- Take a more hands on approach with businesses - investing in them for longer term value
- Combine financial modelling skills with business acumen to gain a more holistic view on how different businesses operate
- Be involved in the restructuring and revamping of the business models of global corporations
As a private equity analyst, you'll manage a pool of funds on behalf of clients, investing in companies to revamp their business models and then sell-off for a significant profit. Clients in private equity tend to be insurance funds, pension funds, and wealthy individuals.
- Number crunching
- Working for portfolio companies to gain maximum value
- Looking for new profitable business opportunities for the companies
- Determine the value of potential target companies for your portfolio via financial models, as well as divesting (sell off) portfolio companies
You'll work very long hours, and be based in an office. Your working environment may be stressful at times.
To be a private equity analyst, you'll need financial modelling and analysis skills, numerical ability, good communication skills, leadership and team-work skills, good time management, and the ability to cope well under pressure.
You would normally require a degree to work in private equity. It is very rare for people to go into private equity straight out of university, but it does happen. It is typical for people to go into private equity after 2-3 years of investment banking experience (usually in M&A or leveraged finance). Private equity is also another common route for strategy consultants. A lot of private equity recruits go straight into the role following an MBA.
As you progress through your career, you will usually assume the responsibility of 'originator'. As the name suggests, you will be in charge of originating deals, looking for new companies to invest in.
Private equity is usually seen as an end destination rather a new career. As a result, people working in private equity tend to work in the sector for a significant number of years. However, it is common for members of a private equity firm to jump ship and work on the board of directors for a former portfolio company which has been divested.