Private Equity Careers Guide: Career Path, Salaries, Lifestyle (2024)

An Overview of What A Career In Private Equity Is Like, Including Career Path, Salaries, Lifestyle and Work Product

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Why A Career In Private Equity?

If you got the “Why private equity?” question in an interview, you’d probably say that you love investing and operations, and you want to build value for companies over the long term.

But in real life, most people are drawn to private equity because it offers high compensation, somewhat better hours than investment banking, and more interesting work.

Some people also enjoy the excitement of working on large deals and interacting with “the best and brightest,” as well as understanding company operations in more depth.

In this article we’ll explore what it’s really like in a career in private equity.

What Do You Actually Do In A Private Equity Job?

Private equity firms raise capital from outside investors, called Limited Partners (LP), and then use this capital to buy companies, operate and improve them, and then sell them to realize a return on their investment.

The industry is called “private” equity because the companies that private equity firms invest in are private initially, or become private as a result of the investment.

The job is part fundraising, part operational management, and part investing.

The private equity career path attracts people who are:

  • Competitive, high achievers who are willing to work long, grinding hours.
  • Extremely attentive to detail.
  • Interested in deals rather than simply following the markets or investing in public companies or other assets.
  • Interested in investing and operations and using critical thinking to evaluate companies rather than selling or being an agent.
  • Interested in long-term projects such as building a portfolio company over many years, and are also open to non-deal work, such as company monitoring and fundraising.

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The Private Equity Career Path

The private equity career path and hierarchy vary from firm to firm, but here’s a representative example:

  • Private Equity Analyst – Logistical Monkey
  • Associate (Pre-MBA) – Deal and Analytical Monkey
  • Senior Associate – More Experienced Monkey
  • Vice President – Manager of Deals
  • Director or Principal – Generator and Negotiator of Deals
  • Managing Director or Partner – Rainmaker, Fundraiser, and Chief Representative.

And here’s a flow-chart summary:

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Unlike other industries such as investment banking, where professionals will typically pursue “Exit Opportunities” into other fields, Private Equity is often seen as an exit opportunity.

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Private equity professionals earn well – especially at the upper echelons. Here’s a summary of what to expect at each level in a front-office role at a big firm in North America (pay will typically be lower in other countries):

Position TitleTypical Age RangeBase Salary + Bonus (USD)CarryTime for Promotion to Next Level
Analyst22-25$100-$150KUnlikely2-3 years
Associate24-28$150-$300KUnlikely2-3 years
Senior Associate26-32$250-$400KSmall2-3 years
Vice President (VP)30-35$350-$500KGrowing3-4 years
Director or Principal33-39$500-$800KLarge3-4 years
Managing Director (MD) or Partner36+$700-$2MVery LargeN/A

For more details, see our article on private equity salaries, bonuses, and carried interest (carry).

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How to Get a Job in Private Equity

To get into private equity, you’ll need:

  1. A sequence of highly relevant work experience, including transactions and financial modeling.
  2. Top academic credentials (grades, test scores, and university reputation);
  3. A lot of networking and interview preparation;
  4. Something “interesting” that makes you appear to be a human rather than a robot;
  5. The ability to think critically about companies and investments rather than just “selling” them.
  6. A strong cultural fit with the firm – PE firms are much smaller than banks, so “fit” and soft skills are even more important.

For more, see our comprehensive guide on How To Get Into Private Equity.

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Private equity is a highly competitive and sought-after field. PE firms are small, tight-knit, and full of extremely smart and highly motivated people.

As a starting point, the right career background is critical. Overwhelmingly, PE firms hire people with experience working for top investment banks, and sometimes those with consulting, Big 4 transaction services, or related deal/valuation experience (e.g., corporate development at a normal company).

That said, firms expect new hires to hit the ground running with usable skills. And if you want to be competitive in interviews, you need to be well-versed in explaining your deal/client experience and answering technical questions and case studies.

Some of the courses offered by Mergers & Inquisitions and Breaking Into Wall Street that will help you win private equity roles include:

  • Investment Banking Interview Guide – Includes a 120-page guide to LBO modeling and 4 practice LBO case studies/modeling tests
  • BIWS Premium – This course includes more in-depth LBO case studies and coverage of foundational financial modeling skills
  • Advanced Financial Modeling – This features our most advanced LBO model (stub periods, dividend recap, OID, working capital adjustments, etc.) and an open-ended, “take home” private equity case study
  • Venture Capital & Growth Equity Modeling – This one is highly relevant for roles investing in earlier-stage companies, where knowledge of cap tables and granular financial models is essential

Completing these courses will help you win interviews and job offers for roles that pay $150K+ and position you for careers in private equity.

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Private Equity Careers Guide: Career Path, Salaries, Lifestyle (2024)


Is private equity a stressful career? ›

but nowhere near as much as in management consulting. While the travel will be less, the work in private equity is very stressful and demanding, so the hours you actually spend working may be more stressful or mentally demanding.

Why is it so hard to get a job in private equity? ›

Landing a career in private equity is very difficult because there are few jobs on the market in this profession and so it can be very competitive. Coming into private equity with no experience is impossible, so finding an internship or having previous experience in a related field is highly recommended.

Do private equity jobs pay well? ›

For the vast majority of first-year private equity associates, the base salary is around $135k to $155k. Then, based on fund performance, bonuses tend to range from 100% to 150% of the base salary.

Is private equity harder than banking? ›

Both investment banking and private equity are demanding careers that require long working hours, although private equity firms tend to have a more relaxed work environment and offer a more flexible schedule.

How much do KKR PE associates make? ›

$218K (Median Total Pay)

The estimated total pay range for a Private Equity Associate at KKR is $169K–$285K per year, which includes base salary and additional pay.

What are the disadvantages of working in private equity? ›

Drawbacks / Disadvantages:

Still fairly long hours and an intense work environment, and significant travel may be required, especially as you advance. There may not be a clear path to advancement at your firm, depending on the firm's size and policies and your level.

How many hours a week do private equity work? ›

Private Equity Associate Lifestyle and Hours

At many smaller funds and middle-market funds, you can expect to work 60-70 hours per week, mostly on weekdays, with occasional weekend work when deals heat up.

Is private equity a prestigious career? ›

Working at a Private Equity Firm

The private equity business attracts some of the best in corporate America, including top performers from Fortune 500 companies and elite management consulting firms.

Is private equity a risky job? ›

Private equity funds are illiquid and are risky because of their high use of debt; furthermore, once investors have turned their money over to the fund, they have no say in how it's managed. In compensation for these terms, investors should expect a high rate of return.

Can you get into PE without IB experience? ›

While investment banking is by far the most common training ground for private equity, it is also possible to recruit for private equity roles after doing entry-level consulting, especially if you are a top performer at a top management consulting firm.

Is CFA worth it for private equity? ›

Once again, the CFA also ranks relatively high in the alternative investment sector. 22% of asset management professionals on the database have studied the CFA, and this figure is 18% in private equity. A lot of limited partner private equity firms will hire undergraduates and then put them through the CFA.

How much does a VP in private equity make? ›

Private Equity Vice President Salary in California
Annual SalaryHourly Wage
Top Earners$241,298$116
75th Percentile$187,500$90
25th Percentile$113,500$55

What is the lowest salary in private equity? ›

The lowest salary for a Private Equity Associate in United States is $145,818 per year.

How much carry do PE partners get? ›

Carried interest can be very lucrative because the Partners at the PE firm might contribute only 1-5% of the fund's capital, but if it performs above the hurdle rate, they can claim 20% of the fund's profits.

What is private equity career path? ›

The Private Equity Career Path

Associate (Pre-MBA) – Deal and Analytical Monkey. Senior Associate – More Experienced Monkey. Vice President – Manager of Deals. Director or Principal – Generator and Negotiator of Deals. Managing Director or Partner – Rainmaker, Fundraiser, and Chief Representative.

Is private equity still a good career? ›

Compared to other jobs in the financial space, private equity roles can provide a more balanced lifestyle, potential for better pay and more engaging, connected work. Private equity is growing in popularity, and an increasing number of college graduates or financial professionals are looking to break into the space.

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