The talent shift reshaping private equity
Private equity has long been viewed as an industry where professionals stay put. Long-term incentives and carry structures have traditionally rewarded patience, making career moves relatively uncommon.
According to Daniela Braemisch, Executive Partner and Head of Frankfurt, that dynamic is changing. In a recent interview with Finance Magazin, she explained why Directors and Partners are now more willing to change employers than at any point in recent memory.
According to Daniela Braemisch, Executive Partner and Head of Frankfurt, that dynamic is changing. In a recent interview with Finance Magazin, she explained why Directors and Partners are now more willing to change employers than at any point in recent memory.
Watch the interview in German here
Daniela's profile
A shift that started
with Covid
Daniela traces the roots of this shift back to the pandemic. Since then, market uncertainty around deal activity, fundraising, geopolitics and portfolio performance has steadily reshaped the industry. Over the past two years, candidate movement has accelerated noticeably.
Importantly, this isn't confined to one corner of the market. Daniela is seeing increased mobility across funds of different sizes, strategies and geographies.
Importantly, this isn't confined to one corner of the market. Daniela is seeing increased mobility across funds of different sizes, strategies and geographies.
Why the old incentives
no longer hold
Historically, private equity professionals stayed the course, seeing fund cycles through in anticipation of a significant carry payout. According to Daniela, that equation is beginning to change. Longer holding periods and delayed exits have made hurdle rates harder to achieve, meaning carry is taking much longer to materialise, while fundraising and liquidity challenges are affecting firms across the market, regardless of size.
At the same time, a more mature and competitive industry has created new career paths, from launching independent investment strategies and joining search funds to building boutique firms. Faced with years of uncertainty before a payout, many professionals are choosing to take greater control of their careers, prioritising opportunities that offer immediate impact, greater autonomy and stronger long-term potential.
At the same time, a more mature and competitive industry has created new career paths, from launching independent investment strategies and joining search funds to building boutique firms. Faced with years of uncertainty before a payout, many professionals are choosing to take greater control of their careers, prioritising opportunities that offer immediate impact, greater autonomy and stronger long-term potential.
Big brand no longer
means big draw
One of Daniela's strongest observations is that a fund's brand name has become less influential than it once was. Instead, candidates are placing greater value on:
This is one reason talent is increasingly gravitating towards mid-market, lower mid-market and small-cap funds. Founder-led firms often offer faster decision-making, broader responsibility and less internal bureaucracy than larger international platforms, where strategic decisions are frequently made elsewhere.
As capital continues to flow into these segments, talent is following.
- A collaborative culture where they can genuinely influence decisions
- Clear opportunities for progression and succession
- Greater autonomy and closer proximity to decision-makers
This is one reason talent is increasingly gravitating towards mid-market, lower mid-market and small-cap funds. Founder-led firms often offer faster decision-making, broader responsibility and less internal bureaucracy than larger international platforms, where strategic decisions are frequently made elsewhere.
As capital continues to flow into these segments, talent is following.
What firms are looking for now
The profile of a successful private equity professional has evolved alongside the market. Technical ability remains essential, but Daniela believes firms are placing increasing emphasis on qualities that have become more valuable in a tougher environment:
These softer skills are becoming increasingly important differentiators as AI begins to automate more technical aspects of investing, from modelling and sourcing to elements of commercial analysis. The ability to build trust with entrepreneurs, management teams and sellers is becoming an even greater differentiator.
- Resilience and adaptability, particularly in a slower deal market
- A genuine appetite to originate and execute transactions
- Strong personal networks
- Humility and emotional intelligence
Generalists are making
a comeback
Sector expertise remains important, particularly at larger funds, but Daniela sees growing demand for professionals with broader investment experience at the mid-market and smaller end of the market.
Sector trends can change quickly. Industries such as industrials and manufacturing, which were relatively overlooked 18 to 24 months ago, are now attracting renewed interest following years in which software and technology dominated investment activity.
In that environment, versatility can prove more valuable than deep specialisation.
Sector trends can change quickly. Industries such as industrials and manufacturing, which were relatively overlooked 18 to 24 months ago, are now attracting renewed interest following years in which software and technology dominated investment activity.
In that environment, versatility can prove more valuable than deep specialisation.
Looking ahead
Daniela expects the shift towards smaller funds to continue, with many candidates watching the market over the next 12 to 18 months in anticipation of stronger exit activity, including an eventual wave of 2021-vintage "Covid deals".
While cautiously optimistic, she acknowledges that similar expectations have surfaced before without always leading to sustained market recovery.
Her view is that moving from a large fund to a smaller one no longer represents a step backwards. Increasingly, the professionals thriving in today's market are prioritising culture, autonomy and ownership over brand prestige, while keeping a close eye on AI as the force most likely to reshape the industry over the coming years.
While cautiously optimistic, she acknowledges that similar expectations have surfaced before without always leading to sustained market recovery.
Her view is that moving from a large fund to a smaller one no longer represents a step backwards. Increasingly, the professionals thriving in today's market are prioritising culture, autonomy and ownership over brand prestige, while keeping a close eye on AI as the force most likely to reshape the industry over the coming years.