Chicago Booth Review Podcast How to Get Into Private Equity
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Mar 11, 2026 Scott Meadow, a professor and private equity expert who advises on entrepreneurial finance and career pathways, shares practical guidance for breaking into PE. He outlines the main career routes, how PE values cash-generating businesses and picks sponsors, and what to look for in firms, portfolio companies, culture, and compensation.
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Private Equity Targets Predictable Cash Flow
- Private equity focuses on acquiring companies with predictable cash flow and improving returns by holding until roughly 2.5x return.
- Meadow illustrates with a $50M EBITDA business bought at 7x for $350M and sold later for ~$1B, creating sizable equity upside.
Join Portfolio Companies To Capture Equity Upside
- Work in mature, traditional industries to leverage sector expertise and gain equity upside at portfolio companies owned by PE firms.
- Meadow's PhD actuarial student could do the same job at a KKR-owned insurance company but with comparable salary plus equity upside.
Use Investment Banking As The Usual PE Pipeline
- If you lack direct PE experience, get investment banking training first, then jump to PE after 3–4 years.
- Top PE firms commonly recruit analysts from banks, rehire after MBA, so banking is the typical pipeline to PE roles.