PE Lateral Recruiting Advice/Stories/Help?
Hi All, I've been reading the forum on this topic and feel like there isn't much on this. Apologies if repetitive in any way, think a dedicated thread could be really useful for those in a similar spot.
Little bit of background. UG senior at top target (HYPW) going full time to a UMM PE fund ($20bn AUM) located in a Tier 2 city. Junior summer did a BB internship at (GS/JPM/MS), but in a private funds group, with limited modeling and asset-level work. Didn't think staying would put me on the right career path, and decided to re-recruit in the fall to either M&A or an investment role, and ended up getting this gig.
For a variety of reasons (long term GF at a NYC hedge fund, personal ambitions) my goal is to end up at a UMM/MF PE firm based in NYC in the next 2-3 years. I took this job thinking that the direct investment experience at a junior level would translate to greater mobility in the PE industry compared to private placements, but the more I read threads on the topic, the more I am realizing that the only structured path to MF PE at the junior level is through the BB/EB pipeline.
Would love to hear, if any, perspectives or insight on the mobility of juniors in the PE space laterally/whether its possible to move around/strategies to do so. From reading the forum, I've gathered a couple paths I can take:
- A to A promotion at current fund, get MBA (exits from my fund are quite strong), recruit MF PE
- Reach out to HHs during on-cycle recruiting and try to get chats and interviews, try to push PE deal experience in interviews to get job
- Within first year, re-recruit to MBB or IB to get back to the traditional pipeline path.
- A to A promotion and ask for transfer to NYC office (not sure if possible but hoping this is an option)
Any thoughts would be hugely appreciated.
+1’d for interest, would love to hear from a few who have gone through a similar process
Subscribed.
Also interested. Same background/situation
Exact same situation and thoughts right now. Kind of worried I’ll get looked over during MF recruiting because a “PE Analyst” is such a new concept. Hopefully if I start networking early and hustle it’ll work out, but I can't help to think I should have taken a BB IBD offer I had on the table instead.
If I had to, I’d probably rank those options as 1 > 2 > 4. Toss out option 3, makes no sense to take a step back into banking / consulting, especially if you’re at a brand name PE firm (which sounds to be the case). Honestly wouldn’t take a risk with 4 in case they don’t have a spot in NYC and then don’t want to give a promote to you if they think you’ll be unhappy in the city you’re in. Tbh, chances are you’ll have broken up with your girlfriend by the time you’d be moving anyways
I don’t think #3 makes sense at all, especially given you are already working for a large fund, coming from a strong target and have a great BB brand name on your CV. Put differently, you would have to convince a strong IB that you want to LEAVE PE for IB (???), then you would have to go through the grueling recruiting process for PE and explain why you chose to leave PE to get less relevant deal experience when your long term goal was PE all along? I don’t see that story making sense to the people that would be interviewing you at each stage of this plan lol.
I think you may get mixed feedback on #2. My personal opinion: I think it’s very much worth reaching out to HH for on-cycle if NYC UMM/MF is your goal. I don’t see how you would be any less competitive than someone recruiting from traditional BB/EBIB. My buddies that were recruiting on-cycle for UMM/MF PE & HF, were all sneaking out of their fucking TRAINING to interview aka had essentially 0 analyst-level deal experience to speak to lol. On the other hand, there’s a good chance you’ve had or will have at least some exposure to how your fund sources deals, evaluates opportunities, spends time on diligence, etc. This is seriously invaluable experience and such phenomenal talking points during PE interviews. Plus, since you would essentially be recruiting for roles that wouldn’t start for 2 years, interviewers would likely trust that your technical/modeling skills would be up to snuff by the time the job began. #1 and #4 are things you can revisit if #2 doesn’t work. #1 is certainly the most “traditional” path of these options since most post-MBA PE roles at larger firms are filled by people with pre-MBA PE associate experience. That said, MAYBE it’s worth socializing #4 with a few people you trust when the time comes. Then, if you feel there is pushback/uncertainty, just focus on #1. Honestly though, I view #4 as having more downside risk than it’s worth.
Lastly, I just want to say you are in a GREAT position and have more leverage than I think you are aware of. Although the “analyst” title is a relatively new concept in private equity, when I think of the PE analyst role, I immediately think of funds like silver lake and kkr who are some of the few large players that (famously) hire analysts out of undergrad. These are coveted positions and terribly competitive. These young professionals, like you, are able to skip the IB stint + painful on cycle PE process and break into your long term goal industry. There are so many kids out there that would kill to be in your shoes. I, and I’m sure many other PE professionals here, would be more impressed (all else equal) with the individual that was able to jump straight into PE out of undergrad. Just keep this in mind moving forward if you begin to doubt yourself.
Good luck, stay humble and always focus on the big picture
why’s moving to other office so blasphemous (for lack of better term). ik that mbb’s are happy to do this in order to keep people in the firm but why so hush hush w PE firms?
I think it's very firm & group-dependent and a lot depends on a person's reason for relocating. I've seen it go both ways. For instance, during my UG, there were kids who accepted IB positions at solid firms that were in less-than-desirable locations for them, because they wanted to break into IB. Then a few months in asked to be relocated to NYC lmfao. From the firm's perspective, they had a hiring need/capacity issue and hired these individuals because the prospect had indicated they were committed to the group but in reality just wanted to be in NYC with their buddies. If the person relocates, then the firm suddenly has a hiring need again which is expensive and time-consuming; if they don't help them relocate then they're stuck with someone they know is looking to leave. Pretty uncomfortable situation. That said, I think OP has a much more palatable story given he would be willing to stay with the firm, will have been with the firm for a couple years, and is wanting to relocate for personal/relationship reasons
how would you think about recruiting on cycle vs off cycle? would it look bad recruiting immediately upon joining the current fund? Also how would an mba view staying four years at the same fund then applying vs changing firms after two years. would they prefer one to the other? does one look better?
As long as you have your story straight, I don't see a problem going the on-cycle route. In other words, I don't foresee HH/PE funds questioning your loyalty by recruiting this early. On-cycle recruiting occurs very early, everyone can appreciate and understand this. Many people are taking jobs out of undergrad solely to position themselves for on-cycle recruiting into private equity - your position out of UG just happens to be in PE already which is great. Furthermore, IB/PE are incredibly high-churn industries. People are coming and going between IB/PE firms (and exiting these industries completely) frequently during the course of the several years that follow UG. Unless you are the person that is bouncing between places every 6-12 months looking for a better opportunity, I doubt anyone is going to really question your character/loyalty at this stage in your career. That said, one last thing immediately comes to mind for you - I would anticipate people asking what A2A looks like at your firm, and if there are solid opportunities for you to move up as an associate (eg does your firm have a strong track record of promoting internally). If yes, people are going to then ask why not stay at XYZ fund where you are already ingrained in their process, have established social capital, can avoid the recruiting process, etc. I can't answer this question for you but if you came to me and said you have a tremendous amount of respect and appreciation for your existing employer, saw it as a unique opportunity to break into PE early on (which is rare), and gain great buy-side deal experience, but want to be in NYC long-term to be closer to friends, family, S/O, etc., I'd buy it.
Re MBA, I very highly doubt someone would view this negatively (4 years at XYZ fund > MBA > ABC fund) or really have a preference either way. Not to state the obvious, but part of the reason people get their MBA is to have an opportunity to recruit for new firms, geographies, industries, etc. Paging APAE who always provides thoughtful comments, esp regarding MBA
It sounds like you are at a reputable PE shop. Assuming you are doing legitimate deal work (dataroom analytics, evaluation of investment thesis and risks, modeling etc), you will have no problem securing PE associate interviews in NY.
You can participate in on cycle your first year or you can wait a year until you have more experience. Your strategy may depend on how well the headhunters know your firm's analyst program, and how confident you are in your next move. Audax and Ares are firms similar to what you have described, and analysts at both firms have made this move.
If you want to be in NY, there is no reason to delay until post-MBA or make a step back into banking. The recruiters look very fondly to PE analyst programs.
(not OP) I'm a first year analyst at an investment firm that specializes in something "niche" but an industry I want to stay in. My firm is not widely known but is definitely competitive within the this niche. Because of this specialization I waited to get transaction experience I could discuss prior to recruiting and am now starting to reach out to HH about off-cycle. However, given various factors (Covid, it taking a really long time to close transactions, etc) most of my modeling and the deliverables I was solely responsible for has been focused on earlier-stage stuff, though I have helped out on qualitative DD (covenants analysis, digesting consultant reports, starting to learn what to look for in documentation) for deals we had exclusivity on. I feel I have a pretty good grasp of how to evaluate an investment and how to build models for my industry and of course will be practicing in preparation for interviews.
Do you have any recommendations of skills to focus on or how best to present my experience for associate recruiting?
Hat tip to whoever tagged me. People have already hit the main points worth noting.
Over the latter portion of this past decade the analyst position has gotten a lot more common among sizable and respected firms. This means that there's now significant enough critical mass of people who have been through those programs and progressed further into their career. Some stay and accept the promote, others have gone elsewhere for their associate stint. There's also critical mass of people from both of those camps who have attended business school. From what I've seen, it's much more common to go to a different firm after the MBA.
In terms of your framework, I would blend #1 and #4. It's straightforward. If you're doing the job well, you can keep your hands firmly on the levers that feel familiar to you and find yourself with the very job that the people who got into absurdly competitive banking groups are crushing themselves to break into. You can also avoid the migraine of recruiting during b-school.
If you stay at the firm four years, you're going to have a wealth of relationships to draw on for recommendations for your MBA application. If you choose to go the MBA route, the risk you run is that your firm wonders why they invested in you so heavily only for you to want to leave.
You can ameliorate this by pointing out that you've got a meaningful relationship that presents familial or personal reasons for a geographic change, and you'd also welcome the opportunity to ease back a bit ... that school lets you get a breather, develop your network, gain some new perspective, maybe get an internship in an industry role that can help enhance your mental framework as an investor, and all in all come back a much more valuable employee for the firm.
Firms like this are small enough that 'standard policy' isn't baked so heavily in stone that it's inflexible. If they really love you, you really love them, and it's a mutual match, it's a natural conversation about sponsoring your MBA. Even if it isn't a full ride, something like $100k can completely change the financial profile of the decision.
This is also the perfect way to switch geographies. It allows you to preserve the social capital you've accrued over three years (at the time you begin asking about school), which you would probably erode if you asked at the 18-month mark when they discuss your associate promotion with you. One of the anonymous users above highlighted this well. You've got to live and breathe the story that you love it there, you just want to sit in a different city for personal reasons.
The only downside of this path is that you're in a long-distance relationship for an extended period of time. If you wanted to recruit so you could change sooner, I don't blame you. My recommendation is that you either commit to the associate promote path and b-school as the catalyst for a geography change or change locations by changing firms. Trying to do it within your firm without using school could blow things up.
In terms of how to maximize recruiting while already on the buy-side, I made a quick comment a few weeks back in another thread. Here's the relevant portion:
Personally, I don't know that I'd recruit as a first-year. There are enough slots at great shops (megafunds included) available for same-year start that you could safely go as a new second-year and not worry about not being able to find a job to start in June. Some of the big funds have even begun intentionally reserving a couple spots in each class for second or third-year analysts who choose to recruit later. This means you could recruit in the fall of your second year (right after your one-year anniversary) and still get a start date for the coming year.Good luck.
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