| Topic Name: |
Why a VC rush? |
| Message Name: |
Buyside Equity / Asst. PM |
| Date Posted: |
02/05/2002 |
| In Reply To: |
Okay guys,
I will throw you guys a bone and explain how this stuff really works. I was once an i-banking analyst myself at CSFB and now I work for a late stage VC/growth LBO fund.
The best background to get into private equity is almost always investment banking at the most junior levels. Generally junior people at these firms help with deal structuring, memo writing and modeling. The weight of modeling really depends on the maturity of the companies the shop invests in.
To get in you should really come from GS/MS/CSFB/Merrill/Lazard/Wasseralla/Salomon
JPM/Bear/Lehman analysts can sometimes have some success as well.
You must be a top ranking analyst in either M&A/Lev Fin or have very good deal experience.
At time we look at consultants but this is generally a more difficult way to get into PE/VC b/c they do not have as concrete financial skillsets.
Remember, as a junior employee, your job description will be a bit different than the general partners and hence you need certain skill sets.
As a senior staff member (post MBA) or partners, it is a completely different story. The partner group at these firms really do vary widely. They can be successful entrepr., ex-CEOs/COOs, Ex. Deal Guys, or Bankers. Remember, this is a very young industry, so the paradigm has shifted quite a bit.
To become a partner at a fund these days, the most predictable path would be to work at a Goldman M&A or the like, do two years a private equity fund and then go to either HBS or Stanford B-school. Then hopefully you will be hired into the senior staff ranks and work your way up.
Of course you could start a successful multi-million company or be a technology wiz/PHD from MIT, but thats a less predictable/pragmatic path.
If you have anything less than stellar Ibanking experience, or you are not tops in your class at McKinsey, BCG or Bain, your chances this year (in particular) are looking awefully grim.
Remember, there are very very few spots open each year and it is getting more competitive.
Yes, you may get very very lucky but try to set reasonable expectations.
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| Message: |
I have been a buyside equity analyst for four years and a PM for one with a bulge bracket asset manager, large and mid cap value funds specifically.
Completed MBA at top five school and would like to leverage this experience into a venture capital or LBO shop.
Which would be the path of least resistance in your view and what might be the perceived inefficiencies I should be prepared to explain during interviews? If you could mention a couple of pros and cons to public equity investing as a foundation for making this move I would appreciate it.
I'm 28 and would be looking for a post-MBA entry.
Thanks for your perspective.
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