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February 22, 2018 No Comments Author: Andy Jones

How to Get a Job at an Investment Bank

Note: This article is for more junior people without previous investment banking experience. I may write a follow-up article for senior bankers looking to change firms.

For every available investment banking position, there are literally thousands of interested applicants. I have been fortunate enough to have worked as an investment banker at a bulge bracket firm, in the middle market and as an information provider to the industry through www.PrivateEquityInfo.com.

Upon completing business school, I had my share of investment banking interviews – Goldman Sachs, Deutche Bank, Bear Stearns and others. While I had multiple rounds of interviews with Goldman Sachs, they ultimately did not make me an offer. I did, however, receive and accept an offer from Bear Stearns, at the London office. While at Bear Stearns, I also participated in business school recruiting events for the firm. Because of these experiences, I have formed some views on how to increase your chances of landing a job at an investment bank.

The Right School

By far, the single best way to get your foot in the door is to attend one of the “right” universities, where “right” means one of the top finance schools. In the United States, the schools are (not necessarily in order):

February 15, 2018 No Comments Author: Andy Jones

Top 25 PE Firms Exiting Portfolio Companies

While it’s more common to study the most acquisitive private equity firms, I thought it might also be interesting to look at those firms with the most portfolio company exits in 2017.

The chart below shows the top 25 most active portfolio company sellers. Although they exited more portfolio companies than the other PE firms, these 25 firms were still net acquirers by a small margin (211 investments | 208 exits).

Top 25 Private Equity Firms Selling Portfolio Companies in 2017

February 13, 2018 No Comments Author: Andy Jones

PE Investments / Exits Ratio – Data Study

Using our M&A research database at www.PrivateEquityInfo.com, I studied private equity investments and exits for the years 2015, 2016 and 2017.

The ratio of the number of PE (Investments / Exits) over time, sliced by deal size shows a significant industry trend – private equity firms moving down market to focus on smaller deals.

Background

When the ratio of (Investments / Exits) = 1, private equity firms (in aggregate) are making one investment for every exit. This would be the “no growth” scenario. When the ratio is above 1.0, the private equity industry is a net acquirer of portfolio companies. This is the “growth” scenario.

The Data

For PE firms focused on Mid-, Large- and Mega-sized deals in 2015 – 2017, the (Investments / Exits) ratio was consistently about 2-to-1. Overall, private equity firms in these segments have been net acquirers of businesses over the past three years at the pace of roughly two portfolio company investments for each exit. This is no surprise as most people intuitively know private equity firms have become more prominent in recent years.

Size Ranges Defined (by Enterprise Value)

Small $0 – 50 million     Mid $50 – 250 million     Large $250 – 500 million     Mega $500+ million

 

Small Transactions

The same ratio for the PE firms focused on Small deals clearly illustrates that private equity has made a huge push into the lower middle market over the last two years. In the Smaller deal segment of the market, PE firms collectively made about 3-to-1 investments over exits in 2016 and 2017, compared to 2.3-to-1 in 2015.

Private Equity Investments / Exits Ratio (2015 - 2017)

 

The chart below is the exact same data, but with the bars re-arranged to group the years together.

February 08, 2018 2 Comments Author: Andy Jones

Most Active Private Equity Firms – 2017

The 25 most acquisitive private equity firms closed 14% of the total private equity investments in 2017. Interestingly, 50% of private equity investments were made by firms with only 1, 2 or 3 transactions for the year (compared to 60% in 2016).

25 Most Active Private Equity Firms in 2017

(in order of number of investments made)

  1. KKR & Co.
  2. Carlyle Group
  3. Insight Venture Partners
  4. Business Growth Fund
  5. EQT Partners
  6. General Atlantic
  7. Ardian
  8. TPG
  9. H.I.G. Capital
  10. Warburg Pincus
  11. Idinvest Partners
  12. CPP Investment Board
  13. L Catterton
  14. Bain Capital
  15. LDC
  16. Caisse de dépôt et placement du Québec
  17. Advent International
  18. Apax Partners
  19. TA Associates
  20. CVC Capital Partners
  21. Riverside Company, The
  22. Summit Partners
  23. Inflexion Private Equity
  24. Foresight Group
  25. New Mountain

Using www.PrivateEquityInfo.com as your M&A research tool ensures you include all the middle market firms in your marketing. This gives you greater coverage of the potential buyer universe and increases the odds of closing your deal.

February 06, 2018 No Comments Author: Andy Jones

Private Equity Moving Down Market

There are more private equity firms with more capital deployed (and waiting to be deployed) than ever before. Consequently, finding good target companies to acquire has become increasingly competitive.

To enter a less competitive deal space, many private equity firms have moved down market, showing an increased interest in middle market and lower mid-market companies. The rationale is that there would be fewer buy-side financial sponsors competing for the same deals because there is a larger pool of target companies (there are more mid-market companies than larger companies) and because traditionally, PE firms have been less focused on the lower end of the market.

This rationale may no longer hold. The Private Equity Info M&A research database now shows a substantial interest from financial sponsors across nearly all segments of the market – large and small. The database contains: