How I Skipped Investment Banking & Went Straight to PE

January 26, 2025

The Non-Target Playbook 

By Jack Kolb

Until a few years ago, you needed 2yr of investment banking to break into private equity.

This is because of the unmatched technical training you get with deal reps as a banking analyst.

But since banking has become so competitive and kids are getting that industry-specific training in college already, lots of PE firms are starting to hire straight from undergrad.

I was one of the lucky ones that benefitted from this.

I recruited for PE during my banking internship junior year and signed my offer at the end of summer.

By doing this, I chose to forego the typical “On-Cycle” private equity recruitment process.

On-Cycle involves the biggest PE funds using third-party “headhunters” to scope out kids from top banks just a couple weeks after starting their first analyst years.

The entire process of recruiting for PE is confusing, but it’s in your best interest to figure it out quick.

Even for Off-Cycle, you’ll start feeling behind if you don’t start prepping senior year of college.

Table of Contents 

  • On-Cycle vs Off-Cycle

  • How the On-Cycle Timeline Works

  • How I Chose to Skip Banking

On-Cycle vs Off-Cycle 

If you think banking recruitment is competitive, PE is on a whole other level.

The megafunds (ie. KKR, Blackstone, Carlyle, Apollo, etc.) all compete with each other to snag the most qualified candidates and don’t want to risk missing out by starting too late.

They now start On-Cycle over two years in advance.

My friends who just started their first analyst year in banking (August 2024) ended up signing offers for PE associate roles that will begin at the end of 2026.

If you don’t want to do On-Cycle, you can always recruit later in the less formal Off-Cycle process.

However, opportunities can be more limited with Off-Cycle.

This is why it’s important to understand the main differences between the two.

  • Difference #1 - Firm Size. On-Cycle is led by the megafunds. They fill ~80% of their 15 associate spots every year and leave a few for Off-Cycle.

  • Difference #2 - Headhunters. The first layer of screening for On-Cycle is done by third-party headhunter firms. They weed out the top kids before bringing them to the big shops for the more intense interviews. Examples of headhunter firms below.

  • Difference #3 - Timeline. On-Cycle has a rigid timeline with headhunter interviews starting during the first few weeks on the desk as a banking analyst. Off-Cycle has a more spread-out interview process that can last months.

On-Cycle Timeline 

Round 1 - Headhunter Meetings

I started getting headhunter emails during the second half of my banking internship.

PE firms end up owing them 30% of your associate salary for each placement.

Headhunter firms like Bellcast Partners and Amity Search Partners had info sessions with my school, but I signed my Off-Cycle offer before the headhunter “Mini-Interviews” even started.

These meetings / “Mini Interviews” start right as you begin your first analyst year in banking.

A couple tips.

  • Be Concrete. Headhunters force rank you for each fund they work for. Don’t be ambiguous with your future plans, even if you’re unsure. The more specific you can be on why you want a particular type of fund works to your advantage.

  • Take Each Interaction Seriously. Even an informal phone call should be treated as a job interview. It’s not likely you’ll get technicals, but have your behaviorals ready to go and a well-rehearsed answer to “Why PE?”.

Round 2 - Time-Pressured Modeling Test

These are case studies where you have to create an LBO model from scratch in a 1-3hr time window.

They’ll typically send it over email and ask you to send back what you have done when time is up.

The best way to practice is simply getting reps.

Here’s a Mergers & Inquisitions article with a great example.

Round 3 - Networking Events

If you make it to this stage, they’ll start having social events like breakfasts and dinners.

This is where you show your social ability.

Round 4 - Final 72 HR

I haven’t been through the final 72hr of On-Cycle, but I’ve heard it’s an absolute nightmare.

You’ll be running around town with back to back interviews, some which last till 1 or 2 in the morning.

Some of my friends got interview invite texts with less than an hour heads up.

These will be a mix of case studies, behaviorals and modeling tests.

How I Chose to Skip Banking

Going straight to PE from undergrad can destroy your long term optionality.

It was a difficult decision, but there were a couple reasons I knew it was the right move for me.

Reason 1 - Deal Flow

The reason you get so far ahead doing two years in banking is because you get a high number of reps closing deals.

A lot of PE shops don’t have the volume of deals coming through to get you that same number of reps in those first couple years out of school.

Then you get stuck spending time cold calling to try to source deals, which can put you far behind your peers in banking.

Knowing this, it was something I asked tons of questions about during interviews.

What made me comfortable was learning that the firm I signed at mostly used buyside brokers to source deals, meaning that I would be spending most of my time actually analyzing and closing deals.

With a junior team of ~5, they were closing almost 30 deals a year so I knew I’d be getting my reps in.

Reason 2 - Passion for Middle Market

Choosing to go to a middle market shop meant that all my future opportunities would probably also be limited to the middle market.

This didn't worry me at all though because of how much conviction I had around the fact that the small, family-owned businesses are what excited me the most.

I grew up in a small town with my dad running his own business and think there's just so much more opportunity to help these non-professionalized businesses, lots of which don't even have a website yet.

Investing in the bigger, well known companies like they do at larger firms didn’t excite me as much and I was okay limiting my options in that way.

Plan Your Exit

Some people are bankers for life, but an overwhelming majority leave after 2yr.

Network with as many alum as you can across all the most common exit opps.

  • Private Equity

  • Venture Capital

  • Hedge Funds

  • Corporate Development

  • MBA

Those conversations will help you figure out what fits you best.

Deciding early is key so you can get ahead on prepping for the top roles in whichever path you choose.

Cheers 🥂

- Jack