Top ways MBA can helpful in the private equity careers

Private equity is considered an appealing career destination for several business professionals, offering high salaries, exciting travel opportunities, and the chance to be involved in the rise of the next large company.

PE firms hire people from all kinds of backgrounds, but people who hold MBA degrees are one of the most sought after because of their unique set of skills and their holistic understanding of business.

The bigger the firm, the higher the number of MBA holders. Here is a list of major PE firms and their MBA concentration, according to a data from Askivy:

• Permira (58%)

• Candover (59%)

• KKR (61%)

• Blackstone (63%)

• Apax (77%)

Let’s take a look at the need for an MBA to start your private equity careers.

Reach higher positions

If an individual’s aim is to advance in their private equity career then doing an MBA will highly improves the chances. Many PE firms tend to favor MBAs, and those without them will have a much harder time reaching senior positions.

Many junior PE professionals leave and get an MBA, come back, and end up in senior positions with other firms. There are people who get into PE firms with nothing but an associate’s degree, but if one wants to climb up the ranks then doing an MBA is considered most fruitful.

If one looks at trends across private equity firms, one will understand that the majority of executives have an MBA degree. The employees with the longest tenures in a PE firm also tend to have an MBA degree.

So, this is a great option if one wants to invest in their private equity career, an MBA degree will broaden the opportunities. Having an MBA will be helpful to get hired by one of the major firms, and most will view senior executive positions as post-MBA.

Advantage from experience

MBAs work on real-world case studies and also conduct consultancy projects. MBA students get a wider knowledge of different industries and functions.

“Getting my MBA allowed me to work with firms in all sorts of sectors,” said MBA graduate Humza Khan. He also stated that his MBA allowed him to work through digital disruption.

“I have a deep understanding of the tech market, and have worked with many tech companies now.”

This has been an issue with private equity firms for a while, with many thinking that the MBA had a tendency to produce students with a rigid mindset. But things have changed greatly, especially with the advent of online degrees.

Cross-cultural expertise

Another good thing about MBAs, especially about online MBAs in particular, is the cross-cultural expertise they bring to the table. MBAs are now more diverse than ever and offer students good exposure to people from various countries who possess knowledge of different market conditions, and who have faced different challenges. They also get into the inner workings of major corporations and attain a better experience of their corporate cultures and management methods.

But more importantly, being able to build these connections with people from around the world and across various other industries will give an individual the chance to build a strong network, which will be very helpful in one’s career. We never know what the future holds; one of your connections might become a private equity investor or might be able to facilitate deals in the future.

Having an MBA degree with a relevant certification will help to step up in an individual’s private equity career. One such certification is Chartered Private Equity Professional (CPEP™) from the United States Private Equity Council (USPEC), which offers better practical exposure and enhances one’s skills to be ready to enter a PE firm.

Many students learn about the latest tools and stay in touch with the current trends in technology and management. This helps students to gain better knowledge and experience on various technological aspects as well as to deal with disruptive forces across industries.

End Notes

With the aforementioned benefits, it can be said that doing an MBA benefits one’s career in the PE industry and also to grow more in their jobs. An MBA complemented with the right certification will drive an individual’s career in many ways.