Getting from McKinsey to Private Equity

Question

I am an incoming BA at McKinsey in a large US office (Chicago, Boston, etc). I chose to join the Digital practice since I wanted to do some technology work.

After some time at McKinsey (perhaps after a sponsored MBA), I would like to enter PE, ideally related to technology. However, I studied engineering as an undergraduate and don't know anything about finance.

While I know I'll be able to do plenty of non-digital work as a BA, I'm wondering how many opportunities I'll have to work in PE. I don't know any finance or accounting, so will the firm teach me all of these things if I want to do a PE diligence case? Or would they expect I already know it?

Answer 1

Hello!

Congrats on the offer!

Entering PE after a carreer of 2-3 years in McKinsey USA as a BA is something that many people do, so it´s easy if you follow the right path.

Actually, I know a person who worked with me in DD in 2017 who did precisely this in the US.

What you need to do is to make contacts in the PE practice asap, to ensure to be staffed in as many projects as posible. The way to do this is to find your first project in PE and ensure you rock it, to build a good relationship with the partners. Once you have achieved this, things will be easier, since all you need to need is express your interest in continuing your carreer in the practice and they will staff you.

However, bear in mind that PE and DDs are actually challenging and exhausting cases, you can´t do too many of those in a row without having a burnout.

Hope it helps!

Cheers,

Clara

Answer 2

Hi there,

This is not only applicable to McK but also other firms. But I want to manage your expectation given your description here.

(1) If you want to do PE ultimately, you need to try to get more involved in corporate development cases (i.e. DD) rather than Digital practice cases. Since you would join in the Digital practice, you need to make deliberate efforts internally to get yourself the right exposure, you cannot just wait for staffing to make all the decisions for you

(2) It is easier to join PE earlier in your career than later, i.e. easier to join as an experienced BA or junior associate, compared to when you get to more senior level. If you get a sponsored MBA, you are expected to stay for 2 years to "payback" to the firm. So you need to take that into consideration

(3) You better start learning Finance and Accounting. Don't count on the firm to teach you on the case. DD is short and super stressful engagement. If you don't know any finance and accounting, you become a liability to the team rather than a help. So you are very unlikely to be chosen to be in the team. Even if the team have to take you due to shortage of resources, they won't have much time and bandwidth to handhold you. And if you blow up once, you are unlikely to be picked again.

Best,

Emily

Answer 3

Hi,

Several points here:

It's extremely hard to get the job in PE post MBA (the number of offers is lower than the number of candidates with pre-MBA PE background
It's much easier for ex-consultants to get operational roles in PEs than investment roles. But even ops roles are hard to get
After a sponsored MBA you have to stay for 2 years to pay back
You have to learn finance and valuation if you want to work there. No one will teach you
you should better get some DD experience right now at McKinsey. try to get staffed on these projects

Best

Answer 4

Hi There,

Entering the PE market is difficult, but for sure after an MBA in top10 business school in USA and an experience in McK you will increase definitely the chance.There are few open poisitions in PE firms and maybe an expertise in digital, does not help as much in most of the companies.

So I would suggest to:

Move in the PE/Ring Fence industry in Mck. It is the best way to understand how PE works and networking with PE firms.
Apply for MBA in one of top10 business school (Wharton, Harvard, Columbia, etc..) and for sure you will drastically increase your chance.

Very good luck and for further clarification do not hesitate to contact me in private

Answer 5

Hi A,

In general, PE firm recruiting from top consulting firms including McKinsey, as well as from Investment Banking background. However, one of the prerequisites for being recruited is that you already have relevant experience. Don't expect PE firm will teach you any basics in finance. So by the time of your application you have to prove your finance skills (in a parallel you can do a CFA being a business analyst) and ideally have been completed a couple of due-diligence projects with McKinsey. These are key requirements to be selected and invited to the PE firm.

Best,
André

Answer 6

Hi, it is feasible and actually Mck consultants are super appreciated. However, you should arrive prepared on financial questions for the interview. There are lots of former colleagues in Private Equity and they can share with you tons of material for prep, it is totally feasible even if you know 0 today about it.

Best

Antonello