Understanding Private Equity and its Education

Getting into the private equity industry requires graduation in finance, experience through internship and investment banking. Earning a certification accelerates the career curve.

Chris Gilbert
6 min readMar 30, 2020


The private equity (PE) profession attracts the best and brightest in corporate America and elsewhere across the globe. Most of the top performers in finance see private equity as their destination career.

The main attraction is that the private equity industry is here to stay. PE firms are prepared for deals with or without a recession. PE is ready to deal with the risks.

To recap from the past, 2003–2007 is referred to as the golden age of 🔗private equity. In the wake of the collapse of the equity markets in 2000–2003, many investors had an early and profitable exit (M&As) from their outstanding commitments. There was a surge in the secondary market prompting new entrants into the market. By 2006, active portfolio management was very common. The evolution of the secondary market continued reflecting the maturation.

The most notable publicly disclosed secondary transactions occurred in companies like CalPERS, Ohio Bureau of Workers’ Compensation, MetLife, Bank of America, Mellon Financial Corporation, JP Morgan Chase, and many more.

Business-to-business software companies became the primary attractions as they are asset-light, need less capital, achieves rapid growth amidst a tough economy.

Fast forward to today, General partners are raising capital, ‘Dry powder’ to deploy in the next downturn (if it happens). The tech-focused dry powder has surged since 2016, totaling up to $93.1 billion (Pitchbook). It has reached $1 trillion in 2018.

PE firms have realized technological ways to execute operating agendas by using Artificial Intelligence, Machine Learning, Robotics, and Automations. PE firms are investing a greater share of funds in technology and related sectors.

The push for operational excellence is becoming pronounced. Many of the top PE players have EBDITA growth, operating partners, external advisors, full-potential plans, new investment formats, intelligent offense, and, standard procedures. In brief, the building blocks of PE are high liquidity, stronger deals, operational performance, technology, format diversification, and intelligent offense.

“If you look at the last 5 years of private equity including 2018, they’ve been the best 5 years in aggregate the industry has ever seen — more exits by value, more value of deals done, more funds raised by dollar — a tremendous period of growth,” says Hugh MacArthur, Bain & Company’s head of global private equity.

Having said this, it is very clear why finance graduates including investment banking professionals look forward to gaining a 🔗career in private equity.

The private equity industry is socially acceptable and the public perceptions have improved. Many prominent PE deals are executed with an intention to create economic value for shareholders and the economy at large.

Some of the noticeable trends in private equity are

· The 🔗PE markets are going mainstream

· The industry experienced rapid development

· PE deal volume is surpassing its previous years’ records

Private equity and venture capital investments in the country touched USD 48 billion in 2019, as per EY reports. The outlook for 2020 is also optimistic.

Moreover, the exciting thing here is the PE industry is gaining traction in Texas, and in particular Austin. As a result, finance professionals are looking forward to joining one of the 🔗top private equity firms in Austin, Texas (Tx).

At this juncture, let us understand the functionalities of private equity, get introduced to the job profile and how to get into private equity.

👉PE functionalities

PE industries help sustain and build companies and increase their employment levels. PE professionals raise capital from outside investors — high net worth individuals or organizations. PE investment involves –

· acquirement of private companies

· turn around their business model and management and

· sell them for a profit after the hold period.

👉Job Profile of PE Professional

The 🔗private equity professionals get actively involved in forecasting financial projections, deal sourcing, conduction initial organization due diligence, reviewing legal documents, drafting presentations, calculating return rates, closing deals with coordinated funds flow. Moreover, they help in formulating company strategies, smoothening operations, preparing the company for sale, and developing quarterly financial reports.

👉Getting into PE Industry

The aspiring professionals must have passion for the work, grit, humility, and a lack of entitlement, says Vik Sawhney, Senior MD at the Blackstone Group.

🔗Private equity jobs are challenging and less in number. Securing a job in private equity needs due diligence. The candidates must hold a degree in finance, accounting, mathematics, statistics, or economics.

Many of the PE companies hire undergrads directly from the college (provided they have work experience in PE as in internships), MBA graduates, and professionals having experience in an investment bank for a minimum of 2 years.

Further, PE firms may not have in-house human resource personnel. Generally, they are dependent on third-party recruiting firms. The search firms handle everything that includes accepting resumes, screening, conducting initial interviews, background verification, drug testing, and any other formal requirements. The interview process may take a full year.

A few of the well-known PE headhunters include CPI, GloCap, SG Partners, Search One, and Oxbridge Group.

Internships are important as PE firms demand experience for their job openings. Having an internship at 🔗private equity, asset management, investment banking, or venture capital is highly appreciated. Candidates having financial-modeling skills and knowledge in corporate finance. They build candidates from here.

To get acquainted with the recent trends of the private equity space and gain the required competency, earning a private equity certification is highly recommended. One of the popular and renowned certifications is 🔗Chartered Private Equity Professional (CPEP™) provided by the 🔗United States Private Equity Council (USPEC).

👉The CPEP™ Advantage:

The CPEP™ program meets the 🔗USPEC standards, norms, benchmarks, knowledge-framework, and recommended for PE firms and professionals as well. The USPEC standards are backed by comprehensive technical and market studies, leading investors, chief investment officers, principals, asset managers, and other PE leaders.

CPEP™ as an industry-focused qualification accelerates the career growth of professionals in PE space and enables business students to start their 🔗PE career. The certification covers the more advanced managerial and technical aspects of PE business and functions.

👉The Bottom Line:

The work in the PE industry is satisfying and the reward is great. People love to work with companies, understand operations and close large deals. As you get engaged in deals, your zeal increases, you may advance your career and reach the top positions — Managing Director or Partner.

Starting with a summer internship, followed by 🔗PE certifications is the straight forward path to have a successful career in the industry.



Chris Gilbert

Senior Manager, Capital Markets - EY at EY