In private equity, b-school is no longer a must have

Business school remains important for candidates looking to get a private equity job, but the industry has become more flexible and the MBA is not the requirement it once was.

That was the consensus of executives speaking at the second annual Women Alternatives Career Forum on Nov. 6 in New York.

Michelle Creed, a managing director at Landmark Partners, said candidates can use an MBA as a “wildcard way” to pivot their career into private equity.

Creed, who attended Wharton School at the University of Pennsylvania, said Landmark still views the MBA as important when hiring at the senior associate level. The real estate industry, specifically the real estate private equity sector, looks at business school differently, said Creed, who spoke on the panel “Exploring the Continuum in Alternative Investments – Investment Management.”

B-school provides managerial expertise but “the skills in an MBA, from a technical standpoint, aren’t going to carry you through,” Creed said. “Looking more from the technical side, the CFA [chartered financial analyst] might actually be something that could be more impactful as you move forward in your career.”

Business school can help build confidence in executives, especially by polishing public speaking and presentation skills, said panelist Julia Kahr, a senior managing director in the corporate private equity group at Blackstone. Kahr said she has seen many candidates return from b-school completely changed and “almost a different person.”

For the most part, “people have MBAs,” Kahr said, but there are still executives in PE “who are super-charged, who go straight through” and do not have the degree. “In private equity, business school is not a must,” Kahr said to a room filled with PE executives, as well as college and business school students.

Kahr, who attended Harvard Business School, views the graduate degree as a way to better yourself. “You become a better investment professional, a more confident person,” she said.

However, not everyone who has succeeded in PE has an MBA. Panelist Kelly Ford, a partner at Edison Partners, didn’t attend business school but gained entry into PE as an operator. Ford is a former managing director of Oriel, an ex-director in product marketing at Groove Networks and a former senior manager of IBM/Lotus, according to her LinkedIn profile.

Ford, who calls herself a “go-to-marketer turned growth equity investor,” brought skills to Edison that the firm needed, while they had experiences she lacked. It was a partnership from the beginning, she said.

“I’ve never felt ‘less than’ or that I didn’t have something that others had because I have so much; I had something that others didn’t have,’” Ford said. “I focused on my strengths… Sometimes, this industry is not viewed as a team sport. I only know how to work as a team from an operating background.”

The Women’s Association of Venture & Equity (WAVE) founded the Women’s Alternative Career forum in 2017 to help address the dearth of women in private equity. The daylong event featured morning panels and an afternoon career expo. More than 400 candidates, from over 50 different institutions, applied to take part in the job fair.

Women continue to be under-represented in PE. Female executives make up a mere 17.9 percent of the private equity industry and 20.5 percent of venture capital, according to a September 2017 report by Preqin.

When it comes to senior ranks, the percentage plummets further, with women making up only 9 percent of senior level PE execs and 11 percent of senior VC execs, said Preqin’s “Women in Alternative Assets” report.

Elizabeth Betten, managing director at Madison Dearborn Partners, said her biggest frustration is that some women are not interviewing for PE roles. “They’re not even throwing their hat into the ring,” Betten said. “The biggest mistake is that you’re just not putting yourself out there. If you have an interest [in PE], go for it. That’s the biggest thing.”

Betten noted that there is a misperception surrounding the industry. Candidates sometimes think they need PE experience to get a job in private equity. “Firms, including ours, are now much more flexible. We’re just looking for the best applicant,” she said.

Action Item: For more information on the conference, contact Danielle Frasier, WAVE coordinator at wavecoordinator@gmail.com.