Thoughts on Blackstone adjusting their recruiting process?

This article will probably do a better job explaining than me, but in summary, Blackstone is changing their recruitment process to increase the number of universities they are recruiting from. The article mentions they are especially trying to recruit from historically black colleges/universities to address the inequality in the hiring process.

What are everyone's thoughts on this? Do you think other megafunds will follow? How does this have an effect on people in IBD trying to go into PE? Will this actually help the inequality within these roles or is it just for PR?

Comments (64)

 
  • Intern in S&T - Equities
Jun 24, 2020 - 10:39am

Makes sense to me. Every good company having ivies and UMich just ensures other colleges can't earn prestige.

If more companies expand their target school list it will probably make undergrad institutions more competitive in the sense that ivies can't just rely on having good connections and being ivies anymore. The value of degrees from other (sometimes cheaper) colleges will increase as well. Feels like a win.

 
  • Intern in IB - Gen
Jun 24, 2020 - 6:23pm

You sound real salty you didn't get into one of the ivies

 
Jun 25, 2020 - 7:50pm

Intern in S&T - Equities:

Makes sense to me. Every good company having ivies and UMich just ensures other colleges can't earn prestige.

If more companies expand their target school list it will probably make undergrad institutions more competitive in the sense that ivies can't just rely on having good connections and being ivies anymore. The value of degrees from other (sometimes cheaper) colleges will increase as well. Feels like a win.

Older dude who graduated from a "target" school here. I cannot agree more with this sentiment. Hopefully it's not just a "change" for show as it often is in our industry.

I used to do Asia-Pacific PE (kind of like FoF). Now I do something else but happy to try and answer questions on that stuff.
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Jun 24, 2020 - 11:26am

My initial thought is that this makes total sense for Blackstone. Now they get to vet talent themselves from undergrad, hire at a much cheaper cost, and then determine who is actually worthy of becoming an associate instead of letting GS, MS and whoever else decide the top talent. Plus now they have talent that they can work 100+ hours a week for less than their overworked associates

 
  • Intern in IB - Gen
Jun 24, 2020 - 11:30am

Wouldn't it be hard for other PE firms to follow? Blackstone is the largest alternative asset manager in the world and has had an established analyst program for years and it will take time for other Megafunds to build out an analyst program. MFs are happy to take banking analysts mainly because they don't need to train them, and even the biggest MFs hire way fewer people than banks due annually.

 
  • Prospect in IB-M&A
Jun 24, 2020 - 12:04pm

Traditional targets, like Ivy+ schools and the top undergrad business schools, and then most likely the rest of the T20/30.

 
  • Prospect in 
Jun 24, 2020 - 12:20pm

I get the feeling that this isn't gonna matter for those of us who aren't non-Asian minorities or women though, since the article portrayed this move as a way to get better representation and more diversity within the firm.

 
Jun 24, 2020 - 12:42pm

I think this will have a large effect. If you read the article the other main reason they are doing this is that they are tired of recruiting people 2 years ahead with no track record. The article says they are only taking bankers on an ad-hoc basis and won't do on-cycle. Every PE fund hates the current recruiting set up so I would not be surprised if most of the major ones follow BX's footsteps. The reason on-cycle started earlier and earlier every year was because funds hate losing out on top talent. Don't see how this will be any different.

Diversity is big but current recruiting format had a major influence on the decision based on the article.

 
Jun 24, 2020 - 1:11pm

Yep, it just moves things even earlier so not sure it will solve the issue. However, they now have a larger pool of candidates, internships are essentially 10 week interviews and they can cut any analysts that they don't think are good enough.

Gives them more time to observe/interview talent and allows them to build a more diverse employee base.

 
  • Intern in IB-M&A
Jun 24, 2020 - 9:14pm

If you're going to hire someone three months after they graduate, why not just hire them yourself at that point? Right now, they are basically just blindly trusting the top banks to do their recruiting for them, so instead of fielding thousands of applications like they would through campus recruitment, they're just looking at the top few candidates from a few banks and basically assuming that GS/MS/PJT/etc are already picking out the cream of the crop. Under this proposed system, they can field a far greater amount of apps and be more selective if they want to focus on certain traits (ie diversity).

 
  • Prospect in IB-M&A
Jun 24, 2020 - 4:07pm

Why? Most of what positions they're referring to in the article aren't regular PE. BX has so many divisions that aren't impossible to get, such as secondaries which no one should want to work in but they get kids cause they're BX. Plus, unless you're Dell's son or that chick from Harvard that's top of her class and insane internships you weren't getting Blackstone PE out of college anyway.

 
  • Intern in IB-M&A
Jun 24, 2020 - 4:14pm

Because the article said they are sitting out on-cylce recruiting and will only hire on an as-needed basis... also the WSJ doesn't differentiate between PE and non-PE positions so not sure where you're getting that info

 
Most Helpful
Jun 25, 2020 - 1:29am

Please explain why nobody should want to work at Strategic Partners?

Is it because they get paid Bx money?

Is it because they just raised an $11.1 billion dollar fund (as did most of their secondaries peers), and manage 25bn+ across the platform as of 2020?

Is it because the MD that runs their division just made a $1 million dollar donation to Morehouse college right as the rest of the economy began free falling, not giving a fuck because he apparently has money to spare?

I always laugh when I see the way secondaries are discussed on this forum. Most people haven't even heard about this explosively growing niche within finance. But to the extent the WSO kids do know about it, they are more often than not self-important prospective lemmings like yourself, who have nothing of value to contribute other than shutting up and trying to be less useless for 10 weeks, and who will probably flunk out of their superday altogether (never to return) babbling about "nobody would want to work in secondaries", implying it's not "real" PE and therefore beneath them.

You literally know nothing, prospie. If i had to guess, you're the type of guy to accept a position in a third tier US coverage group of a foreign bank (if you're lucky) and come on this board stunting about "BB or bust". You're probably also the type of guy who leaves after your analyst stint for a junior seat at a downmarket, sub-bn AUM PE fund where you will never see an iota of carry but still beat your chest about "buy side strong side".

Or maybe I'm wrong (doubtful) and you're a 4.0 stud from Wharton about to start at an EB, in which case we will be sitting in the bullpen together soon and I have a news flash for you champ - the prestige game has seen its golden years already. Goldman is run by a DJ and dresses down on Friday. PE funds are now recruiting their talent from 50+ undergrad schools directly. It's not 2008 anymore. Life isn't an LSO blog post. It's not cool to be a douche, and the ones who engage the most in that game are ironically the ones at the MM banks your weird intern hierarchy denigrates so much.

What is most likely is that you are getting economically and professionally clowned on by people who work at the best secondaries shops - they are laughing at your inability to recognize what is actually experiencing secular growth in high finance because you're so blinkered from years of preftige posturing on WSO.

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  • Incoming Analyst in IB - Gen
Jun 24, 2020 - 5:12pm

If you are really passionate about investing and go to a target, you should check out the several funds that hire from UG. If you still want to do IB, there will still be many spots for on-cycle hiring as most firms dont have established analyst programs yet.

Im all for this move. It gives the top candidates a chance to start off their career in what theyre actually interested in

 
  • Intern in IB - Gen
Jun 24, 2020 - 8:52pm

Agreed. Most places don't have anything in place / the resources to build out a large on-campus recruiting pipeline. Only Blackstone has one right now (Warburg and Silver Lake have really small programs and hire a lot more associates, KKR just rolled out their program, and TPG / LGP discontinued their program years ago). If you're entering banking / SA now it should be fine in terms of recruiting, as on-cycle isn't just going away. Long-term I can definitely see changes, but what do I know

 
  • Associate 2 in PE - LBOs
Jun 29, 2020 - 1:48am

Interesting, I am generally more inclined to respond to target school kids or my alma mater (target as well). Maybe it is because we often have shared experiences or overlapping circles, but I tend to be more inclined to at least hop on the phone with them. Unfortunately not much I can do to really help since HHs do most of the heavy lifting

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