Private Equity Prowls for Young Bankers Early in Frenetic RitualIssue 09-11-17 |
In a race to get the best and brightest, the private equity recruiting season has started earlier than ever before. Junior analysts a few weeks on the job can now expect a flurry of emails from headhunters for some of the most prestigious private equity firms in the world. The jobs they’re being recruited for can pay more than $200,000 a year and won’t start until 2019. The battle to hire the best of them is fiercer and more urgent than ever. As a war for talent heats up in private equity, firms are raising record amounts of capital from investors starved for yield while competing for talent against rivals and Silicon Valley technology companies.
Why is this all happening? “Someone always gets nervous and starts recruiting first,” said Josh Grauer, a partner at Dynamics Search Partners. Interviews are accelerated, forcing candidates to make decisions in a matter of hours, not days. Susan Levine, the head of private equity recruiting in North America at Bain Capital, says, “Because the process is so frenetic it can sometimes be difficult for them to make thoughtful decisions.” With private equity shops poaching bankers earlier and earlier, the relationship with banks is becoming more strained, said Patrick Curtis, the founder of Wall Street Oasis, a job advice forum for the finance community. On the other hand, “Managing directors don’t want to make private equity unhappy,” said Curtis.
For investment banks, which have invested time and money in paying their junior analysts, this is not a very popular process. At Goldman Sachs, candidates have to be secretive about their job hunting. Some boutique banks, however, have gone so far as to brand themselves as a two-year training ground for lucrative private equity jobs, including recommendations for future jobs. “I’d like to think we’ve gotten to a point where it doesn’t get earlier,” Grauer said, adding that interviewees today don’t often know what they want professionally in the long term. “The days when they were able to talk about all their transactions are gone.”