Answering Why Private Equity - 9 Key Answers

Patrick Curtis

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Patrick Curtis WSO Editorial Board

专业知识:在vestment Banking | Private Equity

This question pops up in almost every private equity interview. It's not something that will land you the job, but the wrong answer will get you dinged.

为什么要私募股权职业?

本节将阐明私募股权作为职业。有关回答采访问题“为什么要私募股权?”的信息,请跳到下一节。对于那些不确定您是否想在私募股权工作的人来说,这是人们认为私募股权吸引人的典型原因:

  • The magic word:carry。It's true that a chosen few make 10-100s of millions through carry in private equity, but this is a reality seen by very few. Here's some insight from @cheese86" that explains carry and when/how to get it.

    奶酪86:
    携带的利息很大,但是大多数基金直到在基金生活中获得8-10%的年收益后才能携带。如果您的基金没有达到携带标记,那么您的补偿将类似于银行业务,甚至可能更少。
  • 这项工作本身是许多主要原因,许多人将私募股权视为职业,尤其是与投资银行业务相反。bob竞技体育游戏这是对@HerSerendipity的问题的一些想法”,这是一个私募股权合伙人。

    HerSerendipity - Private Equity Associate:
    较大的商店肯定是针对初级人员提供的交易,但是较小的商店将提供更多的动手体验。这也取决于PE商店的业务方式;有些人在起源和投资组合管理之间有明确的描述,有些人模糊了界限,有些则需要人们两者兼而有之。
  • 另一个区别是责任。在私募股权中(再次反对投资银行业务,因为大多数人来自这里)。bob竞技体育游戏这是行业首席执行官@marcus_halberstram的印象,即使在最低级别的私募股权中的责任。
  • 以下是一些其他原因,对私募股权的私募股票有一些很好的见解,这是 @peguy2011的礼貌。
    • 小时更好。不是9-5,但是当您在晚上11点后每天花三年的时间回家时,工作60-80小时的工作就很短。
    • Culture is much better- not as much "busy" work... meaning making sure a deal is a real deal before spending a significant amount of time on it (vs. in banking, building a model for every damn pitch). Also, when I was in banking, face time was a pain in the ass. I don't think there is any business where you don't have to deal with face time, but I think in PE it is generally more lax.
    • Relationship building。在working in PE, you will build relationships with CEOs, CFOs, COOs, directors of corporations, at the target, when/if you hire a third party advisor, and at your portfolio companies. I value this because, when/if I ever decide to leave PE, these are some of my exit opportunities. For example, I worked extremely well with the interim CFO of a target company. After he left and went to another business, he asked me to come on as VP of Finance.
    • 与投资组合公司合作关闭很棒。我喜欢参加策略会议和美国银行rd meetings and working actively with management teams to improve businesses. This combined with the next bullet are two things I think that really prepare you for anything, whether it's a consulting role in the future or starting your own business.
    • Knowledge learned is much more interesting and valuable. Admittedly at the associate level, you're still doing a lot of work an analyst does in banking (models, presentations, memos), but you're also spending more time learning about different businesses, industries and most importantly what makes a business successful.

    These are just a few of many reasons people decide to go into private equity. The opportunity, work, and compensation are why this is considered by many the promised land of finance careers (although don't let that fool you into thinking it's最好的对您来说,这是一个深切的个人问题,随着您的身份而异)。

    在terview Question - Why do PE?

    First, know to keep it brief.不要超过45秒;理想情况下,将其保持在30秒钟左右。您只需要给出一个理由,为什么您想在私募股权中工作并将其绑在背景中,全部以3-4个句子为单位。这是您可能使用的一些原因:

    • 您想了解超出财务方面的企业。
    • You want to work with companies over the long-term to see what makes a great business and to better yourself as an investor.
    • You want to learn about the many operations of a company.
    • You want to invest in the long-term as you believe it is the investment strategy that delivers the best returns.

    Why This Firm? question in an interview

    除了问“为什么要私募股权?”以外,面试官会问:“为什么要我们的公司?”这是您事先进行研究至关重要的地方。该公司专门从事什么?他们的投资策略是什么?您的背景如何满足该公司的专业/策略?确保您进行尽职调查,并针对此问题定制特定答案。

    对私募股权感兴趣 - 这是您需要突破的

    Private equity is recruiting is ten times more cut-throat than anything you've ever experienced before. If you want to break into private equity, you need to be well-practiced in the technical aspects of the interview. The package is worth well more than the $299 price; the job prospects you set yourself up for are worth far more than $299.

    体育采访时有限公司urse Here

Patrick Curtisis a member ofWSO Editorial Board这有助于确保在华尔街绿洲上的顶级文章中内容的准确性。bob平台提现规则他在罗斯柴尔德(Rothschild)和沃bob竞技体育游戏顿商学院(Wharton Business School)的MBA上拥有在罗斯柴尔德(Rothschild)的投资银行业务和私募股权方面的经验。他还是华尔街绿洲的创始人兼现任首席执行官,此内容最初是由成员创建的bob平台提现规则lionwater并在我们的私募股权导师的帮助下进化。

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Comments (22)

2012年6月12日 - 下午4:06

[QUOTE = Happypantsmcgee]//www.xinhe369.com/forums/why-do-ppl-choose-megafunds-over-…]

谢谢,但是这个话题更多地是关于为什么巨型毫米。My question is the opposite.

Also, I am more interested in what is a good answer, rather than what the real reasons are (i.e. slightly better lifestyle, though not always the case.. especially at top毫米funds).

而且该线程中的大多数人都说这项工作几乎是相同的毫米and megafund at the junior levels..so what can I say to an interviewer that is at least somewhat true and doesn't make me seem lazy.

。。maybe that I see more growth opportunities in the毫米公司比Megacap Corporations ..?

Jun 12, 2012 - 4:00pm

More deals in the market = more experience at the junior level, closer interaction with all levels, etc.

CompBanker can probably crush this question.

毫米IB -> TMT Corporate Development -> New Ventures
最好的回应
2012年6月12日至9:18 pm

I've hit a lot on the "real reasons" why someone might choose毫米超过大帽 /巨型。其中一些也是一个良好的答案(责任),而另一些则是答案不佳(小时)。我将尝试在这里采取不同的方法。

您目前在BB。Try to think of all the reasons you DISLIKE working in such a large organization. Is it a lot of red tape? Do you hate having to report to twenty different bosses in five different groups, none of which talk to each other? How about the size of your deal teams? Do you like having responsibility for a small piece of a large transaction or would you prefer responsibility for a large piece of a small transaction? Try to think of which environment is most appealing to YOU and drive your responses based on that.

Having worked in毫米IB/毫米PEmy entire career, here are a few of my thoughts:

The most important aspect of any job is the people that you work with. Regardless of what work I'm doing, I enjoy it infinitely more alongside people that I respect and have built a relationship with. At a large organization such as a megafund, the large deal teams and structured organizational chart create a different work environment than one would encounter at a毫米PEfirm. I prefer having a handful of colleagues over hundreds.

在您的职业生涯的早期,尤其是在MBA前职位上,尽可能多地学习具有巨大的价值。在大型私募股权商店中,您的工作职能典型地减少到交易过程中的一个小方面(例如,我知道Megafund的一个人连续两年与一家投资组合公司一起研究和跟踪中国运输市场)。在较小PEshops, not only do you get exposure to ALL aspects of transactions, you are given ownership over key tasks and play a meaningful role in the completion of the transaction. This increased exposure will put you leagues ahead of your peers at larger shops.

Similar to point number two, the "exploratory" work in毫米PE大大低于Megafunds。在毫米PE(没有采购模式),您将几乎100%的时间从事实际交易,而且数量很高。典型的合伙人可以期望在两年内亲自审查50至100笔交易。他们可以期望完成至少一个平台,多个附加收购以及潜在的多重销售。现在,大交易市场真的很挣扎。数十亿美元lbos正在发生。当您有200亿美元的资本可以部署时,您可以追求的目标有限。鉴于那里的巨型股票数量和每个基金的同事数量,您完成多亿美元交易的几率非常低。当然,您可能会进行一些较小的附加收购,但是如果是这样,您不应该去毫米PEshop to begin with?

Finally, while deals in the毫米不太可能制作《华尔街日报》的头版,归根结底,这几乎对您的生活没有影响,尤其是作为初级专业人员。几个小时后,作为数十亿美元合并起草资金流的合伙人的凉爽因素。在购买价格上加三个0并不会使您看起来更聪明或更好。您的父母和朋友不会留下深刻的印象(如果您谈论工作太多,您可能会被标记为冲洗)。因此,除非您试图满足内在的需求,否则要做更大的交易确实不会改变您的生活。

And of course, there is the money. I'm guessing that excluding my carried interest, I still make less money than a pre-MBA megafund associate. However, the marginal value of money decreases more rapidly than you would think. I live in a penthouse suite by myself, have every gadget known to man, a fully paid for luxury car, a $30,000+ wardrobe, dine out all the time, take international vacations every quarter and weekend trips around the country month or two, and still manage to save my entire bonus every year. While I've never lived in纽约这显然会影响我的生活成本,每年的$ 10万美元会对我的生活水平产生零影响。对于那些打算结婚并生孩子的人,他们想送往私立学校:当您与几个私人幼儿园的几个孩子碰到30多岁时,您将赚取50万美元/年毫米PEand will have no problem covering these costs.

The above probably sounds like a rant more than anything else, but there are very real benefits associated with毫米PEthat I feel are often overlooked. When answering the question of "Why毫米PE," try to communicate how the benefits of毫米PE对您个人有意义。在某种程度上,您可以通过过去的类似经历的示例来支持它。

CompBanker

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300+ video lessons across 6 modeling courses taught by elite practitioners at the top investment banks and private equity funds -- Excel Modeling -- Financial Statement Modeling -- M&A Modeling -- LBO Modeling -- DCF and Valuation Modeling -- ALL INCLUDED + 2 Huge Bonuses.

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2012年6月12日至10:50 pm
CompBanker:
I've hit a lot on the "real reasons" why someone might choose毫米超过大帽 /巨型。其中一些也是一个良好的答案(责任),而另一些则是答案不佳(小时)。我将尝试在这里采取不同的方法。

您目前在BB。Try to think of all the reasons you DISLIKE working in such a large organization. Is it a lot of red tape? Do you hate having to report to twenty different bosses in five different groups, none of which talk to each other? How about the size of your deal teams? Do you like having responsibility for a small piece of a large transaction or would you prefer responsibility for a large piece of a small transaction? Try to think of which environment is most appealing to YOU and drive your responses based on that.

Having worked in毫米IB/毫米PEmy entire career, here are a few of my thoughts:

The most important aspect of any job is the people that you work with. Regardless of what work I'm doing, I enjoy it infinitely more alongside people that I respect and have built a relationship with. At a large organization such as a megafund, the large deal teams and structured organizational chart create a different work environment than one would encounter at a毫米PEfirm. I prefer having a handful of colleagues over hundreds.

在您的职业生涯的早期,尤其是在MBA前职位上,尽可能多地学习具有巨大的价值。在大型私募股权商店中,您的工作职能典型地减少到交易过程中的一个小方面(例如,我知道Megafund的一个人连续两年与一家投资组合公司一起研究和跟踪中国运输市场)。在较小PEshops, not only do you get exposure to ALL aspects of transactions, you are given ownership over key tasks and play a meaningful role in the completion of the transaction. This increased exposure will put you leagues ahead of your peers at larger shops.

Similar to point number two, the "exploratory" work in毫米PE大大低于Megafunds。在毫米PE(没有采购模式),您将几乎100%的时间从事实际交易,而且数量很高。典型的合伙人可以期望在两年内亲自审查50至100笔交易。他们可以期望完成至少一个平台,多个附加收购以及潜在的多重销售。现在,大交易市场真的很挣扎。数十亿美元lbos正在发生。当您有200亿美元的资本可以部署时,您可以追求的目标有限。鉴于那里的巨型股票数量和每个基金的同事数量,您完成多亿美元交易的几率非常低。当然,您可能会进行一些较小的附加收购,但是如果是这样,您不应该去毫米PEshop to begin with?

Finally, while deals in the毫米不太可能制作《华尔街日报》的头版,归根结底,这几乎对您的生活没有影响,尤其是作为初级专业人员。几个小时后,作为数十亿美元合并起草资金流的合伙人的凉爽因素。在购买价格上加三个0并不会使您看起来更聪明或更好。您的父母和朋友不会留下深刻的印象(如果您谈论工作太多,您可能会被标记为冲洗)。因此,除非您试图满足内在的需求,否则要做更大的交易确实不会改变您的生活。

And of course, there is the money. I'm guessing that excluding my carried interest, I still make less money than a pre-MBA megafund associate. However, the marginal value of money decreases more rapidly than you would think. I live in a penthouse suite by myself, have every gadget known to man, a fully paid for luxury car, a $30,000+ wardrobe, dine out all the time, take international vacations every quarter and weekend trips around the country month or two, and still manage to save my entire bonus every year. While I've never lived in纽约这显然会影响我的生活成本,每年的$ 10万美元会对我的生活水平产生零影响。对于那些打算结婚并生孩子的人,他们想送往私立学校:当您与几个私人幼儿园的几个孩子碰到30多岁时,您将赚取50万美元/年毫米PEand will have no problem covering these costs.

The above probably sounds like a rant more than anything else, but there are very real benefits associated with毫米PEthat I feel are often overlooked. When answering the question of "Why毫米PE," try to communicate how the benefits of毫米PE对您个人有意义。在某种程度上,您可以通过过去的类似经历的示例来支持它。

You have carried interest as a partner I'm assuming? What did you make starting out as an analyst? Did you have to get anMBAbefore working at the毫米PE?

Jun 12, 2012 - 11:05pm
mokey1234:
You have carried interest as a partner I'm assuming? What did you make starting out as an analyst? Did you have to get anMBAbefore working at the毫米PE?
最多PE公司具有“ MBA前”职位,通常为分析师或合伙人。该职位通常由两/三年的银行或咨询的人填补。工资在毫米,最小毫米firms paying low 100s and the largest毫米公司支付200年代中期。MBA后通常被称为高级副总裁或副总统,通常有多年PEexperience. Pay is meaningfully higher than the pre-MBA position and often includes a small piece of carried interest. Personally, I don't have anMBA, but my position is considered a post-MBA position and the partners have indicated that they would prefer I work my way up to Partner level without one.

CompBanker

  • 3
Jun 12, 2012 - 10:32pm

Compbanker, +1 for you - i'm a miser with my SBs, but everytime advice like this is doled out on the forum, I feel happy to part with one.

Lionwater - any slight variation of the above should blow your interviewer away. Full resonate with what has been said above. To provide another example that supports what Compbanker said above (about the megafund associate he knows spent two years studying the chinese transportation market), I received a resume for a VP level position at our fund from someone who currently goes toHBS并在一家顶级Megafund(想想Thlee,Carlyle,Providence)工作,他花了两年的时间评估该基金的一家投资组合公司的两次附加收购,而该人的唯一实际交易经验是失败的300亿枚杠杆买入,这是该基金的损失。由于该公司无法以有吸引力的条件筹集足够的债务融资而崩溃(廉价盟约轻债务交易的日子已经一去不复返了)。

在fact, you could probably use the above as another reason to move to a middle marketPEfund (after you've exhausted Compbanker's suggestions). Something maybe along the lines of the probability of getting a deal done at the megafund level being really low these days since current market conditions don't support such deals anymore - you have somehow had first hand experience at yourBB要么为潜在的端口cos/试图为交易提供资金PEMegafund客户不会经历。您宁愿处理较小的交易,具有更高的执行概率。一切顺利。

2012年6月13日 - 上午9:48

+1 comp ...您的帖子几乎总结了为什么我决定去毫米路线...我还选择了它的生活方式,但是似乎有机会在具有更苗条的结构的较小商店中更大的责任和快速发展。

Jun 13, 2012 - 3:31pm

CompBanker hit the nail on the head - ALL of his reasons are precisely why I left banking 1 year early to accept my毫米PEgig. (See my post on jumping to the buyside for more detail if interested)

2018年2月18日 - 下午5:59

我为一个PE购物然后尝试进入IBfrom there, and the hardest question was "Why Investment Banking?" after interning inPE。Still never figured out how to answer that..

2月19, 2018 - 5:20am

"Why PE?"(Originally Posted: 04/24/2007)

嘿大家,

I've got an interview with a private equity fund of funds on Wednesday, and I'm wondering: what's the best answer to the question "why do you want to work in PE?" I definitely have my own reasons, but I'm just curious to know what's the most compelling way to answer this question. How do you sell aPE在自己上购物?

谢谢!

2月19, 2018 - 5:22am

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