KKR has quietly started hiring college seniors- we have the details, and what it says about how private equity is battling banks to fill six-figure jobs
- For the first time ever, private equity giant KKR is rolling out a formal analyst program that it will fill with college graduates.
- Many private equity firms traditionally only hired people after they spent a couple years honing their skills at investment banks. Hiring out of college puts PE head-to-head with banking.
- PE has been pushing to recruit earlier and earlier to battle fierce competition for young talent, both within the financial sector and from hot areas like tech.
KKR had tested out recruiting analysts straight from college in 2013 and made hires in 2014 and 2015, but it never had a formal program until now.More than a dozen people Business Insider interviewed over the past month, ranging from hiring executives at private equity firms, to financial industry recruiters and career advisers at business schools, all reported more resources being put toward college recruiting by private equity firms.That builds on a trend in recent years of private equity firms extending offers for associate-level positions to analysts at investment banks almost as soon as they start work after college, nearly two years ahead of their official start date, business school advisers said. Investment banks meanwhile have pushed back by making special efforts to retain talent, like promoting top analyst performers to the associate level earlier.
"It's really heated up," says Todd Carson, a career adviser at The Wharton School at the University of Pennsylvania. "They are identifying top students at Wharton undergrad, for example, and trying to recruit them right away, before letting them go to Goldman Sachs."
KKR said it has reached out to as many as 75 schools through a "variety of tools" to access candidates, though it did not specify how many schools it is visiting on-campus or which ones it has targeted. Starting next summer, analysts will get to work alongside KKR's lines of investment professionals in divisions they selected in their applications, spanning across credit, real estate, infrastructure and private equity.Despite the ramped-up college outreach, private equity firms that already were hiring undergrads have not significantly expanded the size of their analyst programs, making them incredibly competitive for applicants.
Blackstone, which has had an analyst program since at least as far back as when its president Jon Gray joined the firm in 1992, has been attracting more undergrad applicants for a small pool of jobs. There, of the 23,991 applications lodged in 2019, only 90 people started as first-year analysts.
Blackstone says applications for its analyst program surged 61 percent between 2018 and 2019, and interest in their analyst program at the college level show no signs of abating for this year's round."We are going earlier and wider," says Paige Anderson, head of Human Resources at Blackstone. "We fundamentally believe that if we attract people at a college age and train them, we can develop them into great investors and great leaders in the firm."
Bain Capital, which staffs more than 1,000 people, first started college recruiting a little less than a decade ago - and this year is shaping up to be the busiest recruiting year yet, said Susan Levine, who oversees the firm's hiring in North America.Bain has already received as many as 450 applications for Bain's 2020 analyst program, quadruple the number of applications as the first year it started college hiring.
By October, Levine and about 15 of Bain's investment professionals will decide who will work as an analyst in North America after graduating next summer.Despite all the work, there will only be about five or six accepted. As for what it takes to stand out as a candidate?"We are looking for people to be very well-rounded," Levine said. "We aren't just looking for people who receive perfect grades or 800s on their SATs. In addition to looking at academic achievement, we are looking for people who have been leaders, who have participated in clubs, whether it is dance, sports or other activities. We also gravitate toward people who have done well in their community."
To be sure, many firms in the industry are sticking with the more traditional approach.
The Carlyle Group, for instance, recruits college students only rarely as investment analysts, but does recruit analysts for Washington, D.C.-based fund management and accounting roles.For those roles, it holds meet and greets with students at a range of schools, including George Mason, Virginia Tech, Howard University and William & Mary.
The goal is to inform a broader population of people about a possible career in private equity and let them know about Carlyle, which employs more than 1,775 people overall.
"What [we're] trying to do is develop and engage relationships and letting them know there is a potential here in the private equity, alternative asset management world," said James Cheribum, head of talent acquisition at the firm, about the D.C.-area outreach. "A world they don't perhaps know as well compared to the banks."Smaller firms also appear on college campuses, though their approach is more targeted. For example, Two Six Capital, a firm that seeks co-investments alongside private equity firms, seeks students in data science and engineering clubs at Ivy League schools, as well as Stanford and Berkeley.
"It should start moving more down market," he said.
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