Recruiting for a workforce is not something done at random. There are actual cycles in which recruitment takes place, especially for financial institutions like private equity firms. That is not to say that you cannot recruit new professionals outside the cycle, but doing so is not generally the norm. Hiring on-cycle or off-cycle for private equity firms are different practices that ultimately both find use depending on the circumstances. Understanding the difference between these two types of recruiting is essential to ensure you take the proper measures regardless of the cycle you are in when searching for new talent to fill the ranks.
On-cycle recruiting is the more common and important recruiting cycle for equity firms across the country. On-cycle recruiting is extremely chaotic and lacks any form of overarching coordination. All the firms do the bulk of their recruiting within the same week and feed into the interview process to ensure that the recruits are actually suited to become full-time employees.
Generally speaking, the on-cycle recruitment period favors larger, better-funded firms who will be able to fill their ranks within this week. In many cases, they even offer positions to candidates who will be unable to work until a later year. For example, during the on-cycle term for 2019, many firms offered positions to candidates who would not be able to start working until 2021.
The on-cycle caters to larger firms and will tend to leave smaller or newer firms in the dust since the best and brightest candidates will be scooped up before these other firms will even get a chance to speak to them. However, the on-cycle does not last long, and it is not the only option available to private equity firms when it comes to bolstering their ranks.
After the week of chaos that is on-cycle recruiting for private equity firms, the off-cycle begins. The off-cycle, however, does not come to an end until the start of the following on-cycle recruitment process. However, what the off-cycle process means differs depending on whether you were one of the larger firms or the smaller ones. For larger firms, the off-cycle is used to replenish ranks when employees suddenly leave and are forced to find someone to replace them in the middle of the normal work period. So, off-cycle recruitment is a chance for these firms to find candidates who can serve as effective replacements.
For smaller firms, the off-cycle is the prime opportunity to get employees to begin with since the larger firms left behind these candidates. As a result, smaller firms will have less competition seeking out employees during the off-cycle than during the on-cycle.
Recruiting during the on-cycle or off-cycle is less about finding the best one and more about what you can offer amidst the chaos of the on-cycle recruiting period. Ultimately, the on-cycle is weighted in favor of larger firms making bigger offers to their potential hires. Off-cycle recruiting allows smaller firms to reach full operational capacity but is also used by these larger firms to replenish their ranks when they lose employees. At the end of the day, both types have their benefits, but the on-cycle is when all the top talent gets scooped up by the larger firms.
Fortunately, finding qualified talent for private equity is still extremely feasible for any sized firm. We at Preston & Company hunt tirelessly for highly qualified financial talent that can quickly fill the ranks of any private equity firm. So, when your company resource is people, you will want to contact the best people resource. Please feel free to contact us at any time.