Best Response

It is a "necessity" at some firms in order to climb the ladder. So you get thrown out to go get an MBA and fight against 15 other people with very similar backgrounds for one spot to come back.

They way I view it is that the industry is so rigid in some regard that you are required to get an MBA just to essentially say you have one. If you have two years of banking and two to three years of PE under your belt, what are you essentially going to learn from a financial and technical standpoint in class that you haven't done already on a deal? Granted other classes within the MBA may have use from a marketing and operational standpoint in PE. The strongest argument I feel is that you make connections with classmates within other industries and sectors which could pay dividends in the future from a deal perspective.

 

I think the usefulness of those other classes (i.e. marketing, operations, etc.) is heavily dependent on the practicality of your undergraduate coursework. I think investment professionals that were exposed to a very practical undergraduate business curricula where you take classes in Marketing, Operations, Management, Strategy, Finance, Supply Chain, etc., do not see MBA coursework as particularly beneficial.

Furthermore, my impression is that this is generally recognized in the investment world which is why Wharton undergrads can climb the rungs without having to get an MBA (this is based purely on my anecdotal experiences). This is in contrast with H/Y/P graduates whom went to schools where a practical undergraduate business curriculum was not offered. Junior investment professionals that went to significantly less "prestigious" universities often get MBA's for the "stamp-of-approval" rather than the usefulness of the coursework.

I went to a state school for undergrad and was exposed to (what I consider to be) a very practical business curriculum. Through friends and family, I've also had exposure to the assignments/exams that MBA business schools">M7 MBA students have to complete and I'd say they were very comparable to the work I did as an undergrad.

I can't argue against the breadth of connections you make via an MBA that may pay dividends in the future. However, I will say that I've worked with multiple investment bankers who are Stanford GSB and HBS alumns and categorically, they have attributed any successful deals they've originated to connections they made professionally rather than those from business school.

 

A lot of firms don't require it but if you are doing PE for the long haul I don't really see any reason that makes sense to skip it unless you end up some ridic situation (e.g. good friend of mine was hired as the first VP at a $1bn first time fund... he gave up his wharton deposit for that). I think the best move is to find a fund that brings you back post bschool so you don't have to worry about recruiting at all and can go build a network and enjoy your life for 2 years

 

Strongly second this point! If you have an offer to return - going to business school works better in the long haul I feel. 1) get more time to enjoy life and figure out what matters 2) try different things and get different experience (an associate from my fund went to start a super successful start-up during his time at Wharton..still came back for VP but eventually decided to do more entrepreneurial things) 3) build network outside of banking / finance...personally find it will be cool and can also be super helpful in terms of future deal sourcing

Also agree that more and more funds promote internally and don’t require MBA any more. (Seen someone made principal at silver lake after 4 years..)

 

Thanks. I was thought that was the case but was not certain because I have met people who say they were "forced out" and had to get an MBA; however figured that was a trend of the past. Obviously nothing is certain and some PE shops have different preference.

 

Hi ifried, just because I'm a bot doesn't mean I don't have feelings...I'm hoping these links are helpful. If not, feel free to throw monkey shit at me...

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If we're lucky, the following pros may have something to say: Citadel90 eroth Sterling Archer

I hope those threads give you a bit more insight.

I'm an AI bot trained on the most helpful WSO content across 17+ years.
 

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