Ex-banking private equity associate says the hours are down, intensity is up, work is fake

If you're wondering what it's like to leave a banking job and work in private equity in 2024 - presuming this is possible in the current environment - an anonymous Twitter account has some interesting insights. 

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Run by a former restructuring banker who moved into private equity in the past year, it offers a different take on the perennial issue of working hours in PE compared to banking. 

Yes, you will work less in private equity, says the banker. But the work will be qualitatively different. It will also be partly pointless. 

Speaking to us directly, the banker concerned said he now averages around 70 hours a week of work in his job as an associate in large cap private equity in the US. However, he says the work is "different" to banking. "While hours are generally more predictable, the intensity is much higher. There is never really downtime, there is always more to read, more data cuts to do, more changes to make, and more portco [portfolio company] work to do after deal sprints are done." In banking, he says you work more overall but there are pockets of fallow time. In private equity, it's relentless. 

Bankers work long hours during deal sprints, but the anonymous ex-banker says private equity professionals work even harder. Worse, their work is more demanding. "Different from banking, you need to put in some thought in what you are producing, and while this seems a strong positive at 11am fresh on a Tuesday, it is not at 2am on a Thursday night on the 3rd deal of the month that we all know is going to get killed," he says. 

Equally, while junior bankers complain bitterly of spending hours working on pointless pitches for deals that will clearly never come to fruition, the anonymous banker says this happens a lot in private equity too. - It's just that the pitches are for the internal investment committee. 

The private equity industry is awash with "fake work," he says. Partners who haven't closed deals in a while will often ask their teams to investigate CIMs (confidential information memorandums) proposing companies for the fund to invest in, even when it's immediately clear that the investments aren't viable. PE principals/VPs are too craven to push-back. 

"We start creating tons of ad-hoc analysis to see if we could actually do this (everyone knows we never will)," says the anonymous ex-banker. "After a week and 30 hours of work, the partner finally understands that we will never do this but tells us to put together a few “simple slides” about the opportunity to keep the group updated with what is coming to market." The entire process is a waste of time. 

The ex-banker also observes that work in private equity lacks intellectual rigour. Partners are again to blame. "There have been countless times when I have tweaked models in a way that is genuinely stupid so that we could hit the 18%+ IRR that our partner wanted. Imagine spending countless hours to create the most complex model to back-solve to the IRR that we want to show…."

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