about developing the "investor mindset" I think I'll throw up.

Jul 15, 2020 - 2:34pm

This is an excellent post. I made the opposite decision as you. Turned down a top 5 banking group for MF PE analyst. For those interested, look through my old comments on why MF PE analyst programs are phenomenal, but not for everybody.

My rationale:
* I was more interested in investing than advisory
* I was confident in my technical capabilities and operating under an environment with less structure
* I was interested in working at a hedge fund and knew the PE analysts placed very well in those roles
* I was open minded about non-NY geographies (my PE fund was not in NYC)

Analyst 2 in IB - Gen:

Most importantly is the fact that you lose two years to figure out what you want to do post-pe if you're someone who isn't crystal clear on what that path is yet.

This is where I disagree with you. A MF PE analyst has the opportunity to go out and try a new role after their 2 or 3 year stint, pre-MBA. Yes, your career may last 30 years, but it is very hard to pivot after your 3rd role in the industry. So if you do IB --> PE --> HF / VC, you will have a hard time going to business school or switching back to PE. This is especially relevant for HFs - taking that level of risk pre-MBA is valuable.

Many of these PE funds have promoted analysts through to VP on a faster timeline than their Ib->PE peers. BX, Silver Lake, KKR and Ares have all done this. Each PE analyst program is unique and there are pros and cons to each.

To answer OPs question. Only Whraton sends more than 20+ people to reputable buyside funds. Wharton is well represented at all of the analyst programs. Rest of targets send a handful max.

  • Analyst 2 in IB - Gen
Jul 15, 2020 - 3:08pm

Yeah sounds like you made a really well reasoned decision -- the best reason imo to take a pe analyst offer is if you know you want to do a hedge fund role after and I agree 100% that some of those analyst programs (Bx in particular) have a really unparalleled track record of placing kids at top HFs. Also sounds like you were at peace with some of the other considerations (geography, a little less structure, etc.). Great example of why someone would make the opposite choice that I did.

Jul 16, 2020 - 12:43pm

would you mind breaking down the differences between each of the MF analyst programs? What are the pros and cons of each? how do the experiences / roles and responsibilities differ amongst them?

  • Prospect in ER
Jul 15, 2020 - 12:11am

Rising junior at HYPW, literally know 2 in the last couple years, 1 KKR and 1 BX. Pretty ridiculous to think its close to common at all. Even then, not neccesarilly the best and brightest but obviously the focused and hard working people.

Jul 15, 2020 - 9:20am

Speaking on hiring numbers, my MF took about 75 FT FO analysts this year. Makeup was probably 80% target kids and over half of them were here over the summer.

"I'm talented in a bunch of different areas" -Kevin Durant
  • 1
  • Intern in PE - LBOs
Jul 15, 2020 - 9:40am

Most people at my target that are hardos in finance are in the mindset that they are going to go after the MF analyst positions but realistically know they will do 2 years in banking. People just want to limit the recruitment risk for PE on cycle and the possibility of getting stuck in the mind numbing field of banking

  • Intern in IB-M&A
Jul 15, 2020 - 9:58am

I think youre vastly understating how competitive the on cycle MF recruiting is. Just because you get an offer as a MF PE analyst doesnt mean you will be lucky enough to get an offer on cycle from IB. Too much luck/variables you cant control goes into it. If you win the golden ticket of getting to a MF out of undergrad, take it and dont look back

Jul 15, 2020 - 12:20pm

you're not the unpopular opinion. basically most people that say that though don't understand at all what experience you get in an analyst PE program (because it's new, so different firm-firm) because IB learning is so transparent. Trust me, PE programs are hella underrated. HELLA, because people simply just don't know enough about them to compare and it's easier to go with a known quantity, with a ton of upside, than an unknown quantity with the optics of actually being worse and at best slightly better. The reality is closer to "very equal and based on preference"

  • Analyst 2 in IB-M&A
Jul 15, 2020 - 10:00am

Realistically, this thread is just a bunch of people that got cut from the MF PE process and are trying to make each other feel better by praising IB lol

  • Intern in IB - Gen
Jul 16, 2020 - 1:20am

I recently turned down a PE offer (not MF, but a well respected name in Boston) for IB. Rationale being location, compensation, and I just did not feel ready to limit myself as a sophomore in college. IB still appears to open more doors than PE, and as someone who doesn't exactly know what to do post-IB, it seemed the safer option.

Jul 16, 2020 - 2:51am

not only are u anonymous when u make an account on this website, you are doubly anonymous and said nothing revealing. and you described the company so vaguely... why...????

assuming summit tho and not Audax or something

  • Intern in IB - Gen
Jul 16, 2020 - 11:31am

I just didn't feel the need to describe the firm more?

non-MF and located in Boston were primary factors in my decision and I didn't think other users would get that much more benefit out of me specifically naming the place.

  • Prospect in Other
Jul 16, 2020 - 11:58am

I would note that when we talk about full-time offers / junior summer offers that lead into full-time, your point doesn't 100% hold true (hence the debates above).

For internships experiences, doing banking > PE is true due to the amount of vaguely small PE analyst roles available to sophomores or less-than-ideal ones like Apollo's program where (in both cases) the interns aren't doing anything of substance. As a sophomore intern in banking (assuming BB here), you'll get a more structured and standardized experience, which you can better leverage later down the line.

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