Q&A: Private Equity Associate, started after my undergraduate
Bit of a slow Friday, but have to wait in the office for a bit. Happy to answer any questions about my job - currently an associate after a recent promotion from analyst. Created this throwaway account, happy to answer anything.
Thanks for doing this!
No worries. Was caught up in something for a bit but fre now.
Very helpful! Does your specific shop have a credit arm as well? I’m aware that many of the MF PE shops are attempting to diversify into credit. Also who are the lenders your MF typically works with?
Thanks for doing this!
How has the transition been from analyst to associate? Specifically in regards to having greater technical demands since you didn't have many technical duties as an analyst.
Thanks for spending some time doing this. I'm most interested in how you got the original offer in PE out of undergrad.
Won't say too much about my background beyond - top target undergrad, graduated with honors. Summer at a mid-tier BB in a solid, but probably not one of the most well-known, group. So PE out of undergrad is not a very structured recruiting process at most places, except at a couple firms (BX comes to mind, as does Silver Lake and Vista). Additionally, few places even take undergrads. I was lucky enough to have a couple people I know at firms that recruit from undergrad, and they put me in touch. Had an interview towards the end of my junior summer, then received an offer to join out of undergrad. They aren't really looking for technical skills, more looking for your mindset as an investor and your personality/cultural fit. PE firms aren't that large, so it really is possible to have a firm-wide culture
Does your specific firm require you to go back to business school, and if not do you have any intentions to do so?
Some people can be "required to leave" for business school. They don't really push you out in the sense that they explicitly tell you to leave, but they do say that further advancement isn't possible. You have some flexibility; the firm is open to giving you some extra time to figure out your next step. There is some possibility you can stay if you are a top associate - they are definitely open to promoting from within.
I have received positive feedback and I believe that when the time comes, I will be in a good position for staying for a post-MBA role without one. That being said, I was accepted in college to a deferred admissions program, and may attend. Haven't decided yet
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Sure. Applied my senior spring of college, took the GMAT, got letters of recommendation from a Professor and my old boss, wrote the application essays. Honestly not sure what they are looking for, but I had a strong undergrad, strong GPA, very good GMAT, and I think my letters were solid. Additionally, my work experience (especially at the time) was definitely unique compared to the average banker who's applying. Pretty sure they take mostly good schools this round, kids that are studs. The more interesting experience candidates tend to after work experience
Do you happen to know anything about PE analyst programmes in the UK and how the process compares to the US?
Generally, PE recruiting outside of the US is less structured, ie. they don't require IB, first-year analysts. In the UK, pretty sure there are a number of firms that recruit out of undergrad. Can't really comment since I don't know too much about the scene there
What was an estimate of your undergraduate GPA?
Graduated with high honors. Definitely not a 4.0 though
Hey thanks for doing this - how do your work hours compare to that of a Top EB/BB analyst/associate hours? Also, as an associate at a MF are you typically working with specific people and/or teams (other analysts/assoc/principals) like how IB has deal-teams?
Hours are not that different, but less weekend work and more variable hours. If we are finishing up a big investment then the hours are equal to, if not worse than, the worst banking days. But the average day is definitely a bit better and I normally don't work Sundays. Depends on the deal. For the biggest deals, we have a full team - analyst, associate, principal etc. Sometimes more than 1 of each for a couple. Smaller deals can have just a single associate on it, and a senior guy who is more of the relationship manager. As an analyst though, especially a first-year, you're more there to learn and help out on anything that the associate/second-year can't necessarily do or doesn't want to do. You do definitely participate in modeling
Just want to add that I have gotten a lot of PMs. Happy to answer but will take a while to respond to all of them
Are there any common characteristics for those that get invited to interview at your firm at the associate level that do not get offers extended to them? (excluding errors on modeling test)
Any advice on how to practice coming off more polished/articulate? I feel strong on technicals and have a solid background, but realized that I need to become more proficient in articulating my thoughts/ideas/answers concisely and professionally.
I hope to be interviewing for associate positions in the first recruiting cycle coming from a BB.
Honestly, the process is pretty brutal before getting to me (I just participated in firm-wide recruiting this past year). You have to get past headhunters and initial screenings before getting in front of us, so we don't really have that many candidates. Personally, I don't think technicals or even your why PE answer matters too much (unless you have a bad answer, it can only hurt you). What's more important is fit - can you see this person as someone who can eventually make it to a senior position, and would you be ok spending 12 hours stranded at an airport with this guy - basically, is he competent, cool enough to get along with, and able to bring in business
How does recruiting work if you want to move to another PE fund after two years?
Headhunters reach out to us, but we have to be a bit more proactive and have a good story for leaving, not as easy as sitting back and receiving emails
As I sit here preparing my umpteenth sell-side pitch, I've always wondered how buyside shops select their sell-side bankers. How does your shop weigh the following characteristics when hiring an advisor?
a) firm name brand b) personal relationship with banker c) relevant deal credentials d) performance in pitch
Honestly, I don't make the call, but what I can say is: 1. We don't care that much about the brand. Really isn't that important 2. Strong personal relationship definitely matters 3. Cheap leverage and special perks are always a bonus. Good industry relationships are also important 4. Almost never actually matters unless you guys mess up something. I don't care about your font or presentation style
Great thread, quick question from me. What is the B4 presence like at your firm (if any), and what are your thoughts for changing B4 early to move into boutique corporate finance? Unsure as to whether the skillset I currently am getting will be attractive to PE, despite numerous roles I see advertised asking for ACA qualified TS experience (UK London).
Thanks
Among the investments associates and analysts, unfortunately, no one I know has worked in accounting. If you're asking about their consulting practice, I think there might be a more senior person who originally (way back when) worked at like Deloitte consulting or something. The skillset is pretty relevant, but mostly at a lower, modeling level. When they hire analysts/associates they are looking for potential future partners, which has almost nothing to do with skillset - people tend to not think about this when recruiting. It is why if people are dead-set on PE, and still want to do banking first, I encourage them to go for PE full-time - thinking like an investor is more important than technical skills.
I appreciate this response, how does one demonstrate they think like an investor though? Managing your own portfolio, or more about the way you think and come across in an interview.. It's an inevitable requirement nevertheless. Would you recommend doing a MSc, rather than trying to lateral after B4 3 years?
How many associates or analysts at your firm have MBB backgrounds?
There are a couple, but most still have relevant finance experience (one that comes to mind is someone who did an SA stint in banking, then fulltime at an MBB in their PE practice). I wouldn't say we hire one every year, but every year there are a couple who make it to the final rounds of interviews and are generally impressive, but operating roles are definitely more suited to consultants in general
How many of your associates are lateral analyst hires from LMM or MM PE firms? Would that be a possible transition to make? Or would business school be required?
None that I know of, unfortunately. I think there is a more senior guy who lateraled in from a top UMM firm, but that's really it. B-School is definitely the move, and an LMM firm won't impress anyone here (not to look down on them, it is just that it is really different to look at a 5 billion deal vs. 10 mil). Maybe if you're coming from a really solid MM or an UMM firm and you impress during networking you can definitely get a shot after B-School
Thanks! B-school is my plan right now. I really do like working in growth equity so far, so maybe I would have better chance at moving to a UMM/MF on their growth equity team.
To all who sent me a PM: I will eventually get back to you but might take a bit. I am happy to answer more specific questions about yourself that you don't feel comfortable sharing publicly, but I do think some of the questions being asked are better posed on this forum
How do you think interviews compare when coming out of undergrad vs. 2 years of banking? How did you prepare?
Banking ones are a lot more rapid-fire - they take place super quickly. Modeling, behavioral, and a dinner/meal. My process they were able to take more time to evaluate me, and they didn't ask me to model. I didn't really prep beyond learning some of their recent deals and refining my "why PE" and "how do you think about investing"
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