When I moved over to private equity from banking, one of the most appealing factors to me was the fact that in Private Equity, you are often a client of the ecosystem, rather than a facilitator. What I mean by this is that you aren’t in the middle-man role anymore, you aren’t serving anyone – you are getting served. This is important in my view for a few reasons. The first reason is that you get a high level of respect relative to your role on the sellside, even at a very junior level. I won’t be the first to say that there is a lot of disrespect at the cog-in-the-machine level in addition to inconsiderate attitudes when you are in banking. I remember an instance where I had to take a 10PM call with a client on Sunday because my MD was watching the NFL playoffs – I certainly was not a happy camper then.
Printing books, mailing wet-ink signatures, and getting no thank yous or any sort of acknowledgement was the norm during my stint in banking, and I can tell you frankly that it makes the job even more difficult, especially when you consider yourself a well-educated, ambitious person. You start to wonder why you even worked so hard in the first place to help with roles that quite literally anyone else could’ve done – I am not saying this was the entirety of banking, but it was definitely a lot more of it than I signed up for and a lot more than was advertised during my rosy summer internship… Given the regulated nature of the banks, there are very formal proceedings when it comes to anything legal or official in nature – this often means the analysts are tasked with dealing with these tasks and doing less modeling, financial analysis, and analytical work. In essence, about half of your job becomes about doing clerical tasks particularly if you were in a capital markets or debt role, like I was, so it is easy to see why this was a very important aspect of my move to private equity.
In private equity, you still have to deal with some of this but many times since you are the client, you often get bankers, external lawyers, internal legal teams, and other parties helping you out or going out of their way to assist you with these seemingly trivial parts of the job. Now, I understand there is always someone on the other side that has to do this role and of course feel bad but obviously it is nicer to be focused on actual, value-additive deal work than to be running around shipping pitch books across the country. This doesn’t mean you’ll fully be able to avoid all “administrative” work in private equity, however, having access to many resources from the perspective of a client significantly decreases the time spent and enhances your ability to cope with seemingly useless tasks – something very important to have a long and healthy career in private equity.
While the above experiences were focused around the negatives experienced while in banking, I want to highlight some of the non-work-related aspects of the private equity role that come with sitting in the shoes of a “client”. I was shocked at how much attention was given to junior folks in private equity roles when it came to working with third-parties. During my time in private equity, I have been inundated with emails and offers to be “wined and dined” for the prospect of considering a new product that my firm could potentially use. Yes, there a lot of nice meals and drinks that come as part of the job as part of the marketing ecosystem and while in banking you’d likely never get close to these opportunities, less hear about them, in private equity you become the target audience and even as a junior, you are valued-enough to enjoy the fruits of a fanciful dinner or a nice bottle of wine once in a while. I promise while it won’t make or break the job experience, it will definitely make it a lot easier on you when you get to live the high life once in a while.
Another big difference is your overall access to informational resources and the ability to get an answer quickly. In private equity, you can utilize a plethora of different resources and networks to get the answers you need and because you are a client of these various platforms (typically consultants, expert networks) you get shown how to maximize all of these resources and get prompt answers to your questions. My experience in banking was the polar opposite, someone would come to you with a vague question like “how is this market growing and how can we understand how this informs out model” and you would have to do primitive google searches to try and pluck out quoted growth rates in news articles that are based off of inaccessible research articles, which obviously your bank was too cheap to pay for to make your life easier. This resulted, in my opinion, in an absolutely terrible result that was extremely myopic and based on ease of reference. It also was a very inefficient process that required you to again, spend hours on menial work that could often be very quickly finished with access to the right set of resources. Private equity is on the right side of this equation, and I credit much of this to the fact that private equity firms are large, established clients of many parts of the financial ecosystem and are equipped with the understanding and financial resources to invest in quality resources to make the retrieval of information easier. Again, a major perk of being a client in my opinion.
I want to cap off this little rant by saying that while yes, it is a major benefit in terms of the experiences, resources, and kind of work you focus on that you are a client of the broader financial ecosystem, it doesn’t mean you are immune to inefficiency; I think you are just far better equipped to avoid it, and if you are like me and actually wanted to learn and grow in your role in finance, I think that private equity offers you a far superior way to do this, but take my opinions with a grain of salt, I was in a debt-facing, execution role at a very inefficient bank that loved to make everything harder than it needed to be – opinions and experiences may vary.