Can you go straight into private equity from college?
Get into private equity right out of college
Private equity firms typically do not usually hire straight out of college or business school unless the student has previous significant private equity internships or work experience.
Coming into private equity with no experience is impossible, so finding an internship or having previous experience in a related field is highly recommended.
Private Equity Analysts are hired directly out of undergrad without previous full-time experience. They work on the same types of tasks as Associates: deal sourcing, reviewing potential investments, monitoring portfolio companies, and fundraising, but they complete fewer projects independently from start to finish.
Nearly all the large private equity firms (“mega-funds”) offer some form of internships to undergrads: KKR, Blackstone, Ares, Silver Lake, Carlyle, TPG, Apollo, and, on the European side, firms like Cinven, CVC, Bridgepoint, EQT, and Permira.
Get into private equity right out of college
A finance degree is usually the most valued in the field. If you can't get a job or an internship in private equity during or right after college, consider getting one in a complementary field, like investment banking, venture capital or asset management.
Instead of jumping straight into PE from college, they go through a few years of investment banking or management consulting first, then switch into PE. The advantage of this is that investment banking firms are larger, and the very nature of a larger firm is that there are more jobs available.
Blackstone considers candidates from schools across the globe. Candidates eligible for full-time opportunities are completing their final year of college or graduate school.
Private equity firms usually seek someone with a strong sense of numbers. As such, the majors they generally look for include Finance, Accounting, Statistics, Mathematics, or Economics. GPA will, of course, be a factor here.
For the vast majority of first-year private equity associates, the base salary is around $135k to $155k. Then, based on fund performance, bonuses tend to range from 100% to 150% of the base salary.
Is it harder to get into private equity or investment banking?
Private equity offers a more attractive work/life balance but is also potentially even harder to break into. Like investment banking, PE also offers opportunities to move into asset management, hedge funds, venture capital, or other senior roles in finance.
The Cold, Harsh Truth About Low Grades
If you've earned a low GPA over several years, industries such as investment banking and private equity are probably not right for you.
Cardinal said several factors are likely motivating colleges to move away from PE requirements: Students have a lot of other courses they're required to take for graduation, and there is a prevailing assumption that most learn basic physical education in their K-12 years, making it less necessary at the college level.
For a student looking to break into one of the top 10 PE firms, your chance is 1 in 300 or 0.33%. To break into one of the top 10 hedge fund firms, your chance is 1 in 147 or 0.68%.
Earning potential: While both consulting and private equity can be high-paying careers, private equity investors make more money given their ability to share in the upside of their deals (e.g. carry, bonus, etc.)
For years Blackstone has been known for hiring only the best, or those who graduated Phi Beta Kappa from Ivy League schools like Harvard or Yale.
KKR is committed to hiring early career talent from both undergraduate and MBA academic programs for internship and full-time roles across our investing and distribution businesses in the U.S. The bedrock of KKR's culture is our spirit of partnership and a shared sense of ownership across the firm.
There are several ways to branch into private equity investing, including through mutual funds, exchange-traded funds, SPACs, and crowdfunding. However, keep in mind that many private equity opportunities are only offered to qualified investors and may require a sizable minimum commitment as well as a high net worth.
Can you go into private equity from asset management? Private equity is one of the investment strategies employed in asset management to help grow and manage the assets and resources of their clients. So yes, you can go into private equity investing from asset management.
Once again, the CFA also ranks relatively high in the alternative investment sector. 22% of asset management professionals on the database have studied the CFA, and this figure is 18% in private equity. A lot of limited partner private equity firms will hire undergraduates and then put them through the CFA.
Do you need an MBA for private equity?
Private equity is somewhat of an elite club. The field is notoriously difficult to enter. Most top private equity firms want skilled employees who they don't have to spend a lot of time training. In other words, you won't stand much of a chance at getting into a top private equity firm without an MBA.
Requirements: You must be attending Hight School or an accredited university as a full-time student, or have graduated from an accredited university within the past six months. You must maintain a minimum 2.5 GPA.
62% of job seekers rate their interview experience at BlackRock as positive. Candidates give an average difficulty score of 3 out of 5 (where 5 is the highest level of difficulty) for their job interview at BlackRock.
$217K (Median Total Pay)
The estimated total pay range for a Private Equity Associate at The Blackstone Group is $171K–$282K per year, which includes base salary and additional pay.
Private equity investing often have high investment minimums, which can magnify gains but also magnify losses. Liquidity risk exists since private equity investors are expected to invest their funds with the firm for several years on average.
