Tips for becoming a Private Equity Analyst!!!!!!

I am located in Dallas Texas and am very avid in looking for Private Equity internships. I am fairly new to private equity and want to understand more about the field as well as break into it. I have an internship and a few stock competitions on my resume but am looking to intern at smaller banks in my area due to lack of experience. I have networked with a lot of alumni in Private Equity and they have been super helpful and many recommended me here.

What should I be focused on learning and understanding first to truly nail an interview once I get one? I am currently enrolled in the WSO Elite Modeling Package and plan to purchase the Private Equity Interview Guide as well. What material is crucial to know first and build on? I feel clustered because I have 100 tabs open on my laptop with information to learn, yet I don't know where to start or build on. Should I start with accounting, LBOs, Modeling, Excel,

If anyone could help me or even give me their personal experience from when they started out that would be GREATLY appreciated. I would love to know everything I need to about Private Equity and break-in. I am committed and will break into Private Equity. I just need to know how to start in such a big industry and understand the stepping stones.

Thank you so much for reading and ANY feedback would be appreciated

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Comments (19)

Jul 22, 2020 - 8:30pm

I am a junior at UT Dallas.
Yes I have reached out to alumni and a few upperclassmen

Joshua Gillest
Jul 22, 2020 - 9:15pm

I'm a junior currently working at a private equity firm. I got my internship by cold emailing firms and setting up introductory calls with the few funds that responded. The only "interview" questions they asked me were pretty high level about what private equity is, why I want to get into PE, and what PE investors look for in a company. There were also a few case studies to complete. No one asked me if I knew how to model an LBO or anything like that because that kind of stuff is pretty easy to teach. That being said, knowing how to model an LBO and work efficiently in excel certainly doesn't hurt. Hope this helps.

Jul 23, 2020 - 12:18am

Thank you so much man! Congrats on your internship and best of luck to you in the future!

Edit: You located in the DFW area?

Joshua Gillest
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Jul 22, 2020 - 11:24pm

I think you're on a great track with your prep work. The excessive amount of resources out there can be overwhelming but its honestly not too different from IB-style prep, except with a focus on being able to think for yourself and evaluate things quantitatively as opposed to more novice questions like "walk me through depreciation".

As you know, PE firms typically hire candidates who are former IB analysts, so they expect you to have a fairly comprehensive IB level of understanding, Instead of asking 5-6 technical questions about statements, cash flow, and valuation like in an IB interview, they'll likely just ask you 1 or 2 and expect you to answer confidently and comprehensively. The bulk of PE style technicals from my experience have been LBO focused questions that are phrased more like consulting questions. As opposed to asking something really straightforward like "how do you set up debt repayments in an LBO" they're more likely to ask something like "if target company A has X purchase multiple, Y exit multiple, and Z ebitda expansion multiples and company B has...which is more likely to meet the buyer's hurdle rate", or "what are some risk considerations in this buyout"? Therefore, it's important to not only know your LBO's in and out but also to practice full LBO consulting style cases where you need to give recommendations.

Finally, you should know that most PE interviews have case studies. Every PE interview I've done has had one. Some email you a file with an LBO case study and expect you to email it back in 24 hours, some 3 hours, some are done IRL where they lock you in a room. There's no good way to prepare for them because every firm's case studies will be different. I recommend finding practice "case-based" LBOs and doing them with somebody more experienced than you so you can understand how every variable effects the IRR outcome.

Jul 23, 2020 - 12:20am

This was very solid and helpful advice! Thank you so very much!

Joshua Gillest
Most Helpful
Jul 23, 2020 - 2:57pm

I went direct to buyside in DFW. For me, mastering Excel was step 1, then accounting, then modeling, then playing around with inputs and sensitivity, then case studies and thesis generation.

Doesn't have to be in that order, but it helped me to 1) know how to use the tools, 2) know the rules that govern my work, 3) apply those tools within the rule-based framework, 4) understand the available levers and their implications, and 5) figure out how to pull those levers (and which to avoid pulling) to create value in a given deal

Jul 23, 2020 - 3:47pm

Thank you so much! I like the order you described and will be following that to see if that best works for me!
What firm did you get in with?

Joshua Gillest
  • Intern in IB - Gen
Jul 23, 2020 - 4:08pm

Does anyone have experience with spring PE internships? I'm graduating in December and thinking about working in PE before starting FT in IB

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