How hard to study for PE interviews?

I'm approaching a year in to my M&A IB analyst role- I've recently started more seriously recruiting for buyside (growth) roles; I made it to the final round for my first process, but there wasn't a very deep modeling test or anything of that nature (they don't do LBOs).

I've studied PE prep materials in the background - standard modeling course that shall not be mentioned on this website up through level 5, and know how to speak intelligently to my deal experience at a high level (candidly haven't dug super deep in terms of being able to articulate margin profiles, complexion of various revenue streams, specifics of the vertical market focus, etc).

How deep do you need to go? A friend shared his prep from a year ago when he landed his offer and he had lots of materials around the technicals he got, deals he worked on down to the specifics, etc. It's just tough to find the time to do that in this job, but willing to if that is what it takes to get to the offer stage. My focus so far was just kind of like IB prep - standard technicals with added ability to know how to work through an excel and paper LBO.

 

Based on the most helpful WSO content, here's what you need to know about preparing for PE interviews:

  1. Depth of Preparation:

    • Technical Skills: While PE interviews may not always emphasize technical prowess as heavily as IB interviews, it's crucial to be well-versed in the technical aspects. This includes understanding LBO modeling, even if the specific role you're targeting doesn't focus on LBOs.
    • Deal Experience: You should be able to speak intelligently about your deal experience. This means not just knowing the high-level details but also being able to articulate specifics such as margin profiles, revenue streams, and vertical market focus.
  2. Study Materials:

    • PE Study Guides: Investing in comprehensive PE study guides, such as WSO’s PE study guide, is highly recommended. These guides can provide a structured approach to your preparation.
    • Research Reports: Read initiating coverage reports on companies involved in your deals and comprehensive research reports on the sub-industries. This will help you understand the context and specifics of your deals better.
  3. Interview Preparation:

    • Soft Interview Prep: Start with soft interview prep, which involves reflecting on your experiences and goals. This helps in presenting yourself effectively to headhunters and focusing your search.
    • Mock Interviews: Engage in mock interviews with colleagues or friends who have gone through the process. This can provide valuable insights and help you practice articulating your thoughts clearly.
  4. Networking:

    • Connections: Build strong relationships with your team and peers. They can provide guidance, share prep materials, and offer mock interviews.
    • Headhunters: Do not underestimate the role of headhunters. They can be crucial in getting you through the initial stages of the interview process.
  5. Time Management:

    • Balancing Work and Prep: Finding time to prepare while working in a demanding IB role can be challenging. Prioritize your preparation by breaking it down into manageable portions and focusing on the most critical areas first.
  6. Personality and Fit:

    • Cultural Fit: PE interviews often emphasize personality and cultural fit. Ensure you come across as humble, approachable, and someone who can work well in a team, especially during long hours.

In summary, while the depth of preparation can vary, being thorough in both technical skills and deal experience is essential. Utilize available resources, engage in mock interviews, and build strong networks to enhance your chances of success.

Sources: Basic Questions About PE Recruiting Answered, https://www.wallstreetoasis.com/forum/private-equity/on-cycle-recruiting-2018-what-to-expect?customgpt=1, Q&A: Career start and progression across IBD // Restructuring // PE special sits, Private Equity Interview Questions - 13 Topics to Know, PE Recruiting Guide

I'm an AI bot trained on the most helpful WSO content across 17+ years.
 

bump, would be incredibly helpful if someone could provide insight into how they prepared for the off-cycle process. Were you studying for an hour after work each day, etc. Any outline/guidance on how to stay interview ready while working is greatly appreciated!

 
Most Helpful

I did a lot of the prep work early on and got to the point where if I had an interview coming up, I only needed to do an hour or two of refreshing.

It’s very person-dependent, as I felt I am generally good out thinking through things on the spot and articulating my thoughts confidently.

So for me - my real prep was (1) Paper / Excel LBOs (2) Deal talk (3) Qualitative case studies / developing an investor framework (4) Accounting fundamentals and banking technicals

Early on I struggled the most with particularly 3 but also 2. But then I got thrown into the fire on some deals and developed ability to talk about the deal I was on, but also apply those learnings from the deal & what investors dug into towards the case studies.

1 & 4 are the easiest to prepare for but will need refreshing every once in a while, 2 and 3 pretty much stick once you get your framework down or have a similar experience to myself.

Lastly, always need to do a bunch of research on the firm beforehand (portco’s, their “edge”, mission statement, history, etc.). Demonstrating interest and backing it up with your knowledge helps immensely.

Obviously behaviorals are very important too, but I never prepared for these.

 

Summarizing my above thoughts, I did practice LBOs basically every opportunity I had every day until I was very comfortable (realistically probably 10-15 reps is all you need to get to that point). Technicals I had finance and accounting background, so just sprinkled these in occasionally. Deal talk and case studies honestly evolved over time as I had more interviews and practiced with other analysts. But talking through these out loud is most helpful.

Last thought - I’ve had multiple 1 hour interviews in the same super day that were solely deal talk, asking for details down to EBITDA adjustments, unit economics, de novo costs, % of revenue for each line item and how they change over time, returns analysis, as well as high level thoughts on growth strategy, risks and mitigants, etc… So I had to be able to speak to this level of detail for separate deals.

They can and generally will dig deep.

 

Last thought - I’ve had multiple 1 hour interviews in the same super day that were solely deal talk, asking for details down to EBITDA adjustments, unit economics, de novo costs, % of revenue for each line item and how they change over time, returns analysis, as well as high level thoughts on growth strategy, risks and mitigants, etc… So I had to be able to speak to this level of detail for separate deals.

They can and generally will dig deep.

Curious how you found the mental horsepower to memorize these stats for 4-5 deals amongst 100 hr work weeks. I built these models and know them well, but there is a level of brute force memorization for a 10+ cost driver model and doing this for multiple deals. Any advice? 

 

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