CAREER IN PRIVATE EQUITY

Private Equity is the process wherein investors buy a stake or invest and take up a large stake in a company. One could enter into a career in private equity if one is a wealthy individual investor, or by working in investment banks, and other financial institutions that pool investments. There are also Private Equity players who invest in private companies. In return for this investment, the private equity player exact a price, a significant ownership of the company and seats on the board of directors. For the most part, venture capitalists focus on companies in the technology, medical and retail sectors. Private Equity raise money from institutional investors, state pension funds and high-net worth individuals, usually in the form of partnerships. The risks and rewards of venture capital investing can be extreme.

The Prospects

Private Equity firms are always looking for people. When a firm finds someone they really like, they can afford to hire them. The simple reason is that the “right” person will add a lot more value than they cost. One starts as an Associate with a private Equity firm, an investment bank and other financial institutions. The work would initially include researching and analyzing different businesses and working on various financial modeling for companies in which the firm would be investing. The individual will need to play a leading role in the firm’s investment effort from sourcing to execution. The associate will need to gain significant transactional experience working on active deals closely with the principals of the firm. After having passed this stage there are quite good chances of enhancement in position of an associate within the firm.

Some of the most popular Private Equity firms  are Kris Capital, Morgan Stanley, Standard Chartered, Tamasec, General Atlantic, Merill Lynch, Warbus Pinkus, Barclays Private Equity, UBS Private Equity.

Personality Traits

• Winning and strong personality
• Keen business judgment
• Spontaneous and alert
• Good listener
• Good reasoning capabilities
• Great time management

Salary

An associate would earn anything between Rs.3.50 Lac- 4 Lac per annum after which one can keep getting great appraisals within the firm depending on their contribution to the firm and also after some experience one is quite in demand in other investing organization as well. As your experience grows your earning capacity grows tremendously in this career. A partner in a firm could earn anything above Rs. 1 Crore per annum, depending on the organization one is attached to.
Study Routes

The right person for a Venture Capital firm can have almost any background and degrees ranging from Psychology to English, and industry experience from non-profit and government to management consulting, investment banking, business operations, and of course, entrepreneurial activities. It is however advisable to undertake an MBA and have keen interest in finance and business. If, one’s initial interest is quite strong in finance then it is advisable that at graduate level itself one starts molding themselves in the line of finance and business. One could do B Com Honors from a reputed college and then an MBA with finance as your specialization. In case, it is while undertaking your graduate degree that you feel your interest towards a career in Venture Capital is growing then one could finish their graduation and then proceed to undertake an MBA with finance as a specialization.

Study Route

Class XII in any stream
After Class XII a bachelor’s degree in any discipline or BBA.
Ideally the job requires a postgraduate degree or diploma in business administration (MBA) / Economics / commerce.
Sample PG Degrees / Diplomas in Business Administration –

• Indian Institute of Management Studies (IIM), Ahmedabad, Calcutta, Bangalore, Lucknow, Khozikhone,
• FMS, New Delhi
• XLRI, Jamshedpur
• Jamnalal Bajaj (JBIMS), Mumbai
• SP Jain, Mumbai
• Narsee Monjee Institute of Management Studies, Mumbai
• Symbiosis, Pune
• XIM, Bhubhaneshwar
• MDI, Gurgaon
• IMT, Ghaziabad
• IMI, New Delhi
• IIFT, New Delhi

After Graduation – A degree in subjects such as a BBA, economics, or commerce will also give you entry into a bank. However growth prospects are limited and a PG degree is necessary for timely promotions.
Sample BBA Degree Colleges –

• IIPM – present in New Delhi, Chennai, Mumbai, Hyderabad, Calcutta, Bangalore
• Sukhdev College
• Wigan & Leigh – present in New Delhi, Mumbai
• IILM – New Delhi, Gurgaon
• Rai University
• Amity

Colleges Overseas

US

• Kellogg School of Management
• The Hult International Business School
• The University of Tennessee
• The College of William and Mary
• Southern State University
• International Business College
• Carlos Albizu University
• Manhattan Institute of Management
• University of Washington Business School
• Harvard University
• Boston University

UK

• Regents Business School London
• Aston Business School
• Henley Management School
• Grafton College of Management Sciences
• Bournemouth Business School International
• London College of Law and Management
• Aberdeen Business School
• Hamilton College, London
• Kelvin Business School
• Silpa Business Training

Australia

• Murdoch Business School
• Carrick Institute of Education
• Sydney School of Business and Technology
• Le Cordon Bleu Australia
• The University of Western Australia

Source: Compass One

Date: 6th Jan., 2010

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