PE Analyst Programs
As becoming a MF pe analyst out of undergrad is becoming more common across funds. I was wondering, what is the difference in daily responsibilities for a PE analyst out of undergrad and an ib analyst? I get a PE associate, but coming in without experience and as an analyst what is your role like? Also, can you exit from pe analyst to business school? And would these programs maker it easier to exit to a HF than traditional ib programs?
Bump
Largely dependent on the PE Analyst program, MF PE Analyst programs exit well into b-school and are better to transition to HF. The tasks are generally the same in IB and PE at the Analyst level: powerpoint, memos, modeling, admin work, etc. The big difference is that in PE, you are in an investing role.
Keep in mind that exits and experience can be different at some Growth Equity shops as well as smaller PE funds.
Would you say PE analysts see less transactions, or is that a myth? I have heard IB analysts see way more transactions and learn to model basically anything.
Your exposure to transactions and modeling depends on the group for IB. If you're in a group with very strong deal flow that runs the model in-house, then yes, you will probably get a greater quantity of live deal exposure. However, there are plenty of groups that are do nothing but pitches or outsource their modeling.
PE Analysts would close fewer deals on average because of the nature of the business, many PE firms only make a handful of investments per year. You could go through your analyst/associate years without closing a single deal. Don't confuse being on live deals with modeling experience tho. PE's get tons of deal flow in their pipeline, which will provide lots of opportunities to improve those skills.
Recruit for both PE and IB and take the best offer you get. Most people aren't in a position to pick between different firms, especially with the staggered recruiting process. Generally, in my opinion, MF PE > BB/EB & UMM PE > MM PE > MM/boutique IB.
So as some body who tends to higher quantity transactions/less detail, would it be smart to take a group with strong deal flow over pe, with the long term goal of HF, or would this be stupid?
If it is a top group with high deal flow ,would you still go to the MF?
The blind leading the blind
I'm a former PE Analyst, and if I were to do it again I wouldn't trade for banking. You'll generally be doing much of the same work and able to develop a lot of the same core skills (modeling, presentation creation) as bankers, but typically don't do as much BS process work as banking analysts (managing data rooms, co-ordinating diligence requests, setting up meetings, etc). I think there is a definite advantage to coming from PE in terms of HF recruiting because you've spent two years of your PE program in an investor role and have a much better sense for investor thesis / considerations, diligence process, etc.
To the point above, I wouldn't worry about quantity / quality of transactions being an issue for a PE analyst or developing modeling skills. You'll get sufficient volume of real and live deal experience and transaction complexity as a PE analyst even if you actually close very few deals.
Really interesting. Now, if you were given the chance to start as ur find out of ug, would you have done that? I know many funds don’t have large analyst classes or very organized training like banks or new pe programs, but there are students getting Hf roles, and I’m wondering what you think of just tryi to join a Hf right off the bat?
My personal take is HF out of UG is not an option for the vast majority of funds (there are a few exceptions obviously). HFs tend to run pretty lean on the investment side and it's honestly significantly more of a hassle to try and train up someone from UG on accounting, financial theory, modeling, etc vs. just taking from a banking / PE analyst program. If you really want to go to HF I think the best bet is starting as a PE analyst because the HF opportunity set for you is miles better, not to mention you have some time to get a sense for what you like / don't like about investing, so you can better orient towards the type of fund you'd actually be interested in. I've definitely seen banking analysts from top EBs / BBs go to HFs as well, but my sense is that it's a more regular path going from PE analyst -> HF
Do head hunters approach you for Hf positions if at a pe? If I am primarily interested in going into a HF in the long term, would it be smarter to network hard to recruit for pe, or just go for IB, which is still obviously challenging, but much less than pe
You'll definitely get looks from HHs if you're at MF / UMM PE (I did MF PE as an analyst and had no issues with HH inbounds). If your goal is HF, then I'd probably give the edge to PE vs. Banking at the analyst level. A lot of HFs aren't explicitly hiring from analyst-level (unlike PE Asso programs), so there's folks that are like 2-4 years post-undergrad all competing in the same pool for roles. That being the case I'd give the edge to doing PE at analyst level because you've got a more unique and relevant skill-set for HF than a banking analyst
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