Private Equity is a great career choice for finance professionals. There is huge potential to learn, innovate, and make much money. However, it may be challenging to get into private Equity due to the intense competition. It may need to invest time and effort in preparing for the role. The first step is understanding different types of private equity roles, scope, skills, and how to get the job.
What is Private Equity?
Private Equity is the funds a pool of investor resources to buy stakes in various companies. Since these are private investments, they are managed and owned by the people who founded them. These companies are not traded on the stock market like public companies. A private equity company purchases small companies that are not publicly listed and have a positive growth prospect. The private equity company helps them financially, restructure, grow, and resell them to earn profit. Equity firms, high-net-worth individuals, and institutional investors typically invest in this type of capital.
| Read More: Private Equity Fund Structure
Career in Private Equity
To have a flourishing private equity career, here is what we recommend:
- UG Degree in Finance Stream
Private equity firms hire people individuals who have command of numbers. Hence, they look for candidates who are from a finance background. You can get an undergraduate degree in accounting, general finance, statistics, business, mathematics, economics, etc. Also, it is as important to have a good score as having a degree.
- Gather Skills
Professionals who want to pursue a career in Private Equity need to focus on gathering relevant skills to make their way up. These highly competitive roles demand below mentioned skills:
- Negotiation skills: These skills are vital for finding lucrative deals between investors and business owners.
- Relationship skills: Working in the Private Equity field is about bonding and building strong professional relations based on trust.
- Technical skills: Focus on enhancing your subject knowledge and gathering core financial skills. These skills will help you analyze the details of deals.
- Management skills: As you reach the hierarchy ladder, you must manage your team. Start building such skills from today!
- Private Equity Internship
Practical knowledge or working in the real world means a lot in a Private Equity career. Whenever you get a chance, apply for various relevant internships. Try for big companies to make your profile more impressive. Make the most of your internship and demonstrate excellent learning and search during your internship program.
- Entry-Level Position
Find a full-time position as an entry-level analyst in a financial institution. As you gain experience, keep applying for higher roles. Try to have a wider work profile, as many recruiters select well-rounded candidates with experience and skills in several areas.
- PG/Master’s degree
Having a master’s degree in finance or an MBA from a top B-School surely helps improve your chances of landing a better job in private equity industry. Getting preliminary work experience and doing your master’s degree can fetch you easy entry into private Equity. Big firms prefer to hire candidates with PG degrees with a minimum of two years of experience and internships at other private equity firms.
If you already have an undergraduate degree in a different field than the ones listed here and want to have a career in Private Equity, you have a chance! You can take the alternate route of pursuing an MBA and find your way into a financial institution.
- Apply to Private Equity firms
You can start looking for private equity careers and positions, after gathering required skills and having your degrees, experience, and internship. There are online job boards, networking groups, consultants, and references to reach out and secure a good job. Investment banks offer jobs to qualified graduates and postgraduates with good scores who are from reputed business schools.
While the initial roles in private equity industry as ‘Analysts’ and ‘Associates’ will require you to focus on research and math. As you advance your career and gain valuable experience to become VP, Director, and MD< you will need more analytical and financial modeling skills to make data-driven decisions. It is important to note that combining degrees, technical and soft skills, and work experience will progress your career. Demonstrating your skills and energy to sound impressive to employers!