What is Bain & Co's Private Equity Group? (2022)

What is Bain & Co's Private Equity Group? (1)
Emma Rovit, ex-Bain Consultant, ex-Instacart
Published: January 23, 2020

One of Bain's biggest differentiators in the management consulting industry is their Private Equity Group, or PEG, as it's referred to within the firm.

Bain's Private Equity Practice is much larger than either McKinsey's or BCG's, both in terms of the size of the team (over 1,000 people) and the number of deals they're involved in. As they report, "Bain has advised on half of all buyout transactions worldwide valued at more than $500 million in the past decade."

You may be wondering exactly why this expertise matters or how it could impact your decision to work at Bain. Or maybe you're thinking, "what would a private equity case look like?" Don't worry, we'll cover all this and more below.

What is Bain & Co's Private Equity Group? (2)

In this post, we'll cover the following:

  1. Private equity (PE) overview
  2. Private equity case work
  3. Bain's private equity group (PEG)
  4. Bain's history in private equity
  5. Career opportunities in Bain's PEG

Let's get started!

Private equity (PE) overview

If you have a good understanding of what's meant by private equity, skip to the next section. For everyone else, let's dive in.

Private equity (PE) is an umbrella term used to describe funds (comprised of pooled investor money) that invest in or directly buy companies that are either already outside of public markets or with the aim of taking them private (e.g. they will no longer be listed on the public market they used to trade on, like NASDAQ, etc.).

How do PE firms make money? They essentially flip businesses, much like someone could flip houses. PE firms use large amounts of leverage (lots of debt) to buy a company, then use their industry or operational expertise to fix their purchase up - improve efficiency, expand to new markets, etc. Their goal is to sell the business in just a few years - to a different PE fund, a corporate buyer, or the public markets (IPO) - for a large return.

(Video) The 2022 Global Private Equity Report: Market Overview

So where would a management consulting firm come in to this equation? Let's take a look.

Private equity case work

Bain's Private Equity practice can support Private Equity clients throughout the lifecycle of their investments. Clients might engage Bain when they are looking to:

  • Dig into the due diligence around a potential investment
  • Build a model to estimate the value of a deal
  • Develop tactical initiatives to improve the profitability of a company already in their portfolio

Example private equity case

Let's go through a hypothetical due diligence example, since this is the most unique work for the PEG group (optimizing a portfolio company is similar to just optimizing a typical client company).

Let's say there's a PE Firm called Rocket Capital that typically buys small restaurant chains, launches them in new markets, then sells them to more established businesses.

The majority of their investments are fast casual or casual chains that are regional players. The firm has recently been seeing huge growth in the frozen yogurt market and are interested in buying a small chain that's become the market leader in the midwest – Green Mango.

However, Rocket Capital doesn't have as much knowledge of this space, and wants to move quickly as they think other firms may be eyeing Green Mango as well. In this situation, they might bring a Bain team on for a couple weeks to support due diligence activities. This could include broad market research (customer and expert interviews, surveys, third party reports) to estimate potential growth of the frozen yogurt industry over the next 10 years.

In addition, Bain might look at the competitive landscape and what Green Mango's advantages or differentiating factors are. Finally, Bain could provide insight into areas of opportunity for Green Mango if the deal went through, including identifying geographies that are attractive for expansion, operational improvements (e.g. changing suppliers or renegotiating contracts), or potential exit options.

Bain's private equity group (PEG)

It's important to call out some of the major implications of working in PEG and being involved in this type of work.

In terms of lifestyle, PEG cases feel more like short sprints of work: 2 or 3 week cases with clear deliverables and tight timelines. This means consultants often have very intense weeks followed by a couple days off between deals.

Second, PE clients tend to be very demanding. Part of this is due to the people PE attracts (ambitious, direct, logical), and part is due to the high-stakes nature of these deals: firms are considering investing millions or even billions, so the pressure they feel can often spill into PEG due diligence teams.

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On a positive note, the short timelines mean there's opportunity for consultants to go through numerous deal cycles - which can mean accelerated learning and great industry experience. Also, PEG teams rarely travel, as they aren't working out of a client's site and can do much of their work from the office. This can be a huge plus for those that want to stay local.

In terms of staffing, the private equity practice is a bit different than a standard case. Consultants are staffed to PEG for 6 months at a time, so it's almost treated like a rotation within the firm. PEG includes consultants at all tenures; ACs and Consultants will typically share their interest in being staffed to the group when they meet with the staffing manager.

As someone applying to Bain, you wouldn't apply directly to PEG, but it is useful to note that some Bain offices have bigger practices than others. For example, Boston, London, and Chicago have some of the largest private equity groups, so if PEG is on your radar, applying for an office with a bigger private equity presence definitely makes sense.

What is Bain & Co's Private Equity Group? (3)

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(Video) The Current State of Private Equity

Bain's history in private equity

Nearly one quarter of Bain's global business is now private equity work, but this wasn't always the case. In fact, the history of private equity at Bain goes back to the early years of the firm when Bain Capital was started.

It's impossible to talk about Bain's Private Equity Practice without briefly touching on Bain Capital. Although there is often confusion between the two firms, they have always been separate entities: Bain & Co. is a management consultancy, whereas Bain Capital is a private equity firm.

Mitt Romney, a former Bainee, started Bain Capital in 1984 (full list of famous ex-Bain employees here). The idea was to apply the same principles Bain used with their clients to businesses they invested in. Although the two businesses are independent, they have always and continue to work together. For example, Bain Capital supplies Bain with a steady stream of PE work, and Bain partners are eligible to invest in Bain Capital funds (which is a big selling point).

Ultimately, Bain's work for Bain Capital gave them a beachhead to build up a private equity practice - it was the springboard that launched the practice. While they continue to work with Bain Capital, the Bain PEG does work for hundreds of different private equity firms across the globe as well.

Career opportunities in Bain's PEG

What would the benefits be of working in PEG longer term?

Working in Bain's Private Equity Practice can be a great opportunity to learn more about the private equity industry. A rotation in PEG will also provide really solid hands-on experience and exposure to the deal flow. This would be hugely beneficial for someone looking to work at a private equity firm after consulting. Aside from going into investment banking, doing a PEG rotation is one of the best ways to get your foot in the door of the PE industry. Given the close relationship, Bain Capital is a popular firm for Bainees looking to make the transition to PE.

Overall, Bain is a great place to work for those interested in private equity or looking to keep their options open after consulting. Bain's experience in the industry and constant deal flow makes the practice one of the biggest strengths of the firm.

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FAQs

Is Bain private equity? ›

Bain Capital Private Equity By the Numbers

Bain Capital, LP is one of the world's leading private investment firms with approximately $160 billion of assets under management that creates lasting impact for our investors, teams, businesses, and the communities in which we live.

What makes Bain & Co unique? ›

Bain Emphasizes Delivering Results to Clients

Bain was founded on the principle 'Results, not reports,' and they invest in their clients' success through tied economics in their fee structure. This allows Bain to better align their financial incentives with client outcomes – they put their money where their mouth is.

Which consulting firm is best for private equity? ›

Top Private Equity consulting firms in the world
  • BearingPoint is an independent management and technology consultancy with European roots and a global reach. ...
  • Capco. ...
  • CIL Management Consultants. ...
  • dss+ ...
  • Point B. ...
  • Sia Partners. ...
  • Genioo.

Is Bain a capital PE? ›

Our Businesses

Private Equity From Bain Capital Private Equity's founding in 1984, our private equity team has partnered closely with management teams to provide the strategic resources that build great companies that can grow and help them thrive.

What do you know about Bain? ›

Strong Private Equity Practice

Bain is the leading consulting partner to the private equity industry. It has a global practice in this area over 3x larger than any other consulting firm.

What is the number 1 consulting firm? ›

McKinsey is known as the “gold standard” in management consulting and is the most recognized management consulting firm in the world. McKinsey hires the smartest and most talented people and has generated the greatest number of Fortune 500 CEOs.

What does a private equity consultant do? ›

For example, a private equity consultant may be hired by a PE firm to help them create value for their portfolio companies. One way they might do that is by reviewing and recommending changes to the portfolio companies' pricing strategy based on market research, the companies' positioning, and growth trends.

How much do private equity consultants make? ›

How much does a Private Equity Consultant make? As of Sep 23, 2022, the average annual pay for a Private Equity Consultant in the United States is $92,280 a year. Just in case you need a simple salary calculator, that works out to be approximately $44.37 an hour. This is the equivalent of $1,774/week or $7,690/month.

Does Bain and company pay well? ›

Bain consultant salary prospects are especially strong for incoming MBA hires who earn base salaries of $175,000. Master's-level graduates get offered around $100,000 in base salary at Bain. MBA hires at Bain receive performance bonuses of $41,250 and a signing bonus of $30,000.

How hard is it to get into Bain Capital? ›

Probably the toughest part of the application process is passing the initial screening process. As an example, a large Bain office would receive around 3000 applications and narrow it down to about 100 for the first interview. So you would have to be at the top 3% to even get the interview.

Who is Bain Capital owned by? ›

Since our founding, Bain Capital has remained highly aligned to our limited partners and grown to become one of the world's largest private, multi-asset investing firms. Bain Capital is a private, employee-owned company.

How do you answer the question why Bain? ›

The most important thing is to show interviewers you're structured and MECE. If a Bain interviewer were to ask me a question along the lines of “Why do you want to join us?”, I would answer them in the order of two parts – (1)”Why Consulting” and (2)“Why Bain”.

Why is Bain the best company to work for? ›

In their reviews on Glassdoor, employees praised Bain & Company's commitment to fostering an inclusive, supportive culture, camaraderie among teams, intellectually challenging and rewarding work, and flexible career paths.

Why do you want to work at Bain Capital? ›

Bain Capital is a wonderful company to grow with. The culture feels a lot like family. You are consistently challenged but very motivated to succeed because you are rewarded for it. It is a company with extremely bright employees that inspires you to rise and give your best.

How do private equity firms make money? ›

Private equity firms buy companies and overhaul them to earn a profit when the business is sold again. Capital for the acquisitions comes from outside investors in the private equity funds the firms establish and manage, usually supplemented by debt.

What is an example of a private equity firm? ›

Some examples of private equity firms include Blackstone, Kohlberg Kravis Roberts & Co. (KKR), and The Carlyle Group. In addition to funding, the relationship between a private equity firm and the companies it invests in can include mentorship and industry expertise.

How many private equity groups are there? ›

Private equity funds invest across a range of industries such as energy, healthcare, manufacturing, retail, and technology. In 2020, the US private equity sector included approximately 4,500 private equity firms and 16,000 PE-backed companies.

What kind of company is Bain? ›

Global leaders come to us to solve industry-defining challenges in: strategy, marketing, organization, operations, information technology, digital transformation and strategy, advanced analytics, transformations, sustainability, corporate finance and mergers and acquisitions, across all industries and geographies.

How many rounds of interviews does Bain have? ›

Typically, Bain's interview process consists of 2 – 3 rounds of interviews: First round: 2 back-to-back interviews with consultants. Second round: 2-3 back-to-back case interviews with partners.

What is working at Bain like? ›

Great culture, amazing learning opportunities

There's always a way to feel challenged, to learn something new. The teams are full of amazing, humble, and really talented people. Intellectually, one of the best options to go for. Work life balance (as is often the case in Consulting) can be challenging.

How prestigious is Bain? ›

In other words, the majority of people in consulting fields agree that MBB are the best firms when it comes to prestige.
...
1.1. MBB Firms Have Much Higher Prestige Score (Vault 2020)
RankScoreName
18.984McKinsey & Company
28.738Boston Consulting Group
38.600Bain & Company
47.121Deloitte Consulting LLP
6 more rows

Who are the big 4 in consulting? ›

They are Deloitte, Ernst & Young (EY), PricewaterhouseCoopers (PwC), and Klynveld Peat Marwick Goerdeler (KPMG). Aside from auditing services, the Big Four offer tax, strategy and management consulting, valuation, market research, assurance, and legal advisory services.

Is BCG better than Bain? ›

In head to head recruiting, Bain often beats out BCG because of culture but loses to McKinsey based on prestige or brand-name. In terms of staffing, you'll find that Bain is more analyst heavy than both McKinsey and BCG. On a standard McKinsey or BCG team, there may be only 1 analyst.

What is the difference between private equity and consulting? ›

Consultants work on one project at any given point in time, whereas private equity professionals frequently cover 2 or 3 portfolio companies – sometimes even more. In the latter case, you can pick your battles and produce the effort where the reward exceeds your cost (i.e. your salary).

Is private equity a good career? ›

A career in private equity can be highly rewarding, both financially and personally. Private equity managers often take a great deal of satisfaction from successfully guiding their portfolio companies to new high levels of profitability.

Why do private equity firms hire consultants? ›

Those consulting candidates have more work experience, a track record of performance at their current firm, and tend to perform better in interviews. This makes it easier to avoid hiring mistakes based purely on potential rather than performance plus potential.

How many hours does private equity work weekly? ›

Private Equity Associate Lifestyle and Hours

At many smaller funds and middle-market funds, you can expect to work 60-70 hours per week, mostly on weekdays, with occasional weekend work when deals heat up.

How many hours a week do people in private equity work? ›

People in private equity are older, more professional and tend to have young families, so most people care about having good weekends. When you're in the heat of a live deal, you'll most likely be working 80+ hours per week.

How hard is it to get a job in private equity? ›

Landing a career in private equity is very difficult because there are few jobs on the market in this profession and so it can be very competitive. Coming into private equity with no experience is impossible, so finding an internship or having previous experience in a related field is highly recommended.

What is the starting salary at Bain? ›

At Bain & Company, entry-level consultants may earn up to $120,000 per year, while senior ones have salaries up to $230,000 (bonuses and profit sharing included). The salary of managers (Project Leaders) can hit $240,000, while Principals and Partners can make up to $1,000,000.

How much does Bain and Company pay to freshers? ›

Average Bain & Company Junior Consultant salary in India is ₹ 30.2 Lakhs for 2 to 3 years of experience. Junior Consultant salary at Bain & Company ranges between ₹ 23.7 Lakhs to ₹ 35 Lakhs. According to our estimates it is 236% more than the average Junior Consultant Salary in Management Consulting Companies.

How much does a manager at Bain earn? ›

Average Bain & Company Manager salary in India is ₹ 40.1 Lakhs per year for employees with experience between 6 years to 14 years. Manager salary at Bain & Company ranges between ₹ 28 Lakhs to ₹ 65 Lakhs per year. Salary estimates are based on 54 salaries received from various employees of Bain & Company.

Is it hard to get an interview at Bain? ›

Your resume, with a cover letter, is the first step to a very lucrative job at Bain & Company. Yet, less than 15% of applicants receive a call for an interview.

Is it hard to get an internship at Bain? ›

Candidates with business school exposure are preferred, especially those who come from top internationally ranked business schools. Fluency in English is also preferred. It is important to point out that only 1% of applicants actually land an internship at Bain, making this is a highly competitive application process.

Why is Bain not McKinsey? ›

Bain has the deepest network with PE and hedge funds, while McKinsey has broader connections with most traditional industries and public sector organizations. It's wise to do a quick LinkedIn check for alumni of each firm in industries you're interested in, based in the city you aim to work in.

How many funds does Bain Capital have? ›

We have more than 900 Private Equity LPs, with the majority having invested with us for over a decade.

What is the difference between Bain Capital and Bain & company? ›

Although there is often confusion between the two firms, they have always been separate entities: Bain & Co. is a management consultancy, whereas Bain Capital is a private equity firm.

How big is Bain and company? ›

Bain & Company
TypeIncorporated partnership
Number of locations58
Key peopleManny Maceda (Worldwide Managing Partner) Orit Gadiesh (Chairman)
Revenue$5.8 billion (2021)
Number of employees13,000 (2020)
6 more rows

Does Mckinsey have private equity? ›

We help private equity firms make better investment decisions at every stage of the deal life cycle and build greater returns through active management of portfolio companies.

What kind of company is Bain Capital? ›

BAIN CAPITAL FOUNDED

From our founding as a private equity firm, we've extended our approach across asset classes to include public equity, credit, venture capital and real estate. And, we leverage our shared platform to capture cross-asset class opportunities in strategic areas of focus.

Is Bain a public company? ›

Bain & Company is an American management consulting company headquartered in Boston, Massachusetts. The firm provides advice to public, private, and non-profit organizations.
...
Bain & Company.
TypeIncorporated partnership
Revenue$5.8 billion (2021)
Number of employees13,000 (2020)
Websitewww.bain.com
7 more rows

Is Bain Capital owned by Bain? ›

As a separate company, Bain Capital shares no management or information with Bain & Company.

How much do private equity consultants make? ›

How much does a Private Equity Consultant make? As of Sep 23, 2022, the average annual pay for a Private Equity Consultant in the United States is $92,280 a year. Just in case you need a simple salary calculator, that works out to be approximately $44.37 an hour. This is the equivalent of $1,774/week or $7,690/month.

What is the future of private equity? ›

The private markets are expected to grow to about $12.5 trillion in 2025 from $7.2 trillion in 2020, according to Morgan Stanley. Buyouts, growth equity and venture capital account for about 69% of the industry, the investment bank said.

What do you mean by private equity? ›

What Is Private Equity? Private equity describes investment partnerships that buy and manage companies before selling them. Private equity firms operate these investment funds on behalf of institutional and accredited investors.

What do private equity firms do? ›

Private equity firms invest the money they collect on behalf of the fund's investors, usually by taking controlling stakes in companies. The private equity firm then works with company executives to make the businesses — called portfolio companies — more valuable so they can sell them later at a profit.

Does Bain and company pay well? ›

Bain consultant salary prospects are especially strong for incoming MBA hires who earn base salaries of $175,000. Master's-level graduates get offered around $100,000 in base salary at Bain. MBA hires at Bain receive performance bonuses of $41,250 and a signing bonus of $30,000.

Is Bain Capital a good company? ›

Bain Capital has an overall rating of 4.3 out of 5, based on over 210 reviews left anonymously by employees. 93% of employees would recommend working at Bain Capital to a friend and 86% have a positive outlook for the business. This rating has improved by 3% over the last 12 months.

How do you answer the question why Bain? ›

The most important thing is to show interviewers you're structured and MECE. If a Bain interviewer were to ask me a question along the lines of “Why do you want to join us?”, I would answer them in the order of two parts – (1)”Why Consulting” and (2)“Why Bain”.

What are the Big 3 consulting firms? ›

In management consulting, MBB stands for McKinsey & Company, Boston Consulting Group, and Bain & Company, the three most prestigious firms in the industry (also known as the “Big Three”).

How hard is it to get into Bain? ›

Bain's recruitment process is one of the most selective as well: it is common for only 1% of consulting applicants to receive offers.

How many funds does Bain Capital have? ›

We have more than 900 Private Equity LPs, with the majority having invested with us for over a decade.

What is the difference between Bain Capital and Bain & company? ›

Although there is often confusion between the two firms, they have always been separate entities: Bain & Co. is a management consultancy, whereas Bain Capital is a private equity firm.

Who runs Bain Capital? ›

John Connaughton is the Global Head of Bain Capital Private Equity and Co-Managing Partner of Bain Capital, a leading private investment firm with offices on four continents and approximately $160 billion in assets under management. Since joining the firm in 1989, Mr.

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