Inside this year’s private-equity recruiting drama: how PE firms and headhunters are trying to enforce a new pact to delay a fierce battle for young talent

  • Sources told Business Insider that private-equity recruiting firm SG Partners broke an unwritten agreement between Wall Street headhunters and PE firms to delay the start of recruiting efforts until well into 2021.
  • The influential recruiting firm contacted candidates via email in both August and September, sources said, leading PE firms to intervene, warning the recruiting firm to back off.
  • PE headhunters are notorious for clambering to nab talent early on in their careers. In recent years, they have begun competing against each other to lock up young recruits earlier and earlier.
  • This year, recruiters have fears over the quality of IB analysts’ on-the-job training while working virtually, and can’t host in-person networking events and interviews — so they are pushing off the cycle into 2021.
  • So far the agreement between the headhunting firms has held, but continued actions by individual recruiters to contact candidates could further upend shifting timelines for the recruiting cycle, sources said. 
  • Visit Business Insider’s homepage for more stories.


It’s been in effect for just a few weeks, but the durability of an informal agreement between powerful private-equity firms and recruiters has already been put to the test.

A group of headhunters and their PE clients had backed off from reaching out to young investment bankers about private-equity associate jobs that start in 2022, Business Insider previously reported.

The move amounted to a ceasefire in an arms race for young talent that had been pushing the kickoff for recruiting earlier and earlier in recent years.

But according to four sources with knowledge of the situation, one recruiting firm, SG Partners, this year still started reach outs to investment banking analysts in their first few weeks on the job despite being a part of the informal agreement.  

Read more: Private equity is backing off from recruiting young investment bankers in the first few weeks on the job. Here’s what triggered the reversal.

The influential recruiting firm contacted candidates via email in both August and September, sources said. That prompted PE firms to intervene and tell SG Partners to back off. Sources who spoke to Business Insider requested to remain anonymous in order to preserve industry relationships. 

The move highlights the ultra-competitive nature of the battle for the best talent, and shows how the coronavirus pandemic has upended traditional hiring pipelines on Wall Street. 

SG Partners was created in 1991 and has resulted in 2,000 successful placements, according to its website. It has recruited on behalf of some of the biggest players in the industry including Blackstone, a person with knowledge of the firm’s work confirmed to Business Insider.

Sheri Gellman, the founder of SG Partners, did not respond to multiple requests for comment in time for publication. 

PE shops are still hiring out of investment banks for 2021 roles, interviewing candidates who have at least a year of experience under their belts, recruiters said.

While SG Partners’ actions did not immediately spark its competitors to abandon their agreement and kick-start the recruiting season, one source did indicate that this year’s agreement is only as strong as its members’ willingness to abide by it.

Too many unilateral actors disregarding it could force it to fall apart, triggering a possible return to the carnage of past PE recruiting cycles, the source added.

A delicate truce in the private-equity recruiting world 

News of SG Partners’ outreach to prospective candidates is said to have quickly spread across the Wall Street recruiting space.

“The information flows so quickly to everyone, and they can mobilize just as quickly,” a source said.

Read more: THE GATEKEEPERS: 12 headhunting firms to know if you want to land a hedge fund or private-equity job

HR personnel at several top-tier private-equity shops also learned about what Gellman’s firm was doing, according to several people with knowledge of the situation — and decided to crack down, chiding the firm for going against the broader industry pact.

Typically, rookie investment bankers are deluged with inquiries from private-equity recruiters at this point in the fall, often for jobs that won’t start until two years later. But, as Business Insider previously reported, with first-year investment bankers working remotely this autumn, recruiters are concerned that the quality of their training could be diminished. 

What’s more, in-person interviews and high-stakes networking events are also impossible this year, further incentivizing headhunters to wait it out until conditions improve in 2021.

For context, the private-equity recruiting scene is competitive, to say the least.

In recent years, headhunters that represent leading private-equity firms have moved up the start of the recruiting cycle as early as September, one-upping each other to nab the most attractive talent among first-year IB analysts. This year, the heads of top recruiting and PE firms coordinated with one another to jointly back off from the fight. 

See more: Private-equity firms are already interviewing 22-year-old bankers who will start in 2 years. Their earliest-ever hiring kickoff shows how crazy the battle for talent has gotten.

In August, Business Insider included SG Partners on a list of 12 leading agencies that recruit on behalf of Wall Street’s biggest names in the worlds of hedge funds and private equity.

Now, the headhunting firms are waiting to see if their agreement will subsist through 2021, or succumb to individual recruiters’ temptations to kick off the cycle prematurely. In spite of SG Partners’ outreach, so far the other firms have upheld their consensus, and the line is holding, sources said. 

Have any tips about hiring trends at financial services firms? Contact Reed Alexander via email at, encrypted messaging app Signal (561-247-5758), or direct message on Twitter @reedalexander. Contact Casey Sullivan via email at, encrypted messaging app Signal (646-376-6017), or direct message on Twitter, @caseyreports.

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