What to expect from the case study in a private credit interview
If you want to work in a private credit fund in London, you may have encountered Richard Hoar.
Hoar is a director at recruitment firm Goodman Masson, who specialises in private credit jobs. He cut his teeth recruiting for middle and back office jobs in the early 200s, but has “moved up the value chain.” So has the recruitment market, says Hoar.
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For all the bad press about redemptions from private credit funds and fraud-induced losses at the likes of Jefferies and Barclays, Hoar says private credit jobs retain their appeal. “It’s the buyside,” he explains. “You’re the principal, that’s more glamorous.”
While private equity funds provide capital that gives them a share in the equity of companies that are not publicly traded on exchanges, private credit funds make loans to companies that either can’t or don’t want to borrow in other ways. Private equity firms like to hire former M&A juniors; private credit firms like to hire former leveraged finance bankers.
Hoar says competition for places in private credit firms remains intense. “The funnel is sharp,” he says. Hundreds of people are filtered out after sending in CVs. 20-25 might get through to the first interview. 12 might get through to the second round interview. Six get through to the case study. Two get offers.
If you make it through to the case study, you are therefore doing well. Hoar says the case studies typically involve a presentation based around company accounts.
“You will have 3-4 hours to prepare the presentation and they will often put mistakes in there that you want you to spot,” he says. The emphasis is on identifying errors in covenants and documentation that might make the deal too friendly towards the borrower, plus reasons why the fund might make a loss. You’ll be asked to produce a memorandum on the deal and will be interrogated on this, says Hoar.
How can you prepare? Make sure you’re familiar with covenants and loan documentation. Make sure you can read a balance sheet.
Make sure, too, that you are used to presenting and to defending your case. “They want to se that you have attention to detail, can tell a story and can handle yourself under pressure,” says Hoar. “There will often be a good cop- bad cop approach to see if you can still handle yourself and come up with the right answers when you’re under pressure.”
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