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A Career in Private Equity: An Overview

Career in Private Equity

A career in Private Equity (PE) is one of the most sought-after careers in the finance sector. PE firms buy or invest in private companies that are working to increase their value. They provide capital to help companies grow, restructure, or develop new products. They help the company in which they invested to gain long term benefits. They add value to the company they bought and sell it for profit. During the course, they earn money on a commission basis. 

E.g.

  • Canadian PE firm – CAI Capital Partners sold Houston-based CSAT solutions, an electronic and digital device repair partner for global original equipment manufacturers, to Insight Equity. CAI gained interest in CSAT in January 2013. All through its hold period, CAI encouraged management as they invested in technology, infrastructure, and people. CAI supported to expand the organization and improve the company’s leading market position, reports The PE Hub Network. 
  • Clayton, Dubilier, and Rice LLC, acquired Anixter International Inc., under merger agreement terms. The transaction value was US$ 3.8 billion. The transaction will take Anixter private and is anticipated to close by the end of the first quarter, 2020, reports Industry News. 

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Round-the-clock events in the industry attract any aspiring professional to take up a career in PE. A career in Private Equity is not the first step in your finance career. It is more often the destination or might take the mid-place in the career journey. Some of the fascinating reasons to take up a career in PE are as mentioned below. 

Why should you consider a career in Private Equity Firms?

As mentioned above, it is a destination career. Let us see what attract the professionals to consider this career. 

  • The knowledge acquired is valuable
  • Working 60-80 hours in a week feels short 
  • Every deal is a real deal as it depends on face time 
  • Build a relationship with CEOs, CFOs, COOs, and the directors of corporations
  • Take part in strategy sessions and board meetings
  • Work with the management team to improve business
  • Spend more time learning about different businesses and industries

A private equity job allows you to work with high compensation. 

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Interested in Private Equity – Here is the secret to success

Private Equity firms recruit MBAs from business schools and professionals who have a couple of years of investment banking. Like in investment banking, the entry-level position is an analyst. As an analyst, you research new deals, investment areas, prepare relevant documentation, coordinate research, and so forth. 

Apart from being a finance person, the baseline qualification is timing, says Bjorn Marten son, Black Pearl Capital. He says the underestimated skill for private equity professionals in – sales.

He says PE firm is not a ‘buy and sell’ company on a daily basis. A background in sales helps you to understand the market, which is crucial to make the investment successful. You should get prepared for trenches. People skills, analytical skills, and knowledge of product development are much needed to thrive in the industry.  

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A final note

Nothing is impossible if you have the zeal. Prove your hard and soft skills that can add value for businesses to join a PE firm. 

What do you think?

Written by Parasteh

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