๐ญ. ๐ ๐ฎ๐ธ๐ฒ ๐๐๐ฟ๐ฒ ๐๐ผ๐ ๐ฎ๐ฐ๐๐๐ฎ๐น๐น๐ ๐๐ฎ๐ป๐ ๐ถ๐
Sounds obvious, but do you ๐ข๐ค๐ต๐ถ๐ข๐ญ๐ญ๐บ want it or just ๐ต๐ฉ๐ช๐ฏ๐ฌ you want it? Don't pursue it just b/c it's "awesome" or "prestigious".
The upside in private equity takes a ton of work, sweat, and sacrifice, especially early on.
๐putting my hand up — I struggled with this early on and learned the hard way.
Make sure you actually want it.
๐ฎ. ๐ฆ๐ต๐ฎ๐ฟ๐ฝ๐ฒ๐ป ๐๐ผ๐๐ฟ ๐๐ผ๐ณ๐ ๐๐ธ๐ถ๐น๐น๐
Wait, you don't just crank out LBO models??
Actually — private equity has a ton to do with relationships and people skills.
Especially when it comes to business owners and the private equity firm.
How's your conflict resolution? Ability to see both sides? Ability to educate?
What if the private equity firm wants to go one way but the CEO of the portfolio company wants to go another? ๐ค can you step in and help?
This is something you can start practicing at your current job today.
๐ฏ. ๐ง๐ฎ๐น๐ธ ๐๐ผ ๐ฒ๐ป๐๐ฟ๐ฒ๐ฝ๐ฟ๐ฒ๐ป๐ฒ๐๐ฟ๐
Where do you find them?
Walk into any business on the street.
Unless it's a larger chain, chances are it has one or two owners.
Ask them about their business — what inspired them? How's it going? What lessons have they learned?
These can be amazing conversations — art store, dry cleaner, car wash, restaurant, brewery.
Private equity requires an entrepreneurial mindset.
The more you talk to them, the more you learn.
๐ฐ. ๐๐ป๐ผ๐ ๐๐ผ๐๐ฟ ๐๐ฒ๐ฐ๐ต๐ป๐ถ๐ฐ๐ฎ๐น๐
Here it is, the "hard skill" piece.
Know how an LBO works. Good news, it's the same as buying a house.
๐ฑ. ๐๐๐ถ๐น๐ฑ ๐ฎ ๐บ๐ผ๐ฑ๐ฒ๐น (๐ฏ๐๐ ๐ฑ๐ผ๐ป'๐ ๐ผ๐ฏ๐๐ฒ๐๐)
You need to know the 3 statements and how to build an LBO model.
But seriously, don't go crazy here.
Get the concepts down and be prepared to do a "live test" during an interview.
This is critical though, ๐ฑ๐ผ๐ป'๐ ๐น๐ฒ๐ ๐ถ๐ ๐ฐ๐ผ๐ป๐๐๐บ๐ฒ ๐๐ผ๐.
Models have a way of doing that.
Remember the people skills and all that other stuff I mentioned? That's more important in the long run.
๐ฒ. ๐ฅ๐ฒ๐ฎ๐ฑ ๐ฏ๐ผ๐ผ๐ธ๐
Again, don't get lost here.
It's easy to get into "academic paralysis" and try to memorize everything.
Remember — big picture.
๐ณ. ๐๐ฒ ๐ฒ๐ฎ๐ด๐ฒ๐ฟ & ๐ต๐๐๐๐น๐ฒ
This is number 7 but really it should be toward the top.
No one expects you to know everything, and each firm does stuff their own way.
Show them:
— you're eager to learn
— you hustle
— you bring solutions (not problems)
— you find a way to get something done
Here's an amazing quote from one of my old partners:
"I don't give a sh*t about his [very prestigious] degree. I just care if he can get something done."
Pretty awesome.
—Chris
About Me -- I'm Chris. I help with M&A, FP&A, and teach financial modeling like a human, not a textbook. Here are the best ways I can help you:
- Learn the Basic 3 Statements
- Download my Advanced 3 Statement Model Template
- Learn to model like a Private Equity pro