PE Recruiting For Non-Targets
With the PE recruiting process ramping up for IB analysts, I was curious to know some people's experiences with going through the process coming from a non-target undergrad. I managed to earn a solid GPA at a top 60 undergrad state school (think Penn State / Ohio State) and currently work FT in a BB bank.
I know there are a lot of sarcastic comments on here about "Ivy league or bust" but how much of a role does where you went to undergrad actually come into play for PE recruiting?
This is not going to be a perfect answer. Generally speaking, megafunds are going to fill their associate classes primarily with the 3.8+ Ivy kids.
It's a simple and unkind fact that people rely on processes that have been reinforced over time. In this case, private equity firms have been using headhunters for decades. Those headhunter firms are almost invariably founded by good-looking, well-educated women from socially connected families.
That's a fancy way of saying 'woman who was born into non-trivial economic means, enjoyed elite private school and college education, worked at some firm with a prominent name that didn't require her to kill herself, and is from the same social set as the guys who founded or run the firms that need the candidates'.
Today a lot of the top headhunter firms have younger employees that are women who did a banking analyst stint out of school. That means that there's a non-trivial chance that some analysts going through recruiting are socially proximate to that junior headhunter through siblings, sports teams, country clubs, summer vacation spots, and the like.
What I'm saying is that there's a whole host of qualitative, non-quantifiable elements that put the banking analyst from a non-target at a disadvantage. Yes, there will be some who find that they don't have too much trouble getting interviews. Anecdotally (this is thinking through over 100 guys from my summer or analyst class at the banks I worked at), the non-target ones who did well tended to be guys who most closely hewed to that sort of profile. Meaning they were tall, good-looking guys with strong social skills who come across well in an informal chat. They looked the part, even if they weren't born into the part.
Whether that's fair or not isn't the focus. I'm stating what I observed.
People are lazy and tend to stick with (a) the thing that works and (b) the people that seem to deserve it the most. Since we all as humans suffer from biases, we tend to think the most worthy people are those who most closely resembles ourselves.
For megafunds, that's the kid that looks like the tried-and-true, well-proven archetype of high grades from an elite school. For middle market funds (especially in regional cities), it's probably a kid with top grades from a flagship state school ("public Ivy"). And so on and so forth down the line.
This doesn't mean you shouldn't cast your net far and wide. It's merely an explanation for why the sorting hat works the way it does.