Managing young private equity careers

So you want to get promoted, switch firms, or merely stick a foot in the door. Few buyout experts are more versed to discuss career management than recruiter Denise Palmieri of private equity recruiter Pinnacle Group International and Karen Beyer, VP of Human Resources at The Blackstone Group. The two discussed just that in a conversation moderated by David Toll, editor of Buyouts Magazine, at this morning’s Buyouts Madness event.

After determining that the Buyouts Madness audience was almost evenly split four ways among analysts, associates, those above associate level and those outside the buyout world, the ladies addressed what it takes to get ahead.

The take-away point was this: Buyout pros want the background of their new hires to look like their own backgrounds. Firms populated with former consultants are more likely to hire a consultant; firms whose partners tout MBAs will probably require the same of their fresh meat. Finding common ground is especially important for those entering the field from a nontraditional background, Palmieri said.

An MBA isn’t a must-have, she added. The degree opens some doors, and not having one closes others. But, she countered, “There’s a shoe for every foot.”

Though many firms hire associates with one to two years of investment banking or consulting experience, Blackstone hires some of its associates directly from undergrad, Beyer said. The firm’s New York office adds four or five new associates every year.

About 80 percent of private equity jobs are filled through personal connections—Palmieri stressed the importance of networking in one’s job hunt. Firms hire for two reasons: either they’ve raised more money, or an employee has left, and job hunters get access to info about those vacancies or fundraising sprees through their industry connections.

The number of jobs filled by recruiters like Palmieri hasn’t dwindled since the onset of the credit crunch, she said. However, with lay-offs from investment banks expected to increase, she expects competition for junior level positions in buyout-land to increase.

What does it take to beat the competition? Beyer said Blackstone focuses not on experience, but maturity, critical thinking skills, and the ability to articulate those critical thoughts. “We assume people coming in have the analytical and technical skills,” she said. “People that stand out can talk about the pros and cons of investing in a certain company, versus someone who has to be led through the process,” she added.

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