Private Equity Career Opportunities
If you are in the financial or investment sector, you have likely considered a career in private equity. In this field, you will work alongside smart and determined colleagues, collaborate with big investors, and hone your financial and networking skills. Additionally, deals and transactions in this sector are often exciting, interesting, and can provide a sizable paycheck.
What Does Someone Do in a Private Equity Career?
In the field of private equity, you will work to secure outside investors in order to fund projects or purchase companies that can then be sold for a profit. This sector is titled this way because it invests in companies that are or will become private.
The investors that you seek out are referred to as Limited Partners and may come from the sources such as:
- Insurance firms
- Pension funds
- Family firms or offices
- Sovereign wealth fund
- Wealthy individuals
While the types of investments and firms may vary, these are the primary skills that you will need to fill in a private equity position:
- Strong academic preparation and superior credentials
- Able to network and cultivate relationships with potential investors and buyers
- Competitive and high-achieving in order to pursue and secure investments and deals
- Detail-oriented to ensure a secure and profitable deal
- Critical thinking applied to evaluating potential company purchases and investment deals
- Experience in financial modeling and transactions
- Strong set of soft skills in order to fit culturally into a small firm and attract investors
Level of Education for Private Equity Career
In order to secure a job in private equity, you will need a minimum of a Bachelor’s degree. Your coursework should include a strong foundation in mathematics courses, such as statistics, accounting, and economics. Additionally, this is a field in which the college or university that you attended will carry some weight; well-known, top institutions will be viewed more favorably by prospective employers, and they may have better networking and relationships with firms in order to get you in the door.
In some cases, you may choose to pursue an MBA, though this is not always required for a position in private equity. In fact, it can be more difficult to break into the private equity sector without having spent several years working as an analyst and associate in the private equity or investment sector prior to achieving your MBA. If you would like to secure an advanced degree, it is recommended that you do so after several years of experience in the field in order to already have your foot in the door and be able to transition into private equity.
Aside from an undergraduate degree, experience in the investment and private equity fields will be the most important prerequisite on your resume. Following graduation from a four-year program, you should move right into a work position as a summer analyst in order to gain experience and possibly an in at the firm for a full-time role. You can then move to another company or continue climbing the ladder in that organization in order to further build your resume.
Private Equity Career Outlook
Salary information and career opportunities can vary for those in private equity based on your position within the firm and the geographical area in which you work. While specific data for private equity is not available per the US Bureau of Labor Statistics [https://www.bls.gov/oes/current/oes132098.htm], financial specialists in investments have a median salary of about $95,000. However, those who have worked their way up through the ranks of the firm can typically expect compensation to increase significantly as well.
While you can work in private equity anywhere in the country, as well as around the world, some states provide better job prospects and salaries than others. California, Texas, and New York are the top states for those in the financial sector, with the latter providing the highest average compensation. These states have large cities and populations that create more of an opportunity for private equity firms and deals to be successful.
The outlook for those searching for jobs in the financial sector is good. The U.S. Bureau of Labor Statistics predicts that the increase in opportunities for employment for this field is above average growth across all careers. While this data will vary based on the location of the firm, the opportunities for investments in the area, and the need for additional personnel or private equity firms, it is encouraging for those looking to enter or advance in the field.