Dealbreaker recently highlighted what a little extra guts can do for your private equity job search. It seems last Fall an ambitious job-seeker named Jeffrey Chiang went too far. More recently, another decided to take a page from personal ads and the acting world to give his resume that added kick – and it worked.

The successful candidate included a few “action” shots along with a close-up photo (known in acting circles as a head shot) along with his cover letter and CV. One of the photos showed him scaling the Himalayas; the other sailing a boat.

source: Dealbreaker

It may sound contrived but it caught the attention of the firm he was targeting, says Dealbreaker. That, plus the fact that he graduated from college at age 20, interned at Merrill Lynch and is currently studying for his Level 1 CFA all resulted in an interview.

Dealbreaker posted his cover letter online in case you’re looking for ideas. It begins: ” My character can be summed up by a personal adage: “The only limitations are rules of science. All others we put on ourselves.” I am willing and eager to do whatever it takes to work at [name of PE firm omitted] so that I may gain the experience I desire. I graduated with a B.S. in Finance from San Diego State at twenty whilst simultaneously doing an internship at Merrill Lynch. I am currently finishing my Master of Finance with courses from Harvard as well as studying for my level 1 CFA.”

His approach may make some people cringe. But it definitely shows confidence and attitude. What’s your take? What’s the gutsiest or most unusual ploy you’ve ever heard about for getting a foot in the door (for an interview) at a private equity firm? Add your comments below.

Venture capitalists today, more than ever, need to be talent scouts, says Saad Khan, in a guest article for Forbes. Khan is a partner at the venture capital firm of CMEA Capital where he leads CMEA’s Web, digital media, and twinkle-stage investments in Pixazza, Blekko and Jobvite.

As incubators for embryonic companies, venture capitalists have to think in terms of the people they are investing in. Especially since many start-ups, particularly in technology, “pivot” a few times from their original idea. Many times the idea you invest in is not what the company ultimately ends up doing, he says.

For example, Rich Skrenta, a hacker of some renown and serial entrepreneur, is the type of entrepreneur Khan says is working banking on. Skrenta’s early successes included being a high-tech prodigy by ninth grade and later launching start-ups such as NewHoo (subsequently the Netscape Open Directory) and Topix.

Khan’s point: “I want to invest in the innate drive, talent and potential of a person. I want to invest in what they’re working on now, what they’re thinking about next, and whatever they dream up in the future. When it comes to exceptional talent, I’ve stopped worrying about technology, market sizes, product-market fit, etc.”

Khan likens his style of venture capital investing to the MacArthur “Genius Awards,” the $500,000 grant given by the MacArthur Foundation to exceptional people to work on projects of their choosing.

What’s your philosophy? Can venture capital investing really be more like an equity investment in a person’s intellectual future? Can one ignore the business plan and financial models and simply give brilliant people the opportunity to succeed? Add your comments below.

Private Equity tycoon David Bonderman went to Harvard. So did Apollo Management’s Leon Black and Hamilton James of Blackstone. It turns out that the ranks of Harvard alumni who are billionaires jumped to 62 this year, up from 54. More than any other American university, reports Forbes.

One billionaire alum, speaking anonymously, claims the school’s system of dividing each year’s classmates into smaller groups of roughly 120 students makes networking easier and leads to closer, more lasting, and therefore more profitable life-long business relationships.

Rounding out the top 10 schools for billionaire graduates were: 2) Stanford, with 28, including Yahoo cofounder Jerry Yang and Google founders Sergey Brin and Larry Page; 3) Columbia University, with 20 billionaire grads, including private equity pioneer Henry Kravis. The University of Chicago has 13 billionaire grads, along with 85 Nobel Prize winners. It placed sixth on the list. Other notables include New York University, tied for 8th place with 10 billionaires and Princeton University, tied for 10th place with 9 billionaires.

Schools with the most billionaires get the biggest gifts, naturally. For example, Home Depot cofounder Kenneth Langone earned an M.B.A. in a part-time program from NYU. He is a major donor to the school and has a medical center named after him.

The Forbes article does point out that having an Ivy League degree isn’t absolutely necessary for a billion-dollar private equity career.  As a matter of fact, out of the Forbes 400 list of wealthiest people, 41 don’t even have a college degree.

Has an Ivy League degree opened doors for your private equity career? We’d like to hear. Add your comments below.

Venture capital website Xconomy recently interviewed Kate Mitchell and Rory O’Driscoll, both general partners at Scale Venture Partners, a Foster City, CA-based firm that focuses on helping startups through the middle stage of their growth, for their take on the wild swings in the venture capital industry.

Mitchell is also the incoming chairperson for the National Venture Capital Association, the main trade association representing the venture industry in Washington, D.C.

They both confirmed that the industry will struggle through a rough patch in the next 2-3 years as limited partners react to subpar investment returns by pulling money out of venture capital. It’s a painful and necessary shakeout for the industry, says Mitchell. There were too many venture capital firms chasing too few investors, and too many entrepreneurs competing in the same space.

The pull-back will be more noticeable outside of Silicon Valley and Boston, where the venture capital community is bigger and better able to withstand the shakeout. Other regions will find fundraising to be particularly challenging.

However, balancing this trend is the fact that many entrepreneurs are now more efficient in the way they use capital. They’re reserving more capital for later stages of actually scaling up their business.

The venture capital industry may have overshot the amount of investment the industry could reasonably absorb by a factor of ten, and is now swinging back drastically in the opposite direction. But this does not mean that the venture capital model is “broken” says O’Driscoll.

There’s still no hard evidence that any other form of capital allocation works as well to fund business innovation. Europe has a highly state-sponsored venture capital system, and entrepreneurship is even more challenging there, he says. Plus there are signs that China has lowered its capital gains tax rate to 10 percent and may lower it further, in an effort to essentially copy the proven U.S. venture capital model.

What are your thoughts? What could invigorate the struggling venture capital investment outside of major centers such as Silicon Valley and Boston? Add your comments below.

Entrepreneurs typically look down their noses at MBA grads, believing great business leaders are born and not made. Or at least forged in the crucible of actually starting a company.

But today’s MBA programs are adapting and offering training that is much more suited to those who wish to build and grow businesses, including those looking for a career in private equity.

So says Chad Troutwine in a guest article for the Wall Street Journal online. Full disclosure, however: Troutwine is founder and CEO of Veritas Prep, a GMAT prep and MBA admissions consulting firm.

Nevertheless, Troutwine says an MBA is a gamble worth taking. Graduate business school curricula have evolved. Many of the top-ranked schools now offer multiple classes geared for budding entrepreneurs.

At the Yale School of Management, for example, David Cromwell, the former CEO of JPMorgan’s private-equity investment group, teaches a year-long course on writing successful business plans and launching sustainable ventures. Other schools boast well-funded entrepreneurial programs such as the Price Center for Entrepreneurial Studies at UCLA’s Anderson School of Management and the Johnson Center for Entrepreneurship & Innovation at Indiana University’s Kelley School of Business.

Graduating from a business school can give you a leg up on networking for life, as well. Top MBA programs admit hundreds of students each year. Members of each cohort develop strong bonds that can last an entire career. And since MBA grads will typically disperse into different parts of the financial world – from investment banking to hedge funds to private equity – your alumni contacts can become a source of financing, marketing and more.

Troutwine admits that it is not absolutely necessary to obtain an MBA to get a job in private equity, for instance. But it remains a valuable “stamp of approval” and credibility builder for any prospective employer.

What’s your take? Do you think an MBA is necessary, or valuable, for a career in private equity? Add your comments below.

Venture capital firms want a piece of the angel investors’ lunch. A growing number of established venture capital firms are investing smaller amounts in early-stage companies, in an effort to “seed” more successful start-ups.

Dow Jones reports that many are investing in consumer Internet and software-as-service start-ups, since many of these types of companies are succeeding faster and using less capital upfront. The VC firms are investing much smaller amounts than usual – often five-figure sums – to help entrepreneurs get started and have a seat at the table when the company takes off and needs next-round financing.

The article mentions FirstMark Capital as an example of a firm that has set up a formal program to sprinkle small sums into a larger number of early start-ups. To help, FirstMark is speeding up the approval process for investments and agreeing to more friendly terms for entrepreneurs.

Other firms, such as Norwest Venture Partners and Adams Street Partners have taken a different approach. They are handing over money to angel investors or seed-fund managers and giving them carte-blanche to invest as they see fit.

These investors are following the recent successes of other firms that created formal seeding programs a few years ago. Charles River Ventures, for example, began seeding a select number of start-ups in 2006 and is now seeing the benefits. Its portfolio of 22 young companies has generated more than $30 million in total revenues in 2009, according to the Dow Jones article.

One drawback is the hidden message that a venture capital firm sends out if it decides, for any reason, not to invest in the start-up at the next round of capital raising. While it could be for unrelated reasons, not investing has the potential to “spook” over venture capital investors and make it more difficult for the start-up to raise the necessary funds.

What’s your opinion? Should venture capital firms make a concerted effort to help very early stage start-ups get off the ground? Should it be a formal program? Add your comments below.

Fundraising efforts for the private equity sector are up 26% in the first half of 2010 versus a year ago. Does this mean the industry is storming back to where it was before? Not so fast, says David Rubenstein, Co-Founder and Managing Director of The Carlyle Group.

Rubenstein was interviewed on-air recently by CNBC during the 6th annual Aspen Ideas Festival. He says the best opportunities in private equity are shifting to the big emerging markets of China, India and Brazil. And while there still may be deal flow in the U.S. and Western Europe, it’s not going to be as robust as before.

Carlyle, which has some $90.5 billion in assets under management and 67 different funds, is investing heavily in China. But they are shifting their focus to companies that produce products for the Chinese domestic market, as opposed to export-oriented firms. Examples include a fisheries company that sells 75% of its products domestically, and a milk producer.

Rubenstein is bullish on Africa right now, too, as an overlooked emerging market. While Africa has received a lot of attention from Middle Eastern and Asian investors (particularly China and Japan), American investors have tended to ignore it.

“You have to distinguish between the various parts of Africa,” Rubenstein said. “I think the greatest opportunity right now is probably in South Africa, then sub-Saharan Africa. Natural resources are really the dominant thing area where you’ll see growth, but as countries get wealthier, there are going to be more consumers that need financial services and telecommunications services and other kinds of products.”

It all underscores the growing globalization of the private equity industry. Not simply because the U.S. economy is in recovery mode. But because of shifting economic clout, says Rubenstein. The United States represented 48% of the world’s GDP after World War II. Today, the U.S. represents only about 22%. So increasingly, PE firms will be looking for opportunities around the world.

“Also, as Americans have taken their private equity skills to other parts of the world, indigenous private equity firms have set up and now they’re investing in these countries by themselves, without Americans being involved.”

What’s your opinion? Do you see a growing and permanent shift toward greater private equity investment overseas? Add your comments below.

We recently caught up with Pam Lassiter, Author of The New Job Security and Principal of Lassiter Consulting. Pam has provided sage career advice for over 30 years and has seen many up and down job markets. Her comments are both insightful and practical advice for someone looking for private equity jobs. Here is an excerpt from that interview.

Job Search Digest: From a job seeker standpoint or somebody who may be in a position but thinking about making a change, how important is mindset during times like these?

Pam Lassiter: That’s a great question, because mindset controls everything.  Let me give you an example.  If we don’t feel like we are of value on top of our game, we can project that really easily.

I was talking to a president once of a company that was complaining about somebody that took four handshakes to get into him, and finally got to him on a phone call, spent five minutes talking about himself, the job seeker did, and five minutes, you know, that’s a long time, especially on a phone call, and then ended up with saying, “Our mutual connections said you’d have some ideas for a guy like me.”  Really irritated the president incredibly.

“Like me” is a reflection of a mindset of somebody that doesn’t know what they’re doing and doesn’t really care; it’s waiting for other people to take care of them, and that doesn’t present well.

So mindset and focus tied together with strategy is an important part of distinguishing who you are.

Job Search Digest: So the lesson learned there is when networking with people, what point of view are you taking?  If you’re taking ‘the world revolves around me’ point of view it’s probably not going to help you in your networking process.  Is that right?

Pam Lassiter: Very insightful comment.  In fact, I had three points I was going to leave your members with, and that was one of the three — it’s not about “me.”  Finding the right work is not about you.

That may sound counter-intuitive, but the more you think about you, the less the market is interested in you.  The market is interested in themselves.  You’re talking to a partner at a private equity firm or a venture capital firm about how what you’re looking for in a job and how you are interested in doing these sorts of things, you know, that’s a vague interest.

But the primary interest is how they are going to make exits.  How are we going to get out of the deals we are in successfully in a down market?  And if you start talking about that side and the areas that you have helped work on that have made that happen, they’re going to pay a lot better attention.  The mindset there is that it’s not about you, it’s about them, and it’s talking in their frame.

In The New Job Security I talk about market for mutual benefit, and that has to do with your resume’ and your elevator story and all your communications.  If you’re talking about their best interests and their buzzwords, which you can pick up in the job listing that you’ve got on your board.  You can pick up the right vocabulary right there.  And if you start feeding that back to them with profitability, that puts you in a very different position, in a very different light from the point of view of the partner that’s making the decisions.

Job Search Digest: We’ve said that time and time again in our communications with our members.  Firms are going to hire to fill a gap, and those gaps –  they’re not static.  Because with every new portfolio company, every new financing challenge, every new sales challenge, those are all opportunities that then create something where the right person at the right time with the right skill set, somebody that they can plug in right then and there, hit the ground running and solve their problem, they’re going to hire that person.  It’s not going to be – and it may be a situation before they’ve even though about the position or a job description.  What they know is they have a problem now that needs to be fixed.

Pam Lassiter: You’re on to something.  It’s a gap concept.  Let me broaden that a little bit to the concept of pain.

So looking for the pain within a company and a gap may imply a job that’s coming. If you go a little bit earlier upstream, and where are they feeling the pain, and they are around some of the areas you’re talking about, the financing the deals.

If you look at regulatory too, there are going to be lots of pain points that are coming down the pike that are going to create jobs.  And if you start thinking about where is the pain, especially with keeping up in front of some of these regulatory requirements that are coming through Congress right now, and if you can be the expert or have some ideas – nobody’s even going to have any experience.

There are going to be jobs created around these and enforcing them in compliance as well.  So it’s looking at how the marketplace is shifting and focusing on some areas of expertise that you can offer.

The rule of thumb that I’m passing on to my clients now is Jack of all trades, master of two.  And which two are people going to think about you when they’re facing that type of pain or problem to be solved?  And that’s where work gets created before it often even gets to job openings.  So you’re right about the timing and getting the conversations going.

Job Search Digest: You make such a great point about understanding what’s happening in the industry.  In private equity, hedge funds, investment banking there has been more change in the last 12 months than we saw in years and years prior to that.

And your example of new regulations is a great one.  You know, somebody who understands what’s happening in hedge fund regulation, for instance, is on top of that and really diving in and translating, you know, how is this new regulation going to change how hedge funds are able to market their funds is a significant knowledge base that every hedge fund has to deal with now.

Pam Lassiter: Exactly.  And you don’t even have to be an expert yet.  The first person that said, “I understand Sarbanes-Oxley” got work, and that person became an expert.  You have to be ten minutes in front of the next expert.

People are becoming experts all the time, and it’s impossible to be an expert constantly, because things change so quickly.  So that becomes our challenge as a professional, to stay in front of what the changes are, and to at least claim ownership, to say, “I have experience.”  Even having read the regulations coming through Congress will put you ahead of 95% of the pack right now.  And then interviewing people, talking to people about them will give you a body of opinions and expertise that you can leverage early on, before it turns into job listings.

That’s just an example.  You can hit any other place of pain too.  It’s not just government regulations, but there are a lot of things around accounting and compliance and funding and tax that will be hitting across the board on all three of your markets.

Job Search Digest: Well, and the importance, of course, if you’re going to be a player in your market, you’re going to have to stay on top of what’s happening.  But in addition to that, we see this in the jobs that are getting posted on our site, you can start to see shifts by the keywords that are included in job descriptions.  Have you seen that?

Pam Lassiter: Yes… I thought you’d been reading my book.  I write about that.  When my clients are developing resumes I take a little bit different cut than everybody else, I use product marketing.  And so you’ll hear that vocabulary coming across.

I have them start with identifying who are the target markets.  Now let’s say venture capital firms are a target market, for example.  Then you can start looking at your job listings and start getting recurring terms out of the job listings.

I don’t care what city it’s in. I don’t even care if it’s a year old, because the needs aren’t going to change too quickly and they’re going to be very similar regardless of geography, and start analyzing what’s popping up in these ten job listings that I like.  If somebody gives me ten job listings they like I can tell them what their resume’ ought to say without being an expert in their field.

And that’s something that your members can do too; analyze.  Take apart what they’re saying on your private equity job board and start analyzing the recurring terms and slap it back on their resume’ tied with profitability.  You’ll see some formats in the new job security.

So when people are skimming they will see bold-faced their words reflected back to them, tied with the profitability you have hopefully brought to your firms and in your job experience or in your education on research projects that would be of value to them, so they can skim it quickly, five seconds, ‘How’s this person going to make me money?’

Job Search Digest: We offer that same advise in the cover letter as well.  It makes perfect sense that if the cover letter is on top of the resume’ that’s the first thing that’s going to get skimmed.  And we always say, don’t plan on anybody reading your letter and your resume’ word-for-word.  And that’s the importance of those key concepts, the bolding, the formatting, because you’re trying to draw the eye to say, ‘Yeah, this person seems to be a good fit for what we have.’

Pam Lassiter: Exactly.

About Pam Lassiter

In addition to authoring The New Job Security, Pam Lassiter is the founder of Lassiter Consulting, a firm that offers career management services such as employee retention, career coaching, outplacement and more to companies and individuals worldwide.

Want to learn more? You can listen to the entire Pam Lassiter Interview (to download, right click and “save as”)

You can also pre-order the latest version on The New Job Security

Greentechmedia recently interviewed venture capitalist Ullas Naik, a partner at Palo Alto-based Globespan Capital Partners, for his thoughts on the current VC environment.

One big challenge facing VCs right now is generating liquidity through IPOs. “The VC model is predicated on the existence of a healthy IPO market,” Naik said. VC firms need a few companies from each of their funds to generate healthy 10x returns in order to boost the overall return from their funds and keep investors happy.

But economic conditions in the past two years have sucked the life out of the IPO market. Additional regulations such as Sarbanes-Oxley haven’t helped, either. Naik also feels the venture capital asset class as a whole is overcapitalized, and will have to shrink a bit to be more successful.

As a result, IPOs have all but dried up, and this lack of liquidity has made it difficult for venture capitalists to both raise new funds and to generate the kind of returns that investors became used to in the 1990s. Good VC firms are still building good companies. They just can’t access additional growth capital as easily to take those companies to the next level.

One bright spot is the growing “ecosystem” of greentech companies. The incumbents right now are building the kind of network of successful companies that will one day be big enough to acquire newer, smaller, start-up greentech companies for new technologies, similar to what took place in the IT/computing world. That’s still a couple of years away, Naik says, but it may one day be a key driver of innovation in the greentech industry.

Do you see any improvement in the environment for IPOs? Do you see venture capital as an asset class shrinking in the years ahead? Add your comments below.

Domestic LBO activity, which dropped to a low of $10.4 billion early in 2009, has rebounded and will surpass $37 billion for the first half of this year, according to an article in The Deal, using data from research firm Dealogic.

Factors such as the end of the recession, a recovery in corporate earnings and the easing in credit markets have sparked the uptick. Some of 2010’s biggest deals so far have been secondary LBOs, in which one buyout firm buys a company from another. Among the biggest so far this year are Veritas Capital’s $1.5 billion sale of government contractor DynCorp International Inc. to Cerberus Capital Management LP; Huron Capital Partners LLC’s 18.7-fold gain selling Ross Education LLC to JLL Partners Inc.; and U.K. firm Bridgepoint Capital Ltd.’s lucrative $1.4 billion sale of Pets at Home Ltd. to Kohlberg Kravis Roberts & Co.

The stronger stock market has also provided a friendlier environment for 54 initial public offerings from private equity-owned companies in the U.S., in the past 12 months.

Sponsors are once again able to line up large amounts, $10 billion and more, in debt financing from banks and other lenders. But today, sponsors must also pony up 30% or more of a buyout’s value in equity and will have to settle for far less than the 8 to 9 multiples of EBITDA they targeted at the height of the market in 2007.

The private equity industry has gone through a vast “salvage” campaign over the past two years to cut costs and trim staff. According to The Deal, they simultaneously carried out extensive repairs on their companies’ balance sheets while getting lenders to extend loans’ due dates.

Is the worst behind us? Have things stabilized to the point where PE firms will begin hiring again? Add your comments below.