Week in the Life of a Private Equity Associate: Stage 1 of a Deal
High Stakes, Heavy Workloads, and the Reality of Private Equity
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Feb 11, 2025
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Private equity (PE) is often seen as a dream job for finance professionals, but the reality of the day-to-day work can be quite different from the perception. A typical PE deal follows three key stages: evaluating a deal, due diligence, and closing the deal. Below, you will walk through a week in the life as a private equity associate during the first stage of a deal - when we are evaluating a potential investment opportunity.
9:30 a.m. You get into the office and start off with answering emails and catching up on economic and industry news.
10 a.m. A Confidential Information Memorandum (CIM) from Goldman Sachs comes across your desk, highlighting a consumer goods company selling luxury home products.
A Confidential Information Memorandum (CIM) is a document, typically 30-50 pages long, that serves as the company’s sales pitch. It typically includes an executive summary, market overview, financials, risks, and investment highlights. Information outlined in a CIM is often material non-public information (MNPI) and requires the receiving end to sign a non-disclosure agreement (NDA).
Along with the CIM, the Process Letter outlines that first-round bids are due in three weeks. To meet the deadline, an initial analysis must be presented to the Investment Committee (IC) next Monday.
12 a.m. Lunch is a quick salad from the nearby Sweetgreen with a few other finance bros as you try maintaining weight in your stationary lifestyles.
12:30 p.m. After lunch, to understand the industry landscape, you review a market study by BCG, providing data on market size, competition, trends, and key consumer demographics.
3 p.m. Review begins of the preliminary financial model sent by Goldman Sachs — which includes basic financials like historicals, projections, and detailed breakdowns of key line items.
4 p.m. Your Principal calls you into his office to discuss changes to an Investment Memo for a different potential deal you worked on last week.
6 p.m. Work on the preliminary financial model resumes, in which you start lightly plugging in numbers into a leveraged buyout (LBO) template and leave the bulk of the work for later in the week.
8 p.m. The day ends and you go back home.
Tuesday: Diving Deeper
9 a.m. Get back into the office, settle in and answer some emails. After that, you go back to reviewing the CIM and market study to dig deeper. You take detailed notes which will then be used to refine the financial model and investment memo.
11 a.m. You jump on call with a portfolio company's management team to receive updates on struggles and successes from the past quarter. They also update you on their strategic priorities for the upcoming months.
12 p.m. You jump on another call with your lawyers at Wachtell, Lipton, Rosen & Katz for a different deal that you are closing, discussing items like the purchase agreement, warranties, escrow terms, and more.
12:30 p.m. Another call with J.P. Morgan begins to discuss financing for the deal you are about to close.
1 p.m. Finally, you grab another quick lunch at Sweetgreen to eat at your desk. After which you continue working on inputting financials into the LBO model, taking into consideration the notes from earlier in the day to adjust key assumptions like entry and exit multiples, growth rates, and margins.
For this model, you build out two scenarios: one with the management case, which reflects the company's internal projections and tend to be a bit more optimistic, and a conservative case that accounts for other potential risks.
This work continues while you also answer emails and go into meetings with your other deal teams for other ongoing investments.
7 p.m. Since there is no immediate deadline, you wrap up your work and head home for the day.
Wednesday: Model Review & Insights
8:30 a.m. The day begins a bit earlier than normal to prepare for calls beginning at 9 a.m. that happen back-to-back with lawyers, bankers, and the audit team for another deal you are closing.
11:30 a.m. You grab an earlier lunch, eating a bit slower to recuperate from the back-to-back calls, while catching up on NBA news and checking your fantasy team.
12:30 p.m. Work on the LBO model resumes. You analyze trends and create sensitivity tables to evaluate return scenarios.
3 p.m. You complete the LBO model and send it over to your Principal, along with your thoughts and key findings. He replies with how he is busy and that you can expect comments later tonight. As a result, the next couple of hours are fairly relaxed and you just reply to some emails, check the news, and complete some administrative tasks.
6 p.m. With the rare luxury of a free evening, you wrap up early and head home.
Thursday: Drafting the Investment Memo
9 a.m. The day begins with reviewing the comments that your Principal gave you on the LBO model. He asks about your assumptions and corrects some mechanical errors in the model itself. The next few hours are spent on drafting a response and incorporating some changes to the model, which you then send back to your Principal for review.
11 a.m. You begin work on the investment memo. The memo must be as unbiased and factual as possible while being persuasive as to whether the deal is a go or no-go. This ends up taking you the rest of the day, along with a couple ad-hoc tasks and meetings.
Definition: The investment memo, at the initial stage of a deal, is a 1-2 page document that provides a high-level summary of the deal, company and industry overview, financials, risks, and preliminary return estimates.
7 p.m. You send over the memo to your Principal, ending your work for today.
Friday: Memo Finalization & IC Prep
9 a.m. Even though it is a lighter day, you get into the office fairly early to make changes to the investment memo so it can be sent back to your Principal for review.
11 a.m. After sending over the revised memo, your Principal calls you into his office to discuss some final changes and ask you clarifying questions regarding the transaction. After a few more changes, the memo is sent to your Partner.
3 p.m. The Partner responds back with a list of questions probing at the different assumptions in the model and parts of the investment memo. After a couple of hours of work, you send an email to your Partner with all the requested changes and answers to his questions.
6 p.m. Another response from your Partner comes in, this time with just a few smaller changes. You make the final changes and send the model and investment memo to the firm's Investment Committee (IC), who will then pressure test your thesis in the Monday morning meeting.
Definition: The Investment Committee (IC) is a group of senior investors at the firm who review and approve potential investments for a fund.
6:30 p.m. With no more work on your plate, you clock out for the weekend, heading off to dinner with friends to make the most of your Friday night.
Weekend: Work Doesn't Stop
Saturday. Although a lighter weekend, you get a call in the afternoon from your Partner with some additional questions. You spend an hour or so doing some research and answering his questions, but the rest of the day remains free.
Sunday. Another couple of hours are spent towards the end of the night to catch up on work from other deals and also review the investment memo before heading to IC tomorrow to ensure you are ready to answer any questions and provide clarifications.
Bottom Line
That wraps up a typical week for you as a private equity associate during Stage 1 of a deal. If this was helpful, stay tuned for an upcoming post covering Stage 2—the most intense part of the PE deal process.
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