Private Equity Careers Guide

Private Equity: The Central Dogma

The years in private equity (PE) are fueled with success with its ‘But to Sell’ core strategy! PE has a secular penetration curve. It has no end in sight. Private equity firms are investment management companies that acquire companies by pooling capital. The PE firms pool capital from high-net-worth individuals, investors, and manage about trillion dollars attracting professionals to join PE.

Purchase stakes
Buy-out trades
Manage portfolio companies

A Career in Private Equity

Round-the-clock events in the PE industry attract finance graduates to find a career in PE. A career in Private Equity is not the first step, but often the destination in the finance career. Here are a few fascinating reasons to choose a PE career.

Every deal is a real deal as it depends on face time
Have direct contact with CXOs of corporations
Take an active role in strategy sessions and board meetings
Work with the management team for business decisions
Spend time to understand different businesses and industries

Career path in PE Profession

The Managing director is in charge of leading the firm, manage relationships with investors, raise new funds, participate in investment decisions, and sit on the company’s board. Moreover, as a partner, one should invest a significant proportion of personal wealth in the fund.
Deal screening and modelling, manage advisors such as investment banks, lawyers, and accountants, involve in sourcing, underwriting, closing, and monitoring PE investments, identify, structure, negotiate, close, and manage investment transactions, perform advanced analytical and operational activities for existing investments and proposed deals, monitor the financial and operating performance.
Evaluate and execute investments, manage the diligence process, finance, technology, memos, closings, and post investment management, construct competitive analysis and dive into new markets, build and maintain internal systems, models, and portfolio performance tracking worksheets, organize reporting (internal and external) - quarterly LP reports and CEO summits.
Cold calling, screening sectors for potential investors, analyze companies for investment opportunities, source deals and support transactions, manage portfolio companies, determine to raise capital and investment uses, execute exit strategies, predict return on investment.

Whom Do Private Equity
Firms Hire?

Private Equity firms usually hire their Analysts from bulge-bracket investment banks, middle-market banks, and boutique banks. They also consider PE professionals from competitor firms, and in rare cases, even undergrads for junior roles in emerging markets. But, for graduating students or recent graduates with little or no experience, it may be nearly impossible to break into private equity without an additional qualification in the PE domain. That’s the reason students of MBA and MS Finance programs around the world increasingly pursue a high-end global qualification like the CPEP™ simultaneous to their academic coursework.

What does the private equity firm expect from a PE professional?

The main responsibilities as a PE professional

Raising money
Sourcing and closing of deals
Improving operations, cutting costs
Tightening management in portfolio companies
Selling portfolio companies for profit

In addition, today, PE firms seek:

Diverse knowledge
Data analytics skills
Technical skills
Negotiation skills
Networking
People skills

When Do Private Equity Firms Recruit?

For traditional candidates for PE jobs (IB analysts, etc.), there is an on-cycle and an off-cycle recruitment process. The on-cycle process for analysts at big PE and boutique firms runs October-January/March in New York. If you are selected, you may begin to work in August of next year.The off-cycle process is meant for roles outside New York; roles for anyone who is not working at an investment bank; and roles at smaller firms. Off-cycle takes more time than on-cycle, but you start work immediately.

PE Tests & Interviews

PE firms assess technical capabilities, ability to work under stress, and with unstructured information through case studies and modeling tests. These may be quick, 30-minute tests like creating a simple LBO model, or a more standard 1-3 hour exam, asking applicants to build a real LBO model; or even a take-home test in which applicants may be required to write a detailed strategy or an investment thesis and submit it within a few days or a week.

Interested in Private Equity – Here is the secret to success

Apart from domain knowledge, the PE career is for candidates who are competitive, extremely attentive to details, and high achievers.

As PE firms tighten the recruitment and expectation amid the changing economy, take a leap into the industry by preparing for it. Upgrade yourself by learning new skills and knowledge. The best-recommended way to upskill yourself is to earn a certification in private equity.

CPEP™ Program Enables you to

Understand the fundamentals of PE funds
Know the deal origination and mechanism
Manage private equity investments
Manage funds and the GP-LP relationship
Gain knowledge about PE evolution

Ace Your PE Career in the Changing Economy by Earning CPEP™ Certification!

Apply Now

Career in Private Equity