Is CFA helpful to work in the private equity practice?

Question

It seems that the majority of private equity practice' works is CDD (commercial due diligence).

I'm wondering whether doing CFA is helpful if I want to work in this practice? Based on my understanding, CDD focuses on the “commercial” part, so CFA doesn't seem helpful.

I just want to make sure that I'm not wasting effort on not useful stuff. Thanks a ton!

Answer 1

Not necessary, but can be helpful if you already have it.

Answer 2

Hi,

I worked in BCG's PIPE practice. The CFA is not at all necessary for working on PE projects

The bulk of the work is CDD
You are right in the understanding that CDD focuses on Commercial aspect - i.e. from a business POV, is this a good investment or not
In CDDs we often also do a financial model - but the concepts there are really not rocket science and what makes the model a good model is more the logic and analytical thinking behind the numbers

Happy to answer any more specific questions you might have.

All the best!

Answer 3

Hello,

Fully agree with Pedro here - CFA is not necessary and doesn't really give you an advantage. Most of the work is CDD, as you point out, so as long as you can read and interpret financial statements, you're good.

Answer 4

It's not necessary, and it is not an advantage.

You need to understand financial statements, and that's it. You don't need much more than this.

Answer 5

Hi there!

It's not critical indeed.

Few of the people who do due diligence work in consulting have a CFA. So it's a nice to have and it will surely make you more valuable to the team, but it's not a must.

Best,
Cristian

Answer 6

Hi there,

not critical, and the majority of consultants in PE practices don't have it. If you consider only getting a CFA to land consulting jobs, I'd say the sustantial effort you have to put in to get it is not worth the impact.

CFA is more useful, if you plan to move on to an investment professional role in the future - for consulting it doesn't matter.

Hope this helps.

Regards, Andi

Answer 7

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