How to start a career in a private equity firm
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Working in a private equity backed company can be a rewarding experience, but have you considered seeing it from the other side by joining a private equity firm? It might be easier than you think if you have the required skill set combined with dashes of flexibility and tenacity.
Let’s start with misconceptions about private equity firms. Some think of the Richard Gere character in the 1990 film Pretty Woman before his end-of-story transformation, in which a proudly unemotional Edward Lewis acquires a family business for the sole purpose of dismantling and selling it for parts. The misconception is that PE firms are out to destroy jobs; in reality, they typically are job creators.
Charles Aris spends a lot of time working with the smartest, most passionate private equity teams around the world; these are filled with team members who care deeply about building great businesses. It’s through an investment lens, of course, but many of their portfolio companies have gone on to achieve growth that would not have been possible without the firm.
If you’re convinced that private equity might be a good professional fit for you, it’s important to consider key candidate qualifications sought by PE firms. Private equity positions typically require a background in quantitative data analysis, but that doesn’t necessarily mean a college degree in that area of study is a must so long as the quantitative skill set is verifiable.
Generally speaking, private equity firms hire individuals with experience in business, finance and economics more frequently than other fields. More specifically, many of the best and brightest in the worlds of consulting and investment banking are attractive to PE firms. It’s a misconception, however, that you must have worked in an investment bank to be of interest to them.
One of the biggest challenges – if not the biggest challenge – in being hired by a private equity firm is putting in the time and effort to find the right opportunity. In fact, there’s a good chance you’ll never find that right opportunity posted on any job board or firm website.
The secret is activating your network and being more proactive than your peers. If your virtual Rolodex seems empty, you can begin to change that right now. Cold calls to introduce yourself and explain how you can help – along with well-placed emails and Linkedin messages to line up chats over coffee, for example – can be highly effective in getting your name in front of the right people at the right time.
Flexibility also plays a key role in landing a career opportunity with a private equity firm. The odds of finding a firm that is the perfect size in the perfect location with the perfect people are slim, so identify one or two must-haves and then have an open mind.
We hear many people say they want to work for a megafund, but oftentimes they don’t have a full grasp of what that really means. Consider the size of the fund, investment strategy and industry focus (or generalist approach) because these factors will greatly impact what the experience is like from cultural, experiential and developmental perspectives.
While embarking on a career in a private equity firm can be difficult, you can increase your chances by casting aside misconceptions and taking a few key steps. You might not get recognized on the silver screen like Richard Gere, but you’ll be on the path to sustainably improving companies far and wide.