I understand that there has been quite a lot of hype about entering the Private Equity (PE) industry from what I can see from different forums. In this blog-post I would like to share some of my PE experience with other community members. I am a recent graduate based in Singapore, and I am currently working as a Product Manager with a private equity investment firm.
What do Private Equity product managers do?
We act as subject matter experts for the products that our firm covers. We take responsibilities for updating pitch books, filing and/or writing research articles about recent transactions in the PE industry (ensuring that it complies with the necessary legal frameworks as well) that we feel that will be relevant to know. When investors invest in our products (funds) they expect some sort of deliverables. Such deliverables may include monthly, quarterly or yearly reports which will allow them to understand what is happening to the fund. Contents may include:
- What are the portfolio drivers?
- Why is the fund doing well?
- Why is the fund not doing well?
- What can we expect from the outlook?
- What is the macroeconomic outlook for the geographical coverage of the product?
Product managers are the ones who write these reports and transaction descriptions to ensure that our investors are aware of what is happening to their investment. We are also one of the points of contact for investors, serving as investor relations for our clients and answering any questions they may have. Questions may be regarding the kind of fees they are paying, or calculation methodologies etc.
Day to day and why it is fascinating
There isn’t really a day to day routine here because our reports are sent out on the monthly, quarterly, or annual-basis. Unlike other roles that may seem relatively routine, our timeline is significantly longer. Day to day activities differ depending on which part of the reporting cycle we are in. I believe this is one of the most fascinating things about the job.
Another fascinating thing about my role is that we get exposure to a lot of companies and interesting trends in the industry. In my view, the importance of PE firms basically lies in their role to provide funding for private companies, which may have a sound business but the owners may lack the network for expansion or the knowledge to bring the company to the next level. We provide expertise and the know-how to make them more efficient and help them achieve their potential.
Interview process for the entry-level position in PE
I cannot get into great details regarding the interview process. Nonetheless, I will advise community members to have a good understanding of the PE industry in general, namely:
- Who are the key players?
- What is an LBO?
- How do valuation methodologies differ from your publicly listed asset classes?
- Outlook for the industry and some of your views about the industry
- You may be asked about recent deals and what you think about them
You are also expected to know the different kind of structures that exist in the industry, such as LP-GP relationships, SICAR, etc.
What does it take to be a good product manager?
I just started, so I am not going to pretend that I am an expert. But one of the commonalities that I have noticed between me and my colleagues is that we pay a lot of attention to the details. Since we are effectively client facing as well, we also need to have good oral and written communication skills.
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