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Hi everyone - I'm a first year associate at a major midwest law firm working in the private equity group. Things are busy enough right now, but I'm a little concerned with the recent dip in the financial markets that we could see a serious work shortage across our group. My firm has also been expanding aggressively and spending a lot on lateral talent lately, which I think could exacerbate the issue (or protect against it, I suppose), and has led to some cutbacks in other areas, like having our firm holiday party at a table tennis club. I know my firm laid-off a bunch of people during the last recession, but I've been told our bankruptcy group would help keep hours up and I know our work feeds into them a lot. Thoughts? Maybe I'm just paranoid...

Disclaimer: I do not work in PE

You can't concern yourself with the strength or weakness of the global equities markets. Do your job and as a first year focus on building whatever skills you can and getting exposure where you can.

Besides, PE--at least LBO's--should benefit from a hit to public valuations. I'd be more concerned about rising interest rates to the PE business than lower valuations of public companies. The whole business model is buying companies with debt for as little as possible. Relax.

The last recession was wild and deeply structural. Finding weakness in every financial institution because everyone invested or sold or held onto garbage marketed as AAA investments meant everyone was holding as much cash as they could to cover their asses without pulling a Lehman. If the only issue now is an unnecessary trade war that will blow up as soon as new administration comes in... well that's just different.

Focus on what you can control--your work product--and don't endlessly stress the things you can't.

Oh nice, OP. Hope you are enjoying Kirkland.I heard they were slowing down quite a bit. Kind of think you will be alright as they will be a laughing stock if they attempt mass layoffs.

PotatoSalad wrote:Disclaimer: I do not work in PE

You can't concern yourself with the strength or weakness of the global equities markets. Do your job and as a first year focus on building whatever skills you can and getting exposure where you can.

Besides, PE--at least LBO's--should benefit from a hit to public valuations. I'd be more concerned about rising interest rates to the PE business than lower valuations of public companies. The whole business model is buying companies with debt for as little as possible. Relax.

The last recession was wild and deeply structural. Finding weakness in every financial institution because everyone invested or sold or held onto garbage marketed as AAA investments meant everyone was holding as much cash as they could to cover their asses without pulling a Lehman. If the only issue now is an unnecessary trade war that will blow up as soon as new administration comes in... well that's just different.

Focus on what you can control--your work product--and don't endlessly stress the things you can't.

Agree with most of this, but my memory from looking at all those "private equity deal volume over time" charts is that private equity deal activity tracks regular M&A volume pretty closely - it's cyclical, not countercyclical. When times are good, valuations are rising, so it's easy to borrow, and all the targets have hockey stick financials. When times are bad, lending dries up, your returns look like crap because you're writing down all these port co's that you can't sell, and shittier funds start going under.