PE firms rush to recruit young bankers
They finished college last spring and now count off the days spent toiling as junior investment bankers – while dreaming about landing a job at a private equity firm. Yet, they may be offered their fantasy PE job sooner than expected.
Currently, a mad scramble is taking place at well-known PE firms such as Apollo Global Management, Bain Capital, the Blackstone Group and the Carlyle Group to lure the young analysts. On a recent weekend, many went through multiple interviews and now are getting offers for jobs. One problem: the jobs will not start for 18 months.
The rush to recruit these recent grads has gotten more intense since the economic recovery, according to a report from The New York Times. That means interviews fall far earlier. Golden Gate Capital, a PE firm based in San Francisco, and Advent International, based in Boston, both held interviews earlier this year than their rivals. The better-known firms followed. Recruiters crammed interviews into the single weekend, and the applicants will likely respond to offers quickly.
No matter how unpleasant the process, they are drawn by an impressive salary. A PE associate may take home up to $300,000 a year, including salary and bonus, The Times reports. The lucrative amounts are getting noticed. Vettery reported in December that some 36% of junior bankers with two-year contracts in 2012 left for PE firms. On the other hand, 27.5% opted to remain in the same division where they likely began working out of college, Vettery adds. To prevent their early exit, investment banks are offering higher salaries or giving them more days off, The Times said.
But they are leaving. Long Ridge Partners shows in a recent survey of some 100 investment banking analysts that 39% want to be at a PE firm after leaving their current position. Some 37% want to work at a hedge fund. FinAlternatives reported that 27 were in their first year as an investment analyst; 51 were in their second year; and 22 were in their third year.
They clearly have ambition and drive, but one clear question is what do they know about Wall Street after just six months in a job?
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Quote of the Day
“Whatever you are, be a good one.” – Abraham Lincoln