Value Buy-out vs Growth Buy-out Discussion from Associate Perspective
With PE on-cycle coming up I thought it'd be a good time to have a discussion on the Pros and Cons of Growth Buy-out vs. Value Buy-out Private Equity from an Associate perspective. I'm trying to hear some people's perspectives on which style of Buy-out firm they'd prefer to work for.
I'm specifically trying to focus on firms that are doing primarily buy-outs (so not special situations or true growth equity)
On the growth side of things are firms like LGP, TSG, General Atlantic where they seem to be totally cool paying 15x+ for businesses that are super healthy and high growth. My understanding is that these types of firms generally are able to develop you better as an investor as you are probably spending more time focused on new investments, looking at lots of different CIMs and are spending less time out visiting portcos / working to make operational improvements. Generally more of a "buy and forget" style.
On the value side of things are firms like American Industrial Partners, Platinum, Cerberus or firms even middle market / lower middle market that do lots of in-house sourcing and are looking to buy cheap businesses and spend a ton of time improving them. My understanding is that you likely are looking fewer deals and are spending a much larger portion of your time doing portfolio improvement, which I think would obviously help you as an investor from an operational understanding but you might not get as many reps.
I'm curious to hear people's perspectives who work in both types of buyout shops.
Do you like spending a ton of time out doing operational work in the field with your portcos or would you prefer to be spending more time looking at new investments? Which do you think is better to develop early on in your career (associate perspective) / which gives you more optionality? Let's say you went to B school after your 2-3 years as an Associate, would it be easier to switch to from Value to Growth or from Growth to Value? Which would you say is tougher from a lifestyle perspective? I'd think growth would be tough if you're just turning millions of CIMs all the time but value / operational work could be tough if you have to spend every other week out in the plant.
Thanks in advance!