What does a Private Equity Associate do?
Private equity associates use a background in finance and knowledge of market conditions to make determinations about business acquisitions. They review marketing documents on companies that are for sale, make determinations about which companies make sense for a client's private equity portfolio, analyze company financials to ensure they are in-line with investor goals and pitch ideas to private equity investors.
Working as a Private Equity Associate
The main responsibilities of a private equity associate include:
- Learning whether companies for sale are viable for a private equity portfolio.
- Networking and introducing themselves to new business prospects.
- Analyzing the financial standing of companies within a given private equity portfolio.
- Scrutinizing the financials of potential business acquisitions.
- Making recommendations to private equity investors about the best way to use their resources.
- Analyzing all aspects of a potential business acquisition, including things like operations.
- Performing extensive market research.
How much does a Private Equity Associate make in the United States?
Frequently asked questions
What is private equity?
Private equity is a term in investment banking used to describe the act of investing capital into businesses that are projected to grow and increase the value of an investment. Private equity capital is placed into a fund by business investors and private equity associates are responsible for managing the fund and making strategic investments that make sense for the portfolio.
What are the benefits of private equity investing?
Private equity provides a potentially high benefit to investors who expect to see returns on their initial investment. It helps businesses grow, by offering them capital and resources of the private equity firm. When businesses grow, that helps the local community by creating jobs and providing more resources.
What is a portfolio company?
The term portfolio company refers to companies that receive private equity funds and resources in exchange for becoming part of an investment firm's portfolio. This is the transaction that drives the private equity process and allows businesses to grow and investors to seek returns.