September 20, 2016 by texasbbacareerservices
Tyler Pearson, SMU BBA Alum 2010
Major: Finance, Minor: Economics
Employer: Argonaut Private Equity, Associate
Why Private Equity?
Private Equity firms invest in non-public companies, taking significant ownership positions, improving operations, and then exiting the position. Working in Private Equity allows analysts to experience the full spectrum of business disciplines, pairing the quantitative skills of investment banking with the qualitative skills of consulting. I regularly build financial models, negotiate with entrepreneurs, structure deals, conduct due diligence, and analyze strategy – no other profession allows junior people such access or influence. Especially coming out of school, you are looking to build a foundation that will equip and enable you to enjoy a successful career in finance; Private Equity does that better than any other profession.
With $3.0 billion deployed and $600.0mm in our current fund, Argonaut is uniquely positioned in the region. No other funds in the region match our size or capability. As a result, Argonaut sources most of its deals in a proprietary fashion before firms on the Coasts are made aware of the opportunity. Second, Argonaut possesses a sterling reputation for being fair and honest. When structuring a deal, we work hard to align the interests of all parties involved. We are not operators, so maintaining a positive relationship with management remains critical throughout the investment life. We take our reputation seriously, and as a result, entrepreneurs want to partner with us. Finally, Argonaut provides analysts the chance to work with an exceptionally smart team with world-class deal experience. For example, Steve Mitchell, Principal and Managing Director of Argonaut, ran Mark Cuban’s private equity investments until George Kaiser, Billionaire investor and philanthropist, convinced Steve to join Argonaut. These are the caliber of people you want to work alongside.
What have your experiences been like as an Associate at Argonaut?
Argonaut has been my favorite work experience by far. In my brief stint with Argonaut (joined in February 2016), I have worked on a real estate project in Arizona, analyzed an automotive company in Michigan, purchased an Oilfield Services Company in Texas, and researched dozens of other opportunities. The biggest difference between Argonaut and my previous positions has been the level of access, both within Argonaut and with the companies we invest. I can confidently say my work has had real impact on the decisions being made by our investment committee.
What qualities do I need succeed in Private Equity?
You absolutely have to have technical finance and accounting skills to be an effective private equity analyst. Financial modeling comprises a lot of my day-to-day. Also, you have to have excellent interpersonal and communication skills. While our reach and capabilities are extensive, Argonaut itself is a small team, so communication is paramount. Next, you need to be a deep analytical thinker. At Argonaut, we solve complex problems. This requires higher level thinking and creativity to generate a solution. Finally, you need to take ownership of your work product. You are responsible at Argonaut. While that might sound scary, it’s actually a tremendous opportunity. For instance, when you work hard on a model for a potential investment, you circulate that model to LPs, co-investors, and other interested parties. It is your name on the model, so you receive the credit, even as an analyst.
What words of advice would you give?
When starting your career in finance, there are two primary considerations: the team and the deal experience. Be sure to surround yourself with the smartest people possible. This will challenge you and enable you to maximize your learning. Second, you need to see a wide variety of deals. No two deals are identical. The more you see, the more you will discover, helping you build that strong foundation.