Private Equity Recruitment

I attended a seminar recently where Deborah Hannam presented to students on private equity sector recruitment. Deborah is head of private equity at The Rose Partnership and a member of the Institute’s Advisory Board.

http://www.rosepartnership.com/people.asp?pid=25

Private equity is certainly highly competitive and a difficult sector to get into but can be rewarding, both financially and intellectually, for those fortunate enough to join a successful firm.

It is interesting firstly to put the industry into perspective. Simplistically, private equity firms buy businesses and endeavour to sell them for a profit. To do this, they need to have identify the right businesses to buy, analyse the company in detail, decide on an appropriate valuation and if they are successful in bidding for the company (often this is in a competitive situation) they need to work with management in improving the performance of the company over the holding period and sell the company, hopefully for a handsome profit.

Private equity is not about sitting behind a spreadsheet and analysing numbers. Yes, financial skills are important but private equity firms need investment professionals who can build relationships at all levels (from board executives to managers of SMEs), exercise sound judgement on deal screening and investment decisions and very importantly to be highly passionate about the industry.

In her presentation, Deborah pointed to the following professional and personal qualities which PE firms look for in recruitment:

• Outstanding academic, career and personal achievements
• Sticking power
• Intellectual curiosity
• Depth of thought / analysis
• Strong judgement
• Logical and analytical mindset
• Conviction and courage
• Humility and ability to communicate with people at all levels

Private equity firms recruit people who will stay with the firm for the long haul. They want professionals who have the qualities to one day be partners of the firm.

If you are interested in moving into a PE firm and think you have the qualities in order to be successful, how can you get into the sector?

In her speech, Deborah Hannam drew on her 21 years of experience in executive recruitment to suggest some ways to access this opaque but lucrative industry. Firstly, you should know the industry inside out, having an understanding of the theoretical framework, the players in the market and industry dynamics. Noting that most PE firms do not recruit actively at any level except pre-MBA candidates, Deborah highlighted it is critical to be pro-active when looking to enter PE. Prospective private equity professionals should research the market thoroughly to look for any niche opportunities. For example, a firm may be focusing principally on renewable energy opportunities and may be looking for people with industry experience, not necessarily from a PE background. Other proactive measures include acting pre-emptively to present an investment to a PE fund and to write a case study on a particular acquisition or fund raising.

However, as always, networking is key and budding professionals should trawl through their rolodexes thoroughly to explore all avenues into the market.

If you have your own experiences to share, we welcome your comments to this blog. Also, if you are interested in recruiting any London Business School students for a permanent role, internship or for a student project, please contact our Career Services department at tlaurinaitis@london.edu.

Hans Holmen
Executive Director
Coller Institute of Private Equity