Private Equity in Singapore
Would you like to work in Private Equity in Singapore? How is the market? Can you grow if you decide to work in a top Private Equity firm in Singapore? Do you have any options for exiting?
In this article, we will investigate all of the above questions and try to find out the answers.
Let’s have a glance at the flow of the article.
In this article, we will talk about the following –
- Overview of Private Equity in Singapore
- Services Offered by Private Equity Firms in Singapore
- Top Private Equity Firms in Singapore
- Recruitment Process in Private Equity in Singapore
- Culture in Private Equity Firms in Singapore
- Salaries in Private Equity firms in Singapore
- Exit Opportunities in Private Equity in Singapore
Overview of Private Equity in Singapore
The standing of the Private Equity market in Singapore is better than investment banks in SingaporeBanks In SingaporeThere are various categories of banks in Singapore - Local Banks, Foreign Banks, Full banks, Wholesale banks, Offshore banks, and Merchant banks. Top 10 banks are 1.DBS Group 2.Overseas Chinese Banking Corporation 3.United Overseas Bank 4.Bank of Singapore 5.Citibank Singapore 6.CIC Singapore 7.HSBC Singapore 8.Maybank Singapore 9.Standard Chartered Bank 10.RHB Bank. But still, since 2014, the Singapore Private Equity market has been experiencing a slump. And as a result, Indonesia and Vietnam are growing stronger in PE activity.
South Asian M&A activity has been on the rise, and the market improved by the US $32.8 billion as a result of 252 deals. However, M&A activities in Singapore have been declining. Mergermarket report also explains the same – the Singapore market, which was a key market for buyout deals, has been waning in influence and market share.
The only difference between Singapore and the other two countries (Indonesia and Vietnam) seems to be one. The family-owned businesses in Singapore want to hold onto their reign and don’t want to grow bigger (that’s why most of the deals in Private Equity in Singapore are in the middle-market and most of the deals are under the US $300 million).
On the other hand, the other two countries (Indonesia and Vietnam) have aimed to expand their businesses in emerging markets. For example, SALIM, an Indonesian-based company, and Thailand’s Chearavanont have already planned to expand their horizon in emerging markets. And also, Indonesia and Vietnam have closed deals worth the US $1.3 billion and the US $91 million, respectively.
But that doesn’t mean that the Singapore market isn’t fit to work for and grow your Private Equity career. You can still grow and learn to master deals in the middle market. In the future, maybe the market will grow, and Singapore private equity firms will close better and bigger deals.
Services Offered by Private Equity Firms in Singapore
As you know that private equity firms provide a wide range of services, here’s a list of few key services that stand out –
- Investments and advisory in scalable businesses: In Singapore, the Government gives a lot of opportunities to new business owners to build their businesses and earn great profits. Private equity firms have also decided to assist these businesses to grow and make their mark. Most of the top-notch private equity firms are built by entrepreneurs, and they can understand how hard the path of entrepreneurship is. Thus, they provide assistance in funding and in an advisory to competitive, scalable new businesses.
- Investments in M&A deals: Though the M&A activities in Singapore are slim, still private equity firms (even the bulge bracket ones) want to take advantage of the synergy of private companies. Thus, there is a fierce competition to win deals among private equity firmsPrivate Equity FirmsPrivate equity firms are investment managers who invest in many corporations' private equities using various strategies such as leveraged buyouts, growth capital, and venture capital. The top private equity firms include Apollo Global Management LLC, Blackstone Group LP, Carlyle Group, and KKR & Company LP. in terms of M&A buyouts deals.
- Investments in particular industries: Private Equity firms in Singapore don’t judge among industries. They invest both in growing and traditional industries. But there are few particular industries Private Equity firms in Singapore always aim at. They are – petrochemical, medical devices and services, pharmaceuticals, environmental engineering, and other manufacturing sectors.
- Investments in different stages of businesses: Most of the Private Equity in Singapore invests in different stages of businesses. But the top-notch ones are choosy in deciding which businesses to invest into. Most of the time, they find businesses that are at their expansion stage (wants to expand but don’t have the funds), have competitive advantages in the market, and at the same time would be scalable after expanding to yield higher returns for PE firms. As there are a lot of investment opportunities always in the pipelines, most private equity firms need to be choosy in picking the right deals to ensure maximum returns.
List of Top Private Equity Firms in Singapore
Since 1992, Singapore Venture Capital & Private Equity Association (SVCA) has been established to provide private equity and venture capital firms benefits like free registration in events, providing Preqin databases, and discounted entries in workshops and events organized by SVCA.
On their website, they have created a list of private equity and venture capital firms that have offices in Singapore and, at the same fully operational. Here’s a list of top private equity firms in Singapore that have held in private equity and venture capital market in Singapore (in alphabetical order) –
- 3i Investments PLC
- 3V SourceOne Capital PTE Ltd.
- Abraaj Capital Asia PTE Ltd.
- Adams Street Partners, LLC
- Affinity Equity Partners (S) PTE Ltd.
- AIGF Advisors PTE Ltd.
- AISB Holdings PTE Ltd.
- Al Salam Asia Pacific PTE Limited
- Altair Capital Advisors PTE Ltd.
- Ancora Capital Management PTE Ltd.
- Ardian Investment Singapore PTE Ltd.
- Aris Prime Partners Asset Management PTE Ltd.
- Axiom Asia Private Capital PTE Ltd.
- Bain & Company S.E. Asia Inc.
- Baring Private Equity Asia PTE Ltd.
- Capital Advisors Partners Asia PTE Ltd.
- CDH Investment Advisory Private Limited
- CLSA Capital Partners (Singapore) PTE Ltd.
- CMIA Capital Partners PTE Ltd.
- Credence Partners PTE Ltd.
- CVC Asia Pacific (Singapore) PTE Ltd.
- Deutsche Asset Management (Asia) Ltd.
- Emerging Markets Investment Advisers PTE Ltd.
- EQT Partners Singapore PTE Ltd.
- Everstone Capital Asia PTE Ltd.
- First Alverstone Partners PTE Ltd.
- General Atlantic Singapore Fund Management PTE Ltd.
- GIC Special Investments PTE Ltd.
- Gobi Management (Singapore) PTE Ltd.
- Gordian Capital Singapore PTE Ltd.
- Heritas Capital Management PTE Ltd.
- iGlobe Partners (II) PTE Ltd.
- JAFCO Investment (Asia Pacific) Ltd.
- Jubilee Capital Management PTE Ltd.
- Jungle Ventures PTE Ltd.
- KK Investment Management PTE Ltd.
- KKR Singapore PTE Ltd.
- L Catterton Singapore PTE Ltd.
Recruitment Process in Private Equity in Singapore
The recruitment process in Private Equity in Singapore is similar to other Asian countries but quite different than the western countries. Let’s have a look at the recruitment process of Private Equity in Singapore –
If you’re a foreign graduate:
If you’re a foreign graduate and trying to get into the private equity market in Singapore, your chances are getting an entry-level job isn’t easy. Yes, we are talking about a full-time job in any private equity firm in Singapore. First of all, you need to know a lot of key people in private equity firms to pitch and make your voice heard. Moreover, the interview process would be tougher as the firms don’t want to take chances of hiring a sub-standard candidate. And let’s say you have got through the interview and impressed the top management about your candidature; still, you need to work as an intern for a while. This period is called a “probation period.” During this probation period, candidates are judged by putting them into the real job and by testing their actual skills. If you can prove yourself in the “probation period,” then you would be hired as an entry-level full-time employee in the organization. Thus, you can understand that getting an entry into private equity in Singapore isn’t pretty easy.
So what’s the answer to cut the curve and make your voice heard? The answer is aggressive networking. This sort of networking isn’t very common in the western market. But here, you need to do it, especially if you are coming from a different country. You need to start by looking at the list of private equity firms, managing their contact details, and then finding out who are the key decision-makers in the firms. Then you need to try to connect with them and build rapport. You can do that by cold calling or face to face meetings. You will be rejected a lot, and you need to have a sort of hard skin to go through this kind of treatment. If you can do this enough, you will eventually make the connections and receive an offer. Always remember that all you need is one firm ready to accept your candidature. For that, you need to create separate cover letters and resumes in regards to the funds you’re applying for. Aggressive networking isn’t easy. But if you’re determined to enter into Private Equity in Singapore, this is the best way out.
If you see that you aren’t able to get a full-time job (as a foreigner, it wouldn’t be easy), try doing a couple of internships. Maybe eventually, the private equity firms which have hired you as interns go on extending your terms and hire you as a full-time employee. Or else you can show your internships as backgrounds and your interest in working in the private equity industry.
The interview process is almost similar. First, you need to go through an application process. If you’re shortlisted, you need to go through a fit interview to prove that you’re the right candidate for the job and for the firm. Then you would be giving 2-3 rounds of an interview where you need to present a case analysis and answer some technical questions. The second last round would be with the MD and HR, and if you’re through, then you may need to go through a likability test round (this round depends on the particular PE firm) where you will be asked for an informal dinner and would be asked to gel with people in the firm. And they will monitor how you’re doing as a part of the firm.
Singapore is diverse, and it encourages multi-cultural backgrounds. So it wouldn’t be like why you didn’t know Chinese or other languages. But yes, if you want to make your mark and stay ahead of the curve, working knowledge of Chinese will be helpful.
Culture in Private Equity Firms in Singapore
The culture in Private Equity in Singapore is different than western culture. Here, the teams are smaller. As a result, you would be able to get a lot of exposure in dealing with investments directly. In the USA or UK private equity firms, it isn’t easy for entry-level employees to get experience in dealing with top-notch investments. But in Singapore, it’s very much prevalent.
However, there is a reason behind that. First of all, unlike the USA or the UK, there are so many investments already in the pipeline. So, the MDs and Partners don’t get time to search through all of them to find out the best deals. It’s the job of entry-level employees. Secondly, the new employees don’t need to source new investments as there are a lot of investments in the pipeline. So they can invest more time and effort sorting through the right investments and get a lot of exposure early on.
In Singapore, the work culture is also not that intense. People work hard, but late nights are not very common, and there is a healthy work-life balance.
As the team is generally smaller, new employees can walk into any MD’s room and can ask questions they have been struggling with. As a result, you will grow much faster in Private Equity in Singapore than in any western PE firm (even if the size of the deal is smaller).
Salaries in Private Equity in Singapore
If you work in Singapore, you will earn a similar amount of salaries. However, as the taxes are light and Government helps in building new businesses every day, you will be able to save a lot more (think about a stable and steady economy).
According to Robert Walters’ survey, we get a glimpse of the salaries of private equity professionals in Singapore.
As an entry-level employee, you won’t be involved in sourcing investments; thus, your main work would be to execute the investments. As an analyst, in 2015, one has earned around S$80,000 to S$120,000 per annum, and in 2016, it was around S$90,000 to S$130,000 per annum.
For investment origination in both 2015 and 2016, associates have earned around S$150,000 to S$200,000 per annum, and VP Directors have earned around S$200,000 to S$300,000 per annum.
For investment execution, in 2015 and 2016, associates have earned around S$130,000 to S$160,000 per annum and S$140,000 to S$170,000, respectively, and VP Directors have earned around S$180,000 to S$250,000 per annum.
Exit Opportunities in Private Equity in Singapore
Exit opportunities in Singapore are usually two. But most of the people who work in private equity generally don’t quit their job to go in for another career opportunity. But, of course, there are exceptions.
The first exit opportunity is investment banking since there is a huge opportunity in investment banking in Singapore (after Private Equity). And the second exit opportunity for which people quit their jobs is for working in venture capital.Working In Venture Capital.Venture capital (VC) is long-term finance extended to startups with high-growth potential to help them succeed exponentially. The investors are venture capitalists who bear the excessive financial risk and provide guidance to startups to attain their objectives. In Singapore, there are quite a few venture capital firms.
Singapore Private Equity market has been experiencing a decline, but that doesn’t mean Singapore isn’t a good place to work in PE. People from other countries get attracted to work in the PE market in Singapore for two main reasons –
- First, the Singapore Government has ensured the stability of the economy, and many new businesses are being established every now and then.
- Second, the learning curve and salaries in Singapore Private Equity are quite higher than other PE markets in the world.
This article has been a guide to Private Equity in Singapore, their services offered, the recruitment process, their culture, top private equity firms in Singapore, salaries, and exit opportunities. You may also have a look at the following article for learning more about Private Equity