How much do first year private equity analysts make?
The typical career path for a private equity associate is: Associate - Usually the entry-level position in private equity. Requires 0-2 years of experience. Average base salary range: $150,000 - $200,000.
Junior associate/analyst: Employees in entry-level positions do not get to make deals or work independently through all process steps; instead, they are assigned more specific tasks such as reviewing data. Some required skills include financial modeling and the ability to work with a large amount of data.
$131K (Median Total Pay)
The estimated total pay range for a Analyst at The Blackstone Group is $110K–$157K per year, which includes base salary and additional pay.
| Position Title | Typical Age Range | Base Salary + Bonus (USD) |
|---|---|---|
| Associate | 24-28 | $150-$300K |
| Senior Associate | 26-32 | $250-$400K |
| Vice President (VP) | 30-35 | $350-$500K |
| Director or Principal | 33-39 | $500-$800K |
Yes! Private equity is one of the most competitive jobs to get – period. Not just in finance, but across the board. Private equity firms have very specific requirements for their hire candidates, both for entry-level analyst positions and for higher-level job openings.
Private equity analysts spend a significant amount of time analyzing financial statements, conducting due diligence, and evaluating potential investment opportunities. They must be able to create financial models, assess market trends, and analyze industry data to identify potential risks and opportunities.
Investors need to know they can rely on what you say and the analysis you're producing. The average during a busy time for associates and analysts is usually around ~60-70 hours per week. But it's all dependent on how many deals and investments are on the go. The above hours will vary based on if there's a live deal.
The estimated total pay range for a Private Equity Analyst at McKinsey & Company is $100K–$153K per year, which includes base salary and additional pay. The average Private Equity Analyst base salary at McKinsey & Company is $100K per year.
The estimated total pay range for a Analyst at S&P Global is £39K–£55K per year, which includes base salary and additional pay. The average Analyst base salary at S&P Global is £45K per year.
$120K (Median Total Pay)
The estimated total pay range for a Analyst at KKR is $99K–$148K per year, which includes base salary and additional pay.
Is private equity a stressful job?
In private equity, you'll also be responsible for a lot of different tasks. The deal teams are lean and your decisions will have a high degree of permanence, which is why I'd say the stress level is overall higher in private equity than in banking. Very importantly, there's also no one around to check your work.
Working at a Private Equity Firm
The private equity business attracts some of the best in corporate America, including top performers from Fortune 500 companies and elite management consulting firms.
You can also take courses or attend industry conferences to build your network and learn more about the private equity industry. Additionally, you can gain relevant experience by working in the finance industry or completing internships with private equity firms.
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%.
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.
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.
Those who wish to broaden their horizons or simply desire a change of pace will often migrate to similar sectors such as hedge funds or portfolio management. Additional exit options include: Being hired as a chief analyst by another firm. Starting a new private equity organisation.
| Annual Salary | Monthly Pay | |
|---|---|---|
| Top Earners | $123,000 | $10,250 |
| 75th Percentile | $104,500 | $8,708 |
| Average | $91,602 | $7,633 |
| 25th Percentile | $79,000 | $6,583 |
Trips are usually shorter and more frequent, which means that you will probably spend more nights home but you may end up more tired. Work/life balance. In strategy consulting, you should expect to work relatively hard but the workload tends to be relatively smooth over time.
As for hours, both private equity and investment banking can be demanding careers. However, investment bankers tend to work longer hours, often working late into the night and on weekends. Private equity firms also tend to have a more relaxed work environment and offer more flexible hours.
Why does private equity pay so much?
Investment bankers make money by advising companies, structuring sales, raising capital, and taking a percentage fee on each transaction. By contrast, private equity firms make money by exiting their investments. They try to sell the companies at a much higher price than what they paid for them.
| Annual Salary | Weekly Pay | |
|---|---|---|
| Top Earners | $241,298 | $4,640 |
| 75th Percentile | $187,500 | $3,605 |
| Average | $143,004 | $2,750 |
| 25th Percentile | $113,500 | $2,182 |
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.)
Private equity firms are paid based on how much profit they can generate from their investments. They are given a portion of this profit, which is known as “carry”. The thing is, most associates don't get carry. At mega funds, it's essentially unheard of, and even at sub $1B funds, fewer than 1/5 of people get carry.
$162K (Median Total Pay)
The average Private Equity Associate base salary at EY is $133K per year.
