Private Equity Interviews tomorrow
I got a last minute private equity interview and I was wondering what kind of questions typically come up in these private equity interviews. Are they more technical or fit related?
Any insight would be appreciated.
Congrats!
Can't offer too much help, but good luck, hope it goes well. I've heard PE interviews are generally more fit, but it depends on the fund. Smaller funds will basically be all fit, but bigger funds will be more technical.
it depends. what company?
I would rather not say about the name of the company but they are very small.
Thank you for your comments and if anyone has anything else to say, please let me know.
what's the AUM, primarily a buyout fund ?
In my interviews with PE firms they have usually included a case interview. But it depends on the firm.
NEVER lose your BlackBerry www.conveniencesoftware.com
use the search function -- there's been a lot written about this in the past. whether your interview is "last minute" or you had two weeks to prepare, it would behoove you to look at the archives of this forum. if you really cared about this interview, you would have done all this preparation already.
to answer your question bluntly, you can expect both technical and fit questions.
how did it go
The world has changed. And we must change with it.
know how to model in your head
Undergrad PE interview (Originally Posted: 01/11/2016)
I have an interview at a PE firm on Friday for a summer position and wanted any guidance regarding preparation for technical questions. Is the best course of action going through an lbo model on macabacus? For reference, I've prepared for accounting/valuation questions in the past.
Thanks.
Speaking from a friends experience who interviewed at a 5bn aim firm. 1. Initial rounds focus on behavioral 2. Technical questions were limited to basic banking questions (although if you have anything finance on resume, I'd say LBO walk thru or case study in an discussion sense also is reasonable) 3. One interview was just on brain teasers. 4. Afterwards,had to complete an online test
I interviewed for a long-term internship with a large European PE fund, and process was pretty standard:
Macabacus is definitely a fantastic source, and if you can understand the LBO on Macabus, then you should be set for any technical questions. Also make sure you know how to do a paper LBO
Super quick PE interview preparation (Originally Posted: 03/24/2015)
Hi guys, any tips for a super quick PE interview preparation when it is my first pe interview ever? Thanks!
You should really utilize the search function.
If you have very limited time: http://www.streetofwalls.com/articles/private-equity/
Thank you!!
Interview Questions PE (Originally Posted: 08/02/2009)
Hi! I've got a 1st round private equity telephone interview at a big fund coming up. Got relevant internships (no FT exp) in MM PE and BB M&A, what can I expect? Very technical, deal experience or more fit questions for 1st round?
Thanks!
up
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PE Interview - MM PE Fund (Originally Posted: 08/24/2011)
Just got a call securing my interview for next week with a Middle Market PE Fund in MN. I was wondering if anyone had any tips on the interview process/questions. I've interviewed with boutique and middle market IBs before but never PE, so i don't really know what to expect. Thanks much.
Expect run of the mill fit / behavior stuff.... Tell me about yourself, what do u do at X company, how did u end up at x school, y company
Typical technicals, maybe some irr calcs, technicals and industry stuff related to ur experience and resume, deal specific stuff
More qualitative stuff, was x deal u worked on a good investment, why or why not... How would u think about x company in y industry, how much leverage would you put on it, what would drive returns, etc...
I feel one of the main things they'd want to know is why you want to be in mn. This is one of the biggest concerns for them most likely. Have a very good answer, if you're not from the area and don't have an answer make something up.
interview - PE interview (Originally Posted: 08/20/2010)
I'm still in school, graduating in 2011 but it is likely that I'll go through PE interview process for an internship. It's an invesment job so I know I can expect questions like: "What company would you invest in?". I don't have experience in this field so I would not know how to handle this perfectly. Can some exoerienced people explain the basics of this? Some methodology to detect, follow and present our personal choice to the interviewer? How long should it be, what should be emphasized? thanks.
Europe / US?
Europe!
That's what I expected. Having details of where (London/Paris/Frankfurt?) and in which type of fund would help.
Feel free to PM
invest in bp good long term potential after they lawsuits
Buy a Vault Guide book, do some research, then come back and ask more targeted questions, and you will actually get useful responses.
Nobody can really answer your questions, other than saying "study your ass off" with this lack of detail.
PE interview questions (Originally Posted: 03/23/2007)
I have an interview with a mega PE fund coming up and I was hoping to get some help from people who have been through the PE interview process as to what to expect regarding the questions that are usually asked. Can you post some samples?
Thanks!
Anyone??
I just did a 1st round RE PE interview at a Tier-1 shop, going back in for 2nd round this week, but I'm not sure if the questions would be remotely applicable between RE and Buyout.
Sorry to get off your topic MandA, but would you mind posting a couple of questions from your RE PE interview? I have one next week and I'm not quite sure what to expect (no formal RE experience). Any help would be greatly appreciated.
I second SPC777's question. I will be pursuing RE PE after school and I would love to know what they threw at you.
Interviewing for PE firms (Originally Posted: 08/20/2006)
I am trying to transition out of my boutique investment bank towards private equity (mid-tier most likely, top-tier if possible, but probably not). Has anyone had experience that they would want to share on what kind of questions are asked, and what you need to prepare for the interview?
I have heard they are quite intense, and will grill you on aspects of LBO modeling, accounting and your own deals.
Thanks!
some may conduct many rounds of interviews, ask you to meet all partners (even if that numbers in the double digits), give you modeling tasks in real time, ask technical questions
others will be totally soft, almost philosophical. ask you why you wanna be an investor, what do you think psychological diff between banking and PE is, throw you a business and ask you for an opinion on it, ask you what business/industry/recent deals you like and why etc.
at some firms you have earlier rounds with lower level folks, and these tend to be more technical. Partner level interview I had were non-technical
bottom line, it varies, and depends mostly on the partners whim.
you need to prepare by knowing your deals and resume, talk to as many PE folks as possible beforehand, know what is going on in the market, etc. And cram a little on the technical stuff if it's not part of your daily work and you feel uncertain about it.
PE Interviews (Originally Posted: 12/31/2013)
Hi all,
I was going through several basic PE guides and am currently mulling over "how to think like an investor"...
Mostly directed at PE professionals here: How do you go about thinking through questions like "Is this a good investment?" or "Would you invest in this company?" or "What makes a good investment?", etc?
I know the generic answers of what makes a good investment such as strong and predictable cash flow, low capex requirements, etc. but if given a company, how do you go about thinking whether a certain investment is worthwhile? I understand there is no template to abide by, but I'm assuming there are certain questions a PE investor asks oneself when evaluating an investment opportunity.
Additionally, does anyone know if there's a sample investment memo (maybe something a candidate put together for a case study) floating around on the Internet, or is willing to share their own?
Thanks.
I think that's a very good question as this is probably the most important idea to get across when interviewing with funds.
In essence, you can divide the thought process into three steps IMO (for interviewing purposes):
This should give you a pretty good big picture idea about whether this company would make for a good investment (given the info you get/got).
Sometimes interviewers also want you to solve this question by doing an LBO on paper, and seeing if you can get a decent rate of return using the numbers they give you.
I have not heard of any info memos floating around.
Thanks Matrick. Anyone else?
I found Porters 5 forces to be an excellent paradigm to use in these scenario. Other things to keep in mind when answering these questions:
Last but not least, interviewers tend to be: (a) too optimistic, because the deal was socialized to them in a banking environment where the overly optimistic highlights are lauded and risks are swept under the rug; so be critical and contrarian; (b) too abstract/theoretical; at the end of the day you're giving someone a bunch of money so you can own their business, don't forget that, take your thinking and apply it to the real world.
PE interview set up next week, pointers please? (Originally Posted: 10/07/2013)
I got a BB IBD for the summer internship, fairly good GPA, and decent connections with the firm. I've never interviewed for PE before, but I know my IBD technicals forwards & backwards as well as most of the behaviorals. Instead of spitting out a bunch of random questions, i'll just ask one fairly broad question: what are some main differences between an IBD and PE first round interview? in terms of where they're focused, types of questions, etc.
The main differences will lie in trying to see if you can think like an investor as opposed to just regurgitating answers you memorized from a technical guide. In banking, most interviewers will know that you don't have a ton of experience but if you have taken time to prep and understand the basics it signals to them that you are interested enough to do your homework and as long as you have a good attitude they can work with that to fill in gaps. With PE, they want people who know the technicals and how to apply them. You still don't need to know every single thing, but the bar is a bit higher. They might ask you questions that seem a bit different from what you would get in a banking interview. They are more focused on the "why?" than the "how?" You might mention deal metrics and they might respond wondering why the margins are the way they are, what is driving the trend? Are margins strengthening because revenue growth is outpacing COGS or is revenue relatively flat but they are improving margins through cost reduction? How easily can the company service debt, etc.
You may not get all of these types of questions in an introductory interview, especially if you haven't done 2 years in banking, but these are some of the subtleties in how PE interviews differ from banking interviews.
first off, thanks for the reply, a lot of good input in there. since I have no banking experience besides my internship, how in depth should I study? I have until this upcoming tuesday, so that leaves me quite a window to knock some books out/study up on technicals to hopefully get second rounded for this firm. any recommendations on techniques to study or books to read? thanks in advance.
I would focus on understanding the mechanics of an LBO, what characteristics make a company a good LBO target, and having a solid understanding of basic accounting and cash flow models. They won't expect you to have a lot of deal experience given that you've only done an internship in banking, but being well prepared for those types of questions (i.e. paper LBO / cash on cash return math, etc.) will go a long way.
Prepping for PE Phone Interview (Originally Posted: 03/30/2011)
Hey guys ,I know this question has been asked a few times on here so forgive me for asking it again, but for someone with less than a year IB experience, I think my situation is a little different.
I've been working at a Small L/S HF for the past couple of years and am now looking to transition to a role in PE/VC. I have a short 20-30min phone interview with a PE firm scheduled this week and I need to cram as much information as I can prior to it.
Any advice on how best to prepare give the short time span and my relatively unrelated experience ?
You say Vc/pe - do u mean growth equity? Buyout? Vc?
Vastly different prep as you know
PM me with any questions, i work for a PE fund and we also have some VC stuff.
Its a small PE fund that invests in companies via preferred equity, mezz loans etc. I don't have specific questions yet, just looking for general advice on how to prepare in such a short time span for someone coming from a non-IB/transaction-oriented background.
if you've done earnings forecasts and modeling at your HF, i think you should have the basics covered, esp. since the PE fund isn't pure buyout i'd be less concerned with LBO modeling and more focused on talking about what you're strongest at: fundamental analysis.
more spec., i'd be prepared to talk about how your L/S equity experience has uniquely prepared you for a role in PE. it'd be gold if you covered the same sectors and verticals the PE shop looks at -- then you could talk about an industry in detail: what the drivers are, risks, key players, barriers to entry, etc. if you were involved in idea generation at the HF, you could talk about how your time there taught you how to craft investment theses and identify value in an industry. talk about company fundamentals. the key thing will be to intelligently dissect and analyze industries and companies within those industries.
the challenge i presume will be thinking about the risk/reward of investing up and down the cap structure and NOT just accumulating positions in common, so be able to think about how the return profile might differ when investing in common versus pref equity, mezz loans, hybrids, etc. the other key difference is being able to discuss investment timing (HF being relatively "quick" money, PE generally more long-term approach to capital)
All of that and then also talk about how you are very interested in the governance aspects of the job, supporting partners acting as directors on portfolio companies' boards, and supporting the identification and execution of portfolio companies' organic and inorganic growth catalysts-- these operational aspects are unique and you aren't getting those now unless you are @ an activist shop but even then you aren't as close. I know you're trying to be stealthy but its v unclear wt these guys do...If they do mezz and preferred vis-a-vis late stage/mature then are they a mezz-ish shop? If so scour the board there's been a bunch of hy/mezz modeling questions. If they acquire pref shares in the context of early stage then understand typical early stage pref structures, things like liq prefs, cap table modeling/dilution/anti-dilution protection, the seniority of prefs in liquidity events..
Thanks a lot guys for the advice, i really appreciate it
Why do you want to leave your HF?
^Would also like to know, if you don't mind disclosing.
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