Working in the private equity industry is regarded as an honorable profession. Most of these positions require an advanced degree, such as an MBA, and are aimed at some of the most sophisticated investment minds — or at the very least, those with the most potential investment talent. Private equity jobs are most appealing when financial markets are active, and this segment of the financial sector is mature across developed economies around the world.
Large financial institutions employ many people in the financial services industry. Private equity firms, on the other hand, are frequently small, boutique businesses with a distinct corporate culture. As a result, these companies don’t tend to hire in large numbers, and job opportunities may be scarce. A managing director could be a newly hired investment professional. However, once hired, a private equity professional may benefit from working with more experienced colleagues and may be promoted to a more senior position, such as senior managing director.
The private equity sector makes money by buying undervalued companies outright or acquiring a stake in them, holding on to the investment for an average of five to seven years, improving the business operations in the meantime, and then selling the investment for a profit. Because of the sophisticated nature of the investment activity surrounding these transactions, private equity professionals are among the highest-paid financial professionals. Investment professionals may receive a yearly bonus or a percentage of completed deals in addition to their base salary.
The makeup of a buyout firm, another term for a private equity firm, affects the types of jobs available in private equity. There are companies that specialize in a specific industry, such as energy or technology. Although each investment or buyout is unique, there are times when the private equity firm’s investment professionals are called upon to assist in the turnaround of the investment’s business operations. These types of private equity jobs are highly specialized and necessitate that the investment professional has some knowledge of the industry in which they are investing.
Investment research jobs are also available in private equity. These professionals are responsible for vetting potential investment opportunities and monitoring the performance of the private equity firm’s current investments. Working in private equity research necessitates the ability to work autonomously while also communicating findings to the portfolio management team. Research jobs in private equity necessitate the ability to present opportunities to a firm’s board of directors and to communicate portfolio performance to investors verbally or in writing.