Jon Gray still remembers what it was like when he was hired as an entry-level analyst at a seven-year-old private-equity shop in New York City in 1992.
"It was a tiny place ... I think there were 80 or 90 people," Gray said of Blackstone, a firm that would go on to become the world's largest alternative investment manager and, during Gray's time as head of global real estate, its largest property owner.
Fresh out of the University of Pennsylvania, Gray was interviewed by the Blackstone cofounders Stephen Schwarzman and Pete Peterson themselves. He couldn't have predicted that he would eventually be named Blackstone's president and chief operating officer in 2018, becoming one of the most powerful executives on Wall Street.
"For me, a kid from suburban Chicago, I was like, 'Oh my gosh, this seems really exciting.' And it was obviously terrifying being interviewed," he recalled. "And by the way, starting was terrifying. I remember being so nervous having my first job here."
Gray's first-job jitters likely match how many analysts feel when they start at Blackstone, or when prospective employees get summoned for their first interview with the company. After all, Blackstone, which has more than $560 billion in assets under management, is among the most ironclad fortresses on Wall Street for job seekers.
Blackstone was ranked as the hardest interview among private-equity firms on Wall Street Oasis, a website that aggregates data submitted by users into reports about financial firms. The company ranked in the 99th percentile, beating out more than 100 other PE shops including Bain Capital, KKR, and the Carlyle Group.
Schwarzman, Blackstone's CEO and chairman, told Business Insider in 2019 that when looking to hire, the firm is after a "perfect 10" candidate. He's searching for "synchronicity" in a candidate's ability to frame an argument, he said.
Read more: Meet the 4 dealmakers driving Blackstone's $325 billion commercial real estate portfolio
And while the bar has been set high for Blackstone candidates, those who clear it are rewarded generously — particularly those who land in front-office, PE-focused positions.
Should you make it over the finish line and get offered a job at Blackstone, your first-year analyst compensation package would be in line with an average $96,100 base salary and a $40,400 bonus, for total compensation of $136,500, according to user-submitted data on Wall Street Oasis.
For first-year associates, those numbers go up to an average base salary of $152,800 and an $85,000 bonus, for total average comp of $237,800.
Blackstone declined to comment to Business Insider on compensation matters.
When assessing new recruits, Gray said, "the most important thing is to find people who really care a lot."
"At a place like this, we have relatively few people," he said, "and we really need people who care. And that to me doesn't matter if you're hiring a CEO of a portfolio company, or a Blackstone partner, or an analyst, or an assistant, or somebody in finance or technology."
Out of some 19,000 applicants for the company's 2020 first-year analyst class, just 94 people were hired — an acceptance rate of 0.5% — according to data that Blackstone shared with Business Insider. Successful recruits came from more than 50 undergraduate programs worldwide.
Blackstone said that it employed just over 3,000 people and that it had hired more than 400 people in 2020.
And while large among PE shops, Blackstone's headcount is still smaller than that of other Wall Street titans such as BlackRock (more than 16,000) or Goldman Sachs (roughly 39,000).
Want to be one of the lucky few who get hired at Blackstone? This guide is for you.
We spoke with Gray, headhunters who recruit for the firm, and Blackstone's global head of human resources to learn what it takes to stand out. From how to ace interviews to deals you need to be familiar with, here's what they told us.
In a Blackstone job interview, be ready for tough questions
When interviewing candidates for junior positions like analysts or associates, Blackstone asks questions that probe candidates' analytical and critical-thinking skills.
Charlie Kershaw, a partner who runs the private-equity recruiting practice at Dore Partnership, a New York-based firm that does hiring work for Blackstone every year, identified three variants of questions that might come up:
- "Describe ways in which you've demonstrated entrepreneurial acumen."
- "Describe times in your life where you've faced major challenges and overcome them."
- "Describe times where you've challenged the status quo or challenged opinions."
Tom Daniels, a recruiter at the search firm Spencer Stuart who also regularly works with Blackstone, said that in the interview, Blackstone candidates should be transparent about their track record and motivations.
Interviewers "always want to know: Why do they want to do this? Is it logical?" Daniels said.
"They also want to understand the decisions people have made in their careers and why," he added. "And it's not like it's bad if someone made an unwise career move. They want to know why they made that decision and what they learned from that, and what did you do with that information once you learned it?"
Interviews at most Wall Street firms also typically include more technical questions, such as testing candidates financial-modeling skills.
Schwarzman previously told Business Insider that he asked candidates for more senior roles to analyze the firm's past deals. "Do you think that was a smart thing? A good deal or a bad deal?" he might ask. "Do you think they should have increased the price? Should they have increased more? Should they have waited longer?"
Paige Ross, Blackstone's global head of HR, said she kept an eye out for a warning sign in candidates' answers.
"I look for too many references to 'I' versus 'we,'" she told Business Insider. "Most people do things as part of a team, and I want to see candidates accurately reflect that."
The application and interview process for junior-level positions is not that much different from the process for senior hires at Blackstone. But there are more résumés at the junior level.
Typically, if Blackstone vets a résumé and likes what it sees, it'll schedule an interview with the candidate, who meets with a member of Ross' HR department. If all goes well, the candidate will then meet with various members of Blackstone's business, depending on where it may be hiring.
Of course, this year it has shifted to virtual meetings, but it has still onboarded more than 400 people, from lower-level analysts to senior executives.
Blackstone looks for certain character traits in candidates
Gray likened Blackstone's corporate culture to a team sport.
"You want to get people who treat other people nicely, because the culture here is the essence of the place. Lots of investment firms haven't lasted the test of time, and we're really trying to build an enduring institution," he said.
"And to do that, you need a very positive culture — so having people who treat others nicely, and then you really want people who have a sense of team play."
Gray said he liked athletes because they know how to work with other people to win.
"To be a winning varsity lacrosse player, or whatever that sport is, there's often an element of perseverance, but there is this sense of team play. And I think about the investment process and everything we do as team play," he said.
"We raise capital from our investors, which requires the capital-raising folks as well as the investment people. We make investments, which requires the deal people, finance people, technology people, data science — everyone is working. So you can't have a lot of solo artists."
Daniels said that Blackstone isn't afraid to think outside the box when filling a position, either internally or at one of its portfolio companies, and that the firm applies that to its hiring at all levels. For instance, if Blackstone were running a search for a C-suite executive at a portfolio company, it would be willing to consider candidates who haven't yet held that type of position.
"Sometimes you can get someone who is a little hungrier, who has learned the lessons well and may have more runway and are less stuck in their own world and stuck in the past," Daniels said. "I think we have solved projects with them by having that openness."
To put yourself in the best position to be considered, though, you should demonstrate strong research skills, Kershaw said.
That means coming prepared with a clear understanding of Blackstone's history and some of its top investments. "They welcome people who can challenge assumptions and the way things are done currently," he said.
The ability to back up an argument is just as important as making one, so strong quantitative skills are a must.
"They look for people who are more entrepreneurial, are generally more read and have more of a breadth of opinions," Kershaw said, "and even at an earlier stage demonstrate that they have some leadership capacity."
Come equipped with knowledge about Blackstone's recent deals
As much research as Blackstone does on its candidates, its executives also appreciate when their candidates research them.
Come to the interview with a working knowledge of some of the firm's latest deals — and if you want brownie points, read up on its history, whether it's Schwarzman's autobiography, "What it Takes: Lessons in the Pursuit of Excellence," or "King of Capital: The Remarkable Rise, Fall, and Rise Again of Steve Schwarzman and Blackstone" by David Carey and John E. Morris.
Here are some recent deals and developments at Blackstone you should be aware of if you're applying for a position in 2020 or 2021:
- Its purchase of a 49% stake in three historic Hollywood studios from Hudson Pacific.
- Its investment in Oatly, the Swedish oat-milk maker.
- Its push into growth-equity investing, led by Jon Korngold. The firm has invested in smaller, fast-growing companies rather than large buyouts; one of its notable investments was in MagicLab, the owner of the dating app Bumble.
- Its focus on data and tech. Over the summer the firm hired Christine Feng, a director of corporate development at Amazon Web Services, to help scout out tech deals.
- Its expanding roster of operating partners, or industry vets who help manage Blackstone's portfolio companies.
- Its traditions, including its annual competition among junior execs to pitch the firm on investing in a charity of their choosing.
Some of Blackstone's top brass started as analysts or associates
They started from the bottom, now they're here.
Some of Blackstone's most senior personnel joined the firm early in their careers and at relatively junior levels.
Gray started as an analyst in 1992. Joseph Baratta, the firm's global head of private equity and senior managing director, joined in 1998 as an associate. And Kenneth Caplan, a global cohead of real estate, crossed over from real-estate investment banking into private equity in 1997.
That's one message Blackstone emphasizes in its sales pitch to new talent: It's a place where people can forge their careers, not just pass through on their way to greener pastures.
"Every day I feel like it's a new challenge and I learn something new," Gray said, adding that he wants young recruits "to have that same sense that there's unbounded opportunity, that if they're great at what they do there can be a very steep upward curve."
He also reflected on spending his entire professional career at Blackstone, working mainly in one skyscraper: the firm's headquarters at 345 Park Ave. in New York City.
"What's amazing is same office, different floor," Gray said. "I've been coming back to the same place over and over again."
