Off-Cycle Private Equity Recruiting: How to Prepare for the Slow Grind to the Finish Line

While on-cycle PE recruiting keeps moving up, to the point where you must attend a “target” elementary school, middle school, and high school to be competitive, off-cycle private equity recruiting remains a viable option for everyone else.

Unfortunately, there’s a lot of confusion over what “off-cycle” means due to the changing start dates, the multiple recruiting cycles, and regional variations.

I will attempt to sort out the chaos here, but I’ll start with the basic definitions and explain who should care about this process:

Off-Cycle Private Equity Recruiting Defined

Off-Cycle Private Equity Recruiting Definition: In the off-cycle PE recruiting process, smaller firms (startup through middle market) hire candidates for immediate or near-term start dates via extended processes that require significant cultural fit, critical thinking, and presentation skills.

You can think of it like this:

• On-Cycle Recruiting: Fast processes for start dates far in the future.
• Off-Cycle Recruiting: Slow processes for very close start dates.

Off-cycle recruiting tends to require significantly more networking and outreach, but it’s also more accessible to candidates from different backgrounds.

For example, you don’t need to work at a bulge bracket or elite boutique bank to participate; you could work at a smaller bank, in management consulting, or another finance-related field (Big 4, corporate development, valuation, etc.).

Off-cycle recruiting is relevant to anyone who misses on-cycle recruiting, chooses to skip it, or recruits outside the U.S., as most PE recruiting in other countries is off-cycle.

It’s also relevant if you’re interested in smaller firms with better work/life balance; lower-middle-market (LMM) and middle-market (MM) PE firms are more likely to use it than upper-middle-market (UMM) firms and mega-funds (MFs).

If you use your first year in investment banking to gain solid deal experience, your odds of winning a PE offer will improve if you use off-cycle recruiting; if you sit around and do nothing, your odds will fall.

There is confusion over what “off-cycle” means because some people use it to refer to the actual off-cycle process run by smaller firms AND the “later cycle” processes run by large PE firms.

For example, if a PE mega-fund starts recruiting in June 20X4, it might run additional processes in September 20X4, December 20X4, or January 20X5 if it can’t hire enough candidates via the first process in June.

I do not consider this off-cycle recruiting in the same way because the processes are faster, and you’re still interviewing for jobs that start over a year into the future.

That said, we will address some of these cases in this article due to the usage of the term “off-cycle.”

Off-Cycle Private Equity Recruiting, Part 1: Who Should Care?

Off-cycle recruiting is prevalent in almost all regions outside the U.S.:

• Europe and the U.K. (see: London private equity recruiting).
• Asia-Pacific (Hong Kong, Singapore, China, India, Australia, etc.).
• Canada.
• Emerging Markets (Latin American countries such as Mexico and Brazil, the Middle East, Africa, etc.).

On-cycle recruiting is mostly relevant if you’re in the U.S. working in investment banking at a large firm and want to move to a large PE firm; off-cycle is more important in all other cases.

So, if you’re a career changer, you’re at a smaller bank, you’re already an IB Associate and want to exit, or you did not win an on-cycle offer, off-cycle recruiting is critical.

A few factors explain why PE firms use off-cycle recruiting to hire candidates:

1. Timing / Preparation – Many smaller firms do not want to compete for IB Analysts in the mad on-cycle rush each year. They would rather wait for candidates to gain real deal experience, evaluate them over a longer period, and pick the ones that best fit their firm.
2. Competition – Smaller firms know they will not attract the most hardcore Analysts at the biggest firms, so they wait until these candidates have accepted offers and then focus on everyone else.
3. Inability to Find Candidates or Cancelled / Reneged Offers – This one applies more to the UMM and MF PE firms that do “later cycle recruiting,” but as the start dates have moved up, many firms have trouble hiring enough qualified candidates in the initial rounds.

Also, some people renege on their offers when they realize they hate IB/PE, want more work/life balance, or change their career plans, which creates the need for more hiring.

Off-Cycle Private Equity Recruiting, Part 2: The Basic Process and Timing

“Later cycle” recruiting still involves headhunters contacting bankers to set up initial meetings and firms conducting interviews and modeling tests in a short time frame.

The process might take longer than the first on-cycle round, but it’s still fast (i.e., days or maybe 1 – 2 weeks, but not months).

In real off-cycle recruiting conducted by smaller PE firms, you can expect the following:

• The “experience” sweet spot is usually about 1 year on the job and up to 18 months in some regions. You need enough time to gain solid deal experience but not so much that you get pigeonholed into banking (i.e., you should ideally make the move before being promoted to Associate).
• Headhunters may be involved, but you can also bypass them by networking via your bank’s alumni and referrals from friends at other firms.
• Initial interviews are usually done remotely and consist of the standard behavioral/cultural fit questions and maybe a simple technical assessment, such as a paper LBO model or a 60-minute LBO modeling test.
• The next round(s) is/are more like an IB Superday, where you go to the firm’s office and meet Associates, Senior Associates, VPs, Principals, and eventually MDs/Partners and answer a mix of fit, technical, and deal questions. This process can drag on over weeks or months because they might call you in for multiple visits.
• The final round usually consists of a private equity case study presentation based on a CIM, a company they assign, or a company of your own choosing. This round is more about your critical thinking and presentation skills and less about raw technical abilities.

Some candidates are eliminated in the first few rounds, but the case study tends to “separate the wheat from the chaff.”

Many people can download and complete LBO models without much thought, but it’s much harder to research your assumptions, back them up with data, and then justify your thinking on the spot when presenting to 5 – 10 senior professionals.

The timing is difficult to predict, but the median process length is probably 1 – 2 months since some firms finish in a few weeks and others take 3 – 4 months.

If your process drags on for 6+ months, you are probably not getting an offer, so it’s best to switch your focus to other firms.

Off-Cycle Private Equity Recruiting, Part 3: Finding Firms and Networking

So, if you have some solid deal/client experience, good technical skills, and want to participate in the off-cycle process, how do you get started?

Networking with private equity professionals can be difficult because they tend to be busier and less receptive than bankers, so the “informational interview” route might not work well.

It’s probably the most viable at newer funds that have just raised capital, aren’t yet busy with deals or portfolio companies, and need to hire an Analyst or Associate.

My recommendations are as follows:

• Focus on “alumni” from your banking group and get as many referrals as possible from them. These can be for specific people at other PE firms, recruiters, or both.
• Also, contact friends/acquaintances at other banks and ask about referrals to headhunters and PE professionals.
• Search for new PE funds that are launching and existing firms that are expanding by setting up Google Alerts for the relevant keywords on sites like Axios Pro Rata, Fortune Term Sheet, eFinanicalCareers, etc.
• Set up alerts for senior-level hires at PE firms because these often indicate the intent to expand or raise a new fund, which means more hiring.

You could look up small and mid-sized PE firms in your area and get started with cold calls, emails, and LinkedIn outreach, but this is not the most efficient strategy.

Focus on firms that have just raised a new fund or announced an expansion and ones where you already have a connection.

Off-Cycle Private Equity Recruiting, Part 4: Resumes, Interviews, and Case Studies

We already have separate articles on private equity resumes, private equity interviews, and private equity case studies, so I’ll refer you to those rather than repeat everything here.

I would summarize the key off-cycle recruiting differences as follows:

• Resumes: You should probably insert a few items that make you appear to be a “human” rather than a “deal/prestige” machine. Since cultural fit is critical at these smaller firms, you don’t want to devote 100% of your resume to your deals and technical experience.
• Interviews: All the standard technical questions about accounting, valuation, and LBO modeling could come up, but behavioral and “culture” questions are especially important because firms and teams are smaller. You need to connect based on non-work topics to perform well.
• Portfolio Companies: You need to know the firm’s companies, deals, and strategies very well. You should arguably spend most of your time preparing for these points because they’re one of the few ways to differentiate yourself.
• Technical Preparation: Sure, practice LBO modeling and case studies, but skip advanced-level models and focus on 60 and 90-minute models that are “cash flow only” or that use simplified financial statements. You want models that can be easily adapted to the open-ended, take-home case studies you will get in the final rounds.
• Deals: Because of the timing of off-cycle recruiting, interviewers will have higher expectations for your deal experience. You should be prepared to discuss 2 – 3 deals in detail, including the motivations of each side, the financial stats and valuation multiples, and your view of each one as an investor.

Off-Cycle Private Equity Recruiting, Part 5: What If You Don’t Get an Offer?

As stated above, the timeline here varies, ranging from days to weeks or months.

The biggest issue is that many of these smaller firms are understaffed and don’t have the resources to recruit, close deals, and manage portfolio companies simultaneously, which slows down response times and interviews.

All you can do is keep following up aggressively and maintain your dialogue with other firms to create competitive tension and get responses more quickly.

If you win an offer, you’ll either start immediately or within the next 3 – 4 months, depending on the firm and region.

If you do not win an offer because the firm explicitly rejected you or because they “ghosted” you, your next steps depend on a few factors:

• How close are you to an Associate promotion?
• Are you in the U.S., Europe, or another region?
• How many other firms are you speaking with, and can you reasonably get interviews within the next ~6 months?
• Why did you not receive an offer (e.g., weak technical skills, not enough firm research, unknown bank, poor deal experience, low grades, etc.)?
• How eager are you to leave banking? Could you survive another year or two, or do you need an immediate exit?

In general, it’s more plausible to fix your problems and try recruiting again if you’re in London or another part of Europe because the recruiting time frames are less strict.

If you’re in the U.S., and you’re up for an Associate promotion soon with no other interviews in sight, it is probably better to target other exit opportunities, such as corporate development or venture capital – if your main goal is to exit banking.

On the other hand, if you think you can improve your profile in a short time frame (before you get promoted), you could make another run at off-cycle recruiting.

A top MBA program is usually not a great idea because your chances of getting into PE post-MBA without doing PE pre-MBA are low.

Even if you want to move to a bigger/better bank, it’s a bit silly to do an MBA if you’re already in the industry; just network and go through referrals to interview at larger firms.

An MBA makes more sense if you’re making a big career change and need the degree to get into IB before considering PE roles.

Final Thoughts on Off-Cycle PE Recruiting

While the on-cycle process gets all the hype and attention, far more people get into private equity via the off-cycle process – especially if you consider the global numbers rather than just the U.S.

Therefore, this process is more important on an industry-wide basis.

In my view, the off-cycle process is more challenging because it’s not just “test prep.”

In other words, you can’t win offers just by working at a top bank and practicing LBO modeling tests repeatedly over a few days.

You need to understand your deals, industry drivers, and how to pitch buyout candidates to succeed.

It’s more like learning a foreign language than preparing for a standardized test, especially considering the live discussions after your case presentation.

On the other hand, you also have a lot more time to prepare, so if you’re more of a “slow burner learner,” you might find the process easier.

If you do, that’s great news because you can skip the on-cycle process and not even worry about attending a target elementary school, middle school, or high school.