GETTING A JOB IN PRIVATE EQUITY BEHIND-THE-SCENES INSIGHT INTO HOW PRIVATE EQUITY FIRMS HIRE BY BRIAN KORB AND AARON FINKEL

GETTING A JOB IN PRIVATE EQUITY BEHIND-THE-SCENES INSIGHT INTO HOW PRIVATE EQUITY FIRMS HIRE BY BRIAN KORB AND AARON FINKEL

Chapter I
GETTING STARTED
The private equity market has gone through a major transformation 
over the past two decades, with many of the most dramatic changes 
occurring over the past few years. As you are likely aware, you are 
attempting to enter one of the highest profi le sectors of the fi nancial 
markets—one that is wielding signifi cant infl uence on the economy 
while at the same time creating great wealth for its investors. The 
wealth that has been amassed has played a signifi cant role in increas-

ing the attractiveness of the sector and thereby further fueling the 
competitive environment to enter. This chapter begins with a brief 
overview of the current state of the private equity market giving par-

ticular attention to how recent changes have affected hiring. It also 
provides a basic introduction to private equity.
THE MARKET TODAY
Notwithstanding the 2008 credit crunch and general market turbulence, it’s safe to 
say that today’s private equity (PE) industry is still a major force in the fi nancial world 
and that it bears little resemblance to the fl edgling market of nearly 30 years ago when 
there were just a few practitioners. Perhaps nowhere is the magnitude of the indus-

try more apparent than in the size of today’s buyout funds. In 1980, Kohlberg Kravis 
Roberts & Co. (KKR) ran the world’s largest buyout fund at $135 million. In today’s 
buyout world, in which fi rms compete to one-up each other, $1 billion funds are com-

monplace and the $20 billion barrier has been broken.
The clout of individual PE fi rms was pointed out in more detail in a November 
2004 article in the Economist titled “The New Kings of Capitalism.” The article 
pointed out that The Blackstone Group alone had equity stakes in about 40 portfo-

lio companies which, combined, had over 300,000 employees and annual revenue

of more than $50 billion. If they were a single unit, the holdings would have made 
Blackstone one of the top 20 Fortune 500 fi rms.
In the same article, the Economist noted that in 2004, Texas Pacifi c Group’s portfolio 
companies had over 255,000 employees and revenue of $41 billion, while The Carlyle 
Group’s portfolio companies had 150,000 employees and revenue of $31 billion. With 
their recent deals, the portfolios of Blackstone, Texas Pacifi c Group (TPG), and Carlyle 
are even bigger and, along with Apollo Advisors LP, Bain Capital, Kohlberg Kravis 
Roberts & Co. (KKR), Warburg Pincus LLC, and others, are part of an elite group of 
funds that oversee billions of dollars of capital. Table 1.1 lists the largest PE-backed 
leveraged buyouts (LBOs) ever, in which many of these fi rms were participants. These 
funds are pioneers of the industry, and anyone looking to break into private equity must 

GETTING A JOB IN PRIVATE EQUITY BEHIND-THE-SCENES INSIGHT INTO HOW PRIVATE EQUITY FIRMS HIRE BY BRIAN KORB AND AARON FINKEL