Investment Banking to Private Equity Exit
Investment banking is known as a fast-paced, demanding career with long hours and high pay. But many investment bankers also see it as a stepping stone to private equity (PE), which offers a different set of challenges and rewards. The path from investment banking to private equity is a well-trodden one, but it requires careful planning, hard work, and a bit of luck.
Typical Timelines for Recruitment
Private equity recruitment is typically more structured and longer than investment banking recruitment, with firms typically recruiting for positions well in advance of the start date, often up to a year or more in advance. Private equity recruitment processes often involving multiple rounds of interviews, case studies, and modelling tests. Typically, the recruitment process starts with submitting an online application, followed by a screening call with a recruiter or HR representative. This is often followed by a series of interviews with junior and senior members of the private equity team. For junior positions, private equity firms often recruit candidates who have two to four years of experience in investment banking. However, some firms will consider candidates with less experience if they have relevant skills or experience in other areas, such as management consulting or corporate finance.
Top private equity firms prefer candidates who have worked at top investment banks, such as Goldman Sachs, JP Morgan, or Morgan Stanley, as they have a reputation for providing excellent training and deal experience. Working at these banks will also help you build a strong network of contacts in the industry. These banks are known for providing rigorous training programs that teach candidates the technical skills needed for private equity, such as financial modelling, valuation, and due diligence. Investment banking experience also demonstrates that candidates have experience working on complex deals and have developed the necessary analytical and problem-solving skills required to succeed in PE.
Private equity firms place a high value on academic qualifications and tend to look for candidates with exceptional grades and academic achievements. Candidates who have top GPAs and graduated from Ivy League schools in the US or top-tier Russell Group universities in the UK are particularly attractive to these firms. This is because such qualifications demonstrate a strong work ethic and a dedication to academic excellence, which are highly valued traits in the private equity industry.
While private equity firms recruit candidates from a diverse range of academic backgrounds, certain degrees are commonly found among successful candidates. Business-related degrees, such as finance, economics, accounting, and business administration, provide candidates with a strong foundation and understanding of financial markets. STEM degrees, such as mathematics, engineering, and computer science, are also valued by private equity firms because they provide candidates with strong analytical and quantitative skills. Humanities and social sciences degrees, such as history, political science, and philosophy, are also relevant to private equity work as they develop critical thinking, research, and writing skills.