Is Private Equity/Investment Banking worth it if you’re not at a Megafund/Bulge Bracket?
Just looking at the Wall Street Oasis salary database, it seems like Lower MM PE Analysts make $114K + $10K SB and work at least 70-80 hours/week. Associates make more of course, but what are the chances of making it to VP either starting out of undergrad as a PE Analyst in a Lower MM fund or coming in as an Associate from a mid-tier Investment Bank? I’m working in Corporate VC at a large F500 company and I’m making like $130K for working 45 hours/week with occasional 50 hours weeks. I got rejected from every PE fund and IB I interviewed at, yet it seems like I’m making more where I’m currently at for working less hours. Is Private Equity or Investing Banking not worth it if you’re not at a Megafund or a Bulge Bracket? A lot of my friends from college are going to banks like BNP Paribas or Lower MM PE funds like LLR Partners, and they don’t seem to be making much more than me. I’m not sure how much people at banks like BNP Paribas or Mizuho make, so if anyone could provide me a breakdown of the TC of 1st year analysts at non-bulge bracket investment banks or non-Megafund private equity funds that would be really helpful. Thanks! #buyside #pe #vc #ib #bnpparibas #societegenerale #wellsfargo #macquarie #hsbc YOE: 1 TC: $132K
LMM PE objectively better later on - as you get more senior, you work way fewer hours with more autonomy for uncapped pay and better carry, with less chance of being fired than in Corp VC. * caveat - there is a lot of variance between shops, this is a view of the average case
By way fewer hours is it still like 60+?
What is the likelihood of getting to VP at an LMM PE shop given how hard it is for bankers to convert their associate position into VP?
The learning and exposure is so much better I’d work in pick PE even if you weren’t getting paid. Let’s break this down: 1 yr in: corp guy has higher pay (per hour) and chill. PE guy grinding away as a slave before computer [TC: peanuts for the hours] 3 yr in, corp guy still in the bottom of the pyramid getting paid slightly more. PE guy starts running transactions, observe and pitches in board meetings [TC 200-300K] 5 yr in, corp guy might get promoted to manager. PE guy promoted to senior asso, starts getting carry in the fund. Knows CEOs and CFOs of many companies [TC up to 500K] 10 yr in, corp guy likely still stuck climbing the corp ladder. PE guy is VP/ principal. Your’re still working 50-60 hours but at this point you’re heavily invested, people look to you for direction and decision. You are running businesses and have a team of juniors working for you. [TC potentially a mil+] 15 yrs in, corp guy maybe makes to C-suite but more likely they hired someone with more experience (potentially from PE). PE guy makes partner, significant carry in investments. Makes more strategic decisions with a team under him. [TC: tied to fund performance but you can expect more than a couple bucks.. 5M+] So yeah, let’s compare based on first yr analyst hours!
This. It’s all about the long game, kids
Different strokes for different folks I guess. I’m curious though, would you say PE is more competitive than IB, and if so to what degree? When my friend and I were recruiting for IB out of undergrad, I ended up getting a PM internship while he got an IB internship at a top firm. After our internships, I got a return offer and got placed in one of the most prestigious groups at my company while he didn’t get a return offer and had to settle for an IB/PE gig at a 10–person merchant bank. He’s slaving away for 100+ hours/week making a $120K TC while I’m working 45-50 hours a week and have a TC of $132K. Does what you said above apply to him and he really got the better deal, or am I in an equal if not better position despite the fact that I’m in the world of Product rather than high finance?
Looking at your TC and YOE, no I highly doubt PE and IB is worth it considering the trade offs. You have a sweet deal and I would accept that as just being given a unique circumstance. Trust me those PE/IB colleagues of yours are likely already only one year in and very much feeling the burn out. I had a classmate get a PE gig her first year out and by year 2 she was grinding hard for the GMAT so in her words, she could escape that life for an Ivy League mba to switch to a cushy brand management job with less hours and still a six figure salary
PE only makes real big money at Principal and above (and VP in some cases). However, if you think about it, every partner seat given means a smaller share for the current partners. So why would they promote you? It’s extremely difficult to get a PE partner seat and is totally dependent on luck and timing (does a fund have a partner retiring or dead?). I know some very smart people who could never get past senior associate or VP in PE and now do something completely different.
Never worth being overworked, fat, and unhappy in life at a PE firm for a little extra dough. The only people who make money at these firms are directors, VPs, and partners. The rest are just fillers. Take a step back and ask yourself what you really want in life
This is correct, and it’s amazing how so many smart people don’t get it.