Careers Guide
There are different career paths in private equity. How can you find out which would suit you best? Read our summaries below of the skills, experiences and personality characteristics you need to succeed in each.
Career Paths
Our experience of helping hundreds of people take their first step into private equity has shown us that presenting
your background and experience to highlight your relevant skills can considerably enhance your chances of successfully
securing your first private equity position.
To begin your career in private equity you will probably join the industry as an analyst or associate.
Don't be too concerned about the job title - these vary from firm to firm and don't equate to the same job titles in other sectors. Your academic achievements will
need to be high and you'll need to be able to show both financial analysis skills and commercial acumen irrespective
of the type of career or segment of the private equity sector that you choose.
To increase your chances of
success, find the sector and type of role that fits your skills and personality best and read how your career can
develop in each of these.
Direct investors acquire majority or minority stakes in mature, growing or early stage businesses often using debt to enhance their equity return. Private debt providers use the same skills and techniques to assess the opportunities. Acquisitions, buy-outs, growth capital, buy and build, start-ups and seed capital are all direct investment strategies.
You're most likely to be successful in developing a direct investment career if you have a background in M&A, leveraged finance, lead advisory, transaction services or strategy consultancy. If you don't have experience in one of these you'll need to work harder to show that you have what it takes to develop a direct investment career.
You'll need to show great financial analysis skills, a robust commercial outlook and a winning interpersonal style. Relevant language skills or specialist sector experience can also be helpful.
The path to partnership from analyst to associate is approximately two to three years at each level depending on when you join, typically taking about five years to reach a senior associate or VP level. From there you will get the chance to move to principal and then to partner as you demonstrate deal leadership and deal origination success. See our brief guide to the responsibilities associated with each level in a typical private equity fund.
You're most likely to be successful in developing a direct investment career if you have a background in M&A, leveraged finance, lead advisory, transaction services or strategy consultancy. If you don't have experience in one of these you'll need to work harder to show that you have what it takes to develop a direct investment career.
You'll need to show great financial analysis skills, a robust commercial outlook and a winning interpersonal style. Relevant language skills or specialist sector experience can also be helpful.
The path to partnership from analyst to associate is approximately two to three years at each level depending on when you join, typically taking about five years to reach a senior associate or VP level. From there you will get the chance to move to principal and then to partner as you demonstrate deal leadership and deal origination success. See our brief guide to the responsibilities associated with each level in a typical private equity fund.
Fund investors make long term commitments to private market funds. They're often known as limited partners or LPs and include fund of funds, pension funds, insurance companies, sovereign wealth funds and family offices. The private equity firms they invest in are often called general partners or GPs.
The LPs recruit from similar backgrounds to the direct investors, GPs, including M&A, leveraged finance or strategy consultancy. You'll also need to have a top class academic background.
To develop a successful career in fund investing you'll need to show a collaborative and cooperative style, strong qualitative as well as quantitative skills, intellectual curiosity and great written and presentation skills.
Starting your career here can lead to a broad international understanding of private equity. You'll get insight into the workings of many private equity businesses. A career path from entry starts with learning how to undertake due diligence on private equity funds, moving on to designing a portfolio allocation strategy and then on to fund raising and overall business strategy. Many LPs offer the opportunity to work in their offices around the world and you'll almost certainly travel as you undertake due diligence on private equity funds.
Some LPs also participate in direct investment through co-investing on transactions giving you hands on exposure to the direct investment process.
Earning potential is on a par with mid market private equity funds.
The LPs recruit from similar backgrounds to the direct investors, GPs, including M&A, leveraged finance or strategy consultancy. You'll also need to have a top class academic background.
To develop a successful career in fund investing you'll need to show a collaborative and cooperative style, strong qualitative as well as quantitative skills, intellectual curiosity and great written and presentation skills.
Starting your career here can lead to a broad international understanding of private equity. You'll get insight into the workings of many private equity businesses. A career path from entry starts with learning how to undertake due diligence on private equity funds, moving on to designing a portfolio allocation strategy and then on to fund raising and overall business strategy. Many LPs offer the opportunity to work in their offices around the world and you'll almost certainly travel as you undertake due diligence on private equity funds.
Some LPs also participate in direct investment through co-investing on transactions giving you hands on exposure to the direct investment process.
Earning potential is on a par with mid market private equity funds.
Secondaries teams buy LP interests in private equity funds. The investments are technical and complex.
To be successful in this role you will enjoy manipulating data. The secondaries firms tend to recruit from private equity, accounting or investment banking and you'll need to have strong analytical and transaction execution skills.
The route to partnership is probably fastest in the secondaries market as it is still evolving as an investment class. If you are good you could make VP or principal in three years. Partnership depends on your ability to source and deliver superb investments.
You can establish a track record more speedily as timing to exit is faster in secondaries than any other PE investment business. So your performance is more visible. Many secondaries players are global and the opportunity exists in many of them to transfer to other international offices.
With great modelling skills and creative view on how to turn future cash flows in to a well structured investment you can have a stimulating and rewarding career in secondaries.
To be successful in this role you will enjoy manipulating data. The secondaries firms tend to recruit from private equity, accounting or investment banking and you'll need to have strong analytical and transaction execution skills.
The route to partnership is probably fastest in the secondaries market as it is still evolving as an investment class. If you are good you could make VP or principal in three years. Partnership depends on your ability to source and deliver superb investments.
You can establish a track record more speedily as timing to exit is faster in secondaries than any other PE investment business. So your performance is more visible. Many secondaries players are global and the opportunity exists in many of them to transfer to other international offices.
With great modelling skills and creative view on how to turn future cash flows in to a well structured investment you can have a stimulating and rewarding career in secondaries.
Investor relations is managing the relationships with investors in the funds, building relationships with potential new investors and fund raising. The firm cannot exist without funds to invest and investor relations has increasing prominence within any private equity business.
The private equity firm is often referred to as a general partner or GP. The investors in the funds under management are referred to as limited partners or LPs. The increasing demands from LPs for information and the need to put a compelling story together to fund raise successfully means that there has been increasing demand for people to join investor relations teams.
GPs tend to recruit their investor relations people from elsewhere in private equity such as direct investment professionals, financial control or fund administration or externally from corporate finance. You have to have good numeracy, be well organised and like the selling and relationship aspect of the role. Career wise, investor relations and fund raising are becoming increasingly important and there are clear routes to partnership if you are successful in this field.
The private equity firm is often referred to as a general partner or GP. The investors in the funds under management are referred to as limited partners or LPs. The increasing demands from LPs for information and the need to put a compelling story together to fund raise successfully means that there has been increasing demand for people to join investor relations teams.
GPs tend to recruit their investor relations people from elsewhere in private equity such as direct investment professionals, financial control or fund administration or externally from corporate finance. You have to have good numeracy, be well organised and like the selling and relationship aspect of the role. Career wise, investor relations and fund raising are becoming increasingly important and there are clear routes to partnership if you are successful in this field.
Marketing is managing the external image of the firm through press and public relations, websites, literature and so on as well as actively prompting the firm to contacts and intermediaries through a programme of events. You'll need to have a strong academic background, financial services marketing experience and good writing and presentation skills.
Many private equity marketing professionals grow with the private equity firm as it increases funds under management or move to larger firms. The career path to director level is clear. It would be more unusual to move to partner in this role. It is quite common for this role to be combined with investor relations in smaller funds.
Many private equity marketing professionals grow with the private equity firm as it increases funds under management or move to larger firms. The career path to director level is clear. It would be more unusual to move to partner in this role. It is quite common for this role to be combined with investor relations in smaller funds.
Business development, origination and research are roles that involve generating investment ideas and producing market research to inform thinking. An increasing number of private equity funds have some one or a small team responsible for this. They look for people who can research and put together pitches, sometimes cold calling to develop relationships.
You'll probably have a background in M&A or consulting. There are a number of firms, particularly the large growth capital investors, whose investment analyst programmes include a large element of sourcing where you will be expected to identify businesses within a sector and get to know the management teams with a view to building a long term relationship for future investment.
From a career development perspective these roles vary from those which remain research oriented to those that offer the prospect of moving into investment.
You'll probably have a background in M&A or consulting. There are a number of firms, particularly the large growth capital investors, whose investment analyst programmes include a large element of sourcing where you will be expected to identify businesses within a sector and get to know the management teams with a view to building a long term relationship for future investment.
From a career development perspective these roles vary from those which remain research oriented to those that offer the prospect of moving into investment.
Financial control and fund administration are important roles in private equity. The CFO and his/her team will focus on many aspects of the development of the business. These roles offer long and challenging careers for ACAs who have worked in financial services audit and fund management or similar. The teams often comprise a CFO, a financial controller and a funds administrator.
As CFO you are the most senior non-investment professional in the business and may well manage everything that is not direct investment. This could include any or all of IT, facilities management, recruitment, other HR matters, compliance, company secretarial and investor relations.
Some CFOs go on to become head of investor relations because of their familiarity with LP requests and knowledge and insight into the performance of the funds. CFOs have detailed insight into the workings of the private equity firm and tend to stay for many years with financial rewards on a par with the senior investment professionals.
As CFO you are the most senior non-investment professional in the business and may well manage everything that is not direct investment. This could include any or all of IT, facilities management, recruitment, other HR matters, compliance, company secretarial and investor relations.
Some CFOs go on to become head of investor relations because of their familiarity with LP requests and knowledge and insight into the performance of the funds. CFOs have detailed insight into the workings of the private equity firm and tend to stay for many years with financial rewards on a par with the senior investment professionals.
Administration and secretarial requires great organisational skills, attention to detail, high energy, a thick skin and an ability to do at least ten things at once in these challenging private equity environments.
The role is fast paced and exciting and compensation is generally towards the top of the market for experienced private equity support staff. PER works with Tiger Recruitment on administration and secretarial roles, click here to send them your CV.
The role is fast paced and exciting and compensation is generally towards the top of the market for experienced private equity support staff. PER works with Tiger Recruitment on administration and secretarial roles, click here to send them your CV.
Human Resources is a growing field in private equity. Only the larger firms have human resources professionals in their team. The numbers are growing. Career progression is to director level. The HR head works closely with the partners in developing good HR practices in the business as well as career development, recruitment and compensation and benefits programmes.
The role is often strategic and can include internal and external perception of company values and moving the organisation towards a common set of goals.
The role is often strategic and can include internal and external perception of company values and moving the organisation towards a common set of goals.