I see a lot of people comment about PE just being banking 2.0 or whatever, but how many others actually had a significantly worse experience in their PE gig? I'm a year in (MM NYC) and feel like my quality of life is significantly worse than at the one-year mark in banking (and nevermind compared to if I had stayed on as associate).
In terms of work content, I don't think I really find investing any more interesting than banking. Anything can get monotonous when you iterate on 50+ versions of it. I do find the work a bit more challenging, but not exactly in a fulfilling way. Instead of alphabetizing logos or making bar charts, I'm writing some convoluted SUMIFS formula on some data pull or troubleshooting 20 data tables after I've reworked a formula that no longer has X as a simple input. If you ask me which I'd rather be doing at 2AM while counting down hours of sleep, it's the mindless monkey shit for sure.
Hours wise, I really struggle with the lumpiness of deal sprints. Maybe some people prefer it for "visibility," but I think losing like 6-8 weekends in a row is brutal for my mental health, not to mention you could go 10 or 15 weeks sometimes if you're on a particularly shitty deal or back-to-backs. So far, it's felt like I'm on a deal sprint more often than I'm not, so it's been a pretty consistent 80-100 hours a week. And once you have PortCo's at a MM firm, there's no real "non-deal mode" 50-60 hours type stuff. Realistically I definitely had bad and very bad weeks in banking sprinkled in but I wasn't working more than 70-80 regularly.
Culturally, I feel like I'm consistently walking on eggshells. In my banking role, the junior bullpen all hated their jobs, laughed about it, and commiserated. I feel like my current firm doesn't have any room for that since it's heavily career track and everyone views it as their long-term future. I know the saying is to never become friends with coworkers so maybe I'm naive, but I feel my interpersonal relationships in IB were far stronger than now. Talking to anyone above you here is just top tier schmoozing and absolutely ZERO pushback. I imagine IB gets more cutthroat too at the higher levels where promotion becomes tougher, but at least in my group the threshold for promotions seemed relatively attainable without becoming a different person entirely.
Which brings me to - there's a particular intensity to PE that I was ill-prepared for. It feels like you have to care so much more than in IB. This makes sense in that PE work is higher-stakes at an individual level, but it definitely feels like it isn't for everybody. I don't feel like I've ever been a slow worker - quite the opposite even - but it feels like I'm always behind or not hitting the team's expectations. I'm actually not even sure if I'm fucking things up (no one has really indicated as such), or just that they regularly operate at a higher level of micromanagement than I'm used to. Personally, I do truly feel I'm working pretty close to my max capability given my level of give a fuck. Admittedly I've always been going through the motions a bit with work (I don't ever think I can be that guy that throws himself into the job entirely), but where I succeeded in spite of that mentality in IB, it might be causing my downfall in PE.
Maybe I was particularly lucky in banking and somewhat unlucky in PE (which I'm trying to gauge from this question). Banking was tough but I was decently respected and had a manager that at least somewhat tried to reduce weekend work, manage timelines, and stay mildly receptive to feedback / input. I guess also given the constant turnover and average tenure in banking, it became easier to build a reputation over shorter periods (and subsequently get more trust / freedom). It might also be worth mentioning that the general "prestige" of my PE firm is marginally higher than my former bank so maybe that's where I went wrong. Most of my coworkers are from better banking programs, so culture may just be representative of those firms.
Finally, I think I was a bit more tolerant of the BS at 22 than I am at 25. Maybe if I could reset my brain to my fresh college grad self, I could put up with more of the lack of control and respect. I knew I was going back to the bottom of the totem pole, but didn't expect to reset as much on softer skills side. I've tried to look for more objectivity by comparing to my analyst experience given that establishing human capital is natural. But at the same time, you'd want the experience and years to count for something.
Unfortunately I guess there isn't much point to this post, but just curious if others are in the same boat. I do have quite a few friends at other firms who don't seem to be having the same experience. Realistically I know my PE stint will be relatively short, and though banking was somewhat better for me, chances are I move on from the general industry entirely. I guess misery just loves company and I'd feel better knowing it's not just me that got duped into thinking PE was some kind of promised land.I’m
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Bump - interesting read.
Feels kinda relevant to this thread, but FWIW I’ve been evaluating returning back to the sell-side for a couple years now. I miss the reliability & career path of it all; not to mention I didn’t hate the client work - I hated some of the bosses that screamed rapid turnarounds when, now, as a mid-level / early senior, I see how much wiggle room there really is in timeline deliverables.
Not to mention, I have friends who stuck it out and are VP/Directors now from lmm+ banking who have magnitudes more saved up than me & make 2-3x my annual cash comp annually (even in this rougher deal environment). My carry isn’t even real for 5-7 years. And I’ve been at several firms at this point.
I would never join a sweat shop on the sell side, ever, but if there was an interesting role with solid comp & trajectory, that got me home at my current 5-8pm daily timetable outside of sprints….I’d consider it heavily. FWIW, That 5-8pm excludes heavy deal work periods where even if I head home, I’m grinding 70-90 hours a week or more to close.
This is a helpful perspective. Also reminded me of another observation I wanted to add and kind of curious as to your take. May be just my subjective experiences but I feel like the mid-levels in PE work harder than in IB.
All based on “deal mode,” but that seems to be more often than not based on the staffing at my firm. I can’t remember any of my sell-side VPs doing much besides delegating/reviewing, leading calls, and making sure processes progressed logistically. They were out of the office by a reasonable time and had some semblance of a life outside of work (gym / significant other / drinking buddies). It was something to aspire to once you put your time in. My VPs now on the buy-side are often online till midnight with bankers / lawyers / consultants, calling in while on vacation, even digging into models to massage numbers and whatnot. Most leave the office quite late and are still ordering seamless alongside the junior bullpen. The few times we’ve gone out to drinks and such, they’ve been there refreshing their emails even more than the associates.
YMMV, but it just feels like there isn’t even light at the end of the tunnel here.
I don’t doubt it. There’s got to be a rational explanation right? I’m thinking incentives. Like is the PE midlevel more easily able to connect his effort on a deal to an impact on his future . . eg maybe his path along partner track could turn more meaningfully on a deal getting done and/or the perception of his leadership of that deal. Whereas the banking VP touches a bigger variety and/or doesn’t feel his standing at the firm depends on how much he appears to be on the ball.
To be clear that’s just an illustration of what I mean by incentives, not saying that’s the setup. Just figuring there should be some rational explanation.
Very much agreed - I feel quite a bit the same...
My banking experience was good (no crazy bosses or hours), and I left banking as an associate before heading to PE; and my PE experience wasn't bad except for the fact that I had to switch firms due to a rigid MBA requirement (which I didn't feel was additive to my resume/career) - that being said, I do feel that the work is indeed Banking 2.0, and I definitely see that my peers who remained in banking (who are now Directors or even MDs) managed to save up materially more $ than me,
I think PE is great if you joined the right firm at the right time (and your carry is real), but I like to frame it as a do you wanna hit $10m vs $100m question:
- If you just want to hit $10m, staying in banking (and surviving) is probably the fastest and clearest way to get there (but you won't ever hit $100m)
- If you want to buy a lottery ticket to hit $100m, then you go to PE, but if it doesn't materialize, banking is far better to hit $10m
Based on your post it sounds to me like your firm has a really poor culture. A lot of your issues aren't "normal" for what I've seen so far in the industry.
Haha yeah, I mean I’m definitely under no impression that it’s good culture. But at the same time, it’s not a firm that has ever come up with blaring red flags when you ask around in PE, among bankers, some online searches, etc. So I guess in a sense I’m trying to gauge what “normal” really is in the industry when I’ve certainly heard there’s worse out there. Certainly glad to hear you’re presumably having a much better experience.
Identical experience to my PE firm when I was associate. Much more buttoned up, intense, detailed, and you have to fit in a country club-like way to get treated close to an equal instead of the help
The country club comment hits close to home. I went to a southern state school and I’d say socially I usually do well in most environments. There’s nothing I throughly dislike about anyone I work with, but I just can’t really connect with anyone.
Wow this “country club” comment hit deep… so well said…
My guess is that all the people who are working so hard have huge amount of carry at stake. You, as a new joiner, do not have carry yet. In the future, when you get carry, you'll become the same as them
Haha — as a matter of more or less semantics I do, but your point is taken. Though to me that timeline (~4 years before awards become meaningful, 4 years to vest, potentially few more to realize your first exit while getting locked in deeper every year) looks like far more of a deterrent than a motivation to even get that far in the first place. More power to them.
Wow, felt like I was reading my own thoughts. This was a cathartic read as a second year buy side Associate. You’re not alone man..
Haha it was cathartic for me to write as well, always good to hear I’m not alone but sorry you’re going through it too. Godspeed
1.5 year into my association stint at a LMM firm and my experience has been exactly the same. Once I get my bonus, think I'm going to recruit to go back to banking. More money, less hours. Just trying to maximize my own ROI at this point
Great post and agree with most of what you wrote.
I also had a worse experience in PE than in banking for many of the reasons you articulated.
I think I had a better than average banking experience and a normal PE experience, and the result was pretty disillusioning.
I feel like reading my own thoughts - exactly what I’ve been telling my friends. I was at a mid-tier IB but had a good experience - hours were bad but the people were genuinely caring. I got great deal experiences and was well liked by the seniors. I am now at a MM fund and while life is ok, I feel much less optimistic about the prospect. In banking I had a lot of visibility for promotion (I was told by the seniors that I’m in the pipeline for VP when I was just an analyst) but at my current PE shop, I’m not even sure about promotion to senior associate let alone VP/principals. Nobody above VP leaves the firm (Im pretty sure some want to but they can’t find what they want) and spots are limited by fundraising. Cash comps are lower than banking across levels. Yes we all get carry (associates get a small amount) but a few years before it starts vesting and then a few years till fully vested - so to me the carry doesn’t mean anything when I apply my own discount rate. A principal told me once (when he was tipsy) that he’s been here for 5 years and have not seen a dime of carry.
I think work is still more interesting as I enjoy commercial diligence but most of the time it’s about tweaking the model to do whatever to get a 3x / 25% case and then dealing with portfolio issues later. What I’m not sure about is if it’s just a junior experience and if life feels very different once you become a senior that you will really feel you are driving things / building businesses / partnering with management. If any VP+ has thoughts to share I’d appreciate..
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I went through this exact same realization (can check my past posts for reference!) and unfortunately I think this is the norm for a lot of people. If you aren't driven by prestige, money, or a genuine true interest in investing, it's hard to find your PE job fulfilling.
After going through 2 years of BS in banking and convincing yourself PE will be better, finding out you have to have the same level of neuroticism to succeed is a tough reality. Plus, as you note, people care so much more in PE that there is no collective 'this sucks' attitude that breeds camaraderie. Everyone there has a ton of comp at stake or are locked into their carry path. In some ways, they've chosen PE as their life and molded everything else around that, whereas after banking I was ready to not be a 'job guy' anymore.
I was planning on leaving the industry after my associate stint since, despite good reviews, I shared the same attitude you did and felt it would eventually either mean I wouldn't care enough to make it as a VP / above or I'd burnout (likely sooner than the former). Ended up getting a job offer somewhere else and left during my second year. No one understood at the firm why I was leaving PE for a lower paying job in my dream industry with better WLB, but that made me more confident I was making the right choice.
TL;DR: people go into banking for a variety of reasons, but most people in PE are planning on being lifers, so it's hard to go through the motions and that causes people to burnout quite faster than IB
I really enjoyed skimming some of your post history, and actually some of your comments I realized I’ve previously upvoted.
Funny too that you went to sports corp dev. I’ve thought about that quite a lot (it’s as much of a “dream job” as there exists while still being relatable to my career), and if an opportunity like that opened up I think it would make the drastic pay cut much more palatable.
Glad to see it’s worked out for you — gives me hope for the light at the end of tunnel.
Also enjoy reading your posts rubiomn9!
Hope you do an AmA / Q&A one day. Your story does seem quite interesting and relatable to me (don't work in sports but I relate to your career choices).
(Answered)
Adding to the fire. I was an associate a few years ago and felt the exact same way. Unfortunate to hear things haven’t changed much. It’s worth mentioning that PE doesn’t scale with people - it scales with money. Whereas banking scales with people. In other words, there’s much fewer seats as you climb and therefore it’s much more competitive and cutthroat. Imo - banking isn’t much better in culture and, first principles, I wanted to enjoy living everyday instead of just “surviving for maximum ROI”. Left the industry and much happier, making much less ($500K now), and work 4-8 hours a day. Still learning and growing - albeit slower. But I’d be lying if I don’t sometimes wonder if I had “manned it out” and be making millions right now. But I’d rather have a fleeting thought than hating every minute of my life
really curious on what did you do afterwards. feeling the same way and looking forward to find a way out direly..
OP - you are absolutely not alone in your thinking or experience. As others have said, this reads to me as my own personal thoughts and experiences.
I have few years of buyside investing experience (2yrs MM private credit + 2yrs LMM private equity) and started in banking. I started my PE gig after my PC days, and was in a similar boat to you. Pretty well-liked when I left PC, and had an opportunity to stay on long-term and really liked the team. But I wanted to try something new and build my equity chops. I knew I'd be at the bottom of the totem pole and have to grind it out, but didn't realize how oddly intense / stuffy the culture would be. Not in a healthy competitive way, but in a "I could never envision myself becoming my MD / principal / VP" way. I resonate with everything you said above to the tee.
I've since left after finishing my PE gig, and moved into a different investing role. It's amazing to me how reinvigorated and rejuvenated I feel when working nowadays. I don't regret my PE days, and understand why I had to go through that grind. But understand that things do get better afterwards, if you truly think about what you want to do with your time and effort, and find something that aligns.
So happy that you have found what rejuvenate and energize you!! Could you mind me asking which industry/role are you taking after this? because at this point, I'm just not sure what are the options anymore...Thank you for the insight
Now at sovereign wealth fund focused on direct PE / VC investments with an impact investing focus. Less $ in total, but definitely more on an hourly basis.
A little over a year into my PE stint, and the senior associates/VP's grind more than I do... struggle to see myself in their shoes post my associate years, this thread resonates with me big time and is refreshing to hear that this seems to be more the norm than I expected. Planning to stick out at least 2 years as the experience will definitely pay off, but beyond that it's pretty hard for me to commit to.
It’s been great to see all the responses and it’s almost surprising given it’s not a super common discussion. I know many people like myself who left to PE for mistaken reasons, and it would benefit both candidates and firms alike to set the record straight. I’m sure some better self-selection and confirmation bias helps. But also I think some of us are afraid to admit that the perceived endgame isn’t so endgame (sunk costs, etc.)
Largely agree with the sentiments expressed here and I think the issue people have (or at least I have) going into this job was that it was a step up and endgame from IB in terms of thoughtfulness of work, comp, responsibilities and skills developed, better WLB (at least marginally), etc. For me anyway, it’s generally been the opposite - pay cut in compensation, worse hours on leaner teams, and generally similar amounts of mind numbing work at banking. It is more critical work generally but instead of building a CIM I’m managing other admin tasks for my portcos or formatting market maps, etc.
What disillusioned me is seeing how you have to grind even as a mid level and your stress doesn’t go away or magically get fixed, it gets even worse as your rep is based on the deals you close or don’t pursue. Partners may have more free time but they’re still always on calls, managing portcos, etc.
If you love all that and love the job itself then its a great gig and I don’t want to come off entirely negative as you develop a strong skill set and get to interact with high level executives as a junior. That being said, in order for the math to work out for carry you have to work your way up in often political and poor culture environments, and then stay at a firm long enough to realize that carry (multiple years). If you’re driven by money or love the job, then the cost is worth but if it’s neither like it is for me, makes it easier to walk away.
Very much agree on mind numbing shit. Tbh I may spend more time formatting stuff now than I did in banking.
All absolutely hilarious because 98% of it is strictly internal unless it’s a specific PortCo task or lender stuff. I understand for IC and high stakes deliverables. But I was mindblown the first time I was told “partner wants to see this quick analysis on customers” and it required like 3 turns of formatting nits (number formatting & dollar signs, summation lines vs an indent, adding a line between columns, etc.) I remember in banking even if it was my director, I could just send a raw data Excel or screen grab for something so elementary.
Your last line also resonated. To an extent I’m grateful because prior to PE, I might’ve been one of those who wrongfully stuck around whether it was due to comp or prestige or just inertia. Seeing the reality of this side, at least I’ll feel absolutely confident in my decision to leave.
Anyone have a perspective that it’s in fact not worse? Little disheartening to hear as a second year analyst…
These points resonate with me, but it feels a bit glass half empty and one-sided. I feel the job is much more rewarding given the increased responsibility (at least at my firm) relative to banking. I certainly have my own frustrations that pertain specifically to my firm, but that will be the case anywhere. At the end of the day, you have to really enjoy the work and the job and see the bigger picture. I didn't have a good idea of what I was getting myself into when I joined, and after a year or so getting the full picture, there are puts and takes. Just like with any career choice, it comes with a set of problems. Whether or not you enjoy solving the set of problems that comes along with a job in PE will determine your attitude towards the job.
FWIW, I agree with you. If I loved the job and some of those elements you mentioned, I imagine I'd see the balance too. There's certainly a spectrum, and I happen to be on one end of it.
Original commenter - I definitely never meant this post to be any sort of guide to anyone making a decision or anything. To be clear, I posted mainly because the vast majority of people I know (and certainly on the internet) would agree with picking PE life over IB if asked in a binary question. So I see this and a lot of the responses as a devil's advocate response to a somewhat more "mainstream" opinion.
A lot of my friends joined PE and prefer their current situation over banking. From my view - some are genuinely in great positions and may be in it for the long haul, and some are getting by decently enough to stick around a few years (but don't see a long-term future). There may be some inertia and confirmation bias involved, but I'm actually the only one I know who would say I regret making the jump. So definitely don't think this itself should cause any panic just yet.
That said, not to go all psychologist here, but if you have second thoughts as-is, maybe the real root of those (not so sure about investing, banking job is pretty cushy, only doing PE because everyone is) should be considered. Those can definitely make the flaws of the job more pronounced.
Interested to hear what you or other more experienced guys here mean by this. I'm currently at a MM infra fund, 50-60 hours a week so far which tbh is better than I expected, but I'm conscious of the fact that it may just be because the fund has only just begun deploying.
Does infra fund also do the portco management work similar to traditional buyouts? Like value creation stuff (I guess M&A etc?)
Well tbh that's kinda why I was asking, to see other people's take since most of the IB/PE people I know from uni/in-person are not in infra.
But well most of the deals we've been looking at are platform deals and infra-as-a-service kind of stuff as opposed to individual assets, so I think so, yeah. For at least one of the platforms we're looking at, synergistic bolt-on acquisitions look to be a big part of growth projections.
It's called variability in different teams. You can just be really unlucky after checking for things like what's the senior-junior ratio (the bottleneck is always the senior in PE) before joning.
You need to set boundaries at some point to survive. If you get pushback, it could be that your staffer thinks you're taking way too long, or they're actually unreasonable. You can also set boundaries by pushing back on unnecessarily complicated work or people trying to do next month's work today and that sort of thing.
Try to benchmark and then read the room to find out what your options are. Are you valued enough that they'll cut you some slack? It sounds like your shop is severely understaffed.
For sure. The post was just somewhat of a gauge as to just how “unlucky” or uncommon my personal experience is (a little masochistic, a little intellectually curious).
I fully agree on pushing back, it’s great advice for anyone here who hasn’t. Unfortunately I can’t say that’s my issue. For what it’s worth, we have no staffer or oversight to how junior resources are managed (cue the time that I told a deal team I didn’t have capacity for a new project and they basically told me that yes I did). The other big issue with boundaries is that most things are flowing through my senior associates, who all categorically refuse to push back on literally anything (I “get it” given SrAso->VP is the main hurdle for promotion here). The most “give” I’ve ever gotten from a SrAso on a completely unreasonable request from VP is “I’m so mad, I’m going to put that in his annual review.”
In any case, I’m sort of ranting now — tbh it doesn’t really matter who’s “to blame” at this point. My future is already written regardless of the why’s. Very admittedly just seeking some sort of validation or commiseration along the way in case it’s a more common experience than I expected. And if not, oh well I guess I’m due for some bad luck in my life that’s been fairly privileged thus far. Cheers.
I hated PE so much that I resigned with nothing lined up.
What aspects of the job (or if it pertained to your shop) made you make this decision?
Same here. And have a friend who did as well.
Do you know what you want to do next?
Also, from what I've observed, folks who enjoy their PE associate experiences relative to IB all had trash IB experiences. They needed it to be that bad (from a starting point) to enjoy PE.
If you had a mildly good (or above) banking experience, chances are PE will feel like a downgrade.
I made a similar post addressing PE issues recently. See my post here https://www.wallstreetoasis.com/comment/3154943#comment-3154943 (also pasted below). In my experience, your sentiments hit home for the majority of ppl who go the PE route.
PE as a longer-term career is vastly overrated and not a good decision for the long-haul, which shocks many. I do think there is merit in associate years because the learning vs. banking is significant and opens up a lot of doors. The problem is a lot of undergrads and bankers have been gaslighted into thinking that PE is the long-term career path way to go. The following are just a subset of issues that are not discussed often enough about PE:
1) The big $ in PE that pays off vs. other finance paths will not be made unless you stay with a fund for >10 years. This is the case at >90% of funds. IMPORTANT: this requires you find a fund that is tolerable and that you can reasonable stay at for that duration plus one that you play the corporate politics well-enough for the more senior seats. Hint - this is extremely hard to find.
2) The work is mind-numbing after you do your first couple of deals. Once you learn the game, combing the data room and modeling out false precision becomes unbearable. Most folks cannot say they enjoy sourcing with a straight face and view it as a necessary evil.
3) PE is banking 2.0 narrative is absolutely correct. You are trying to do deals and accumulate AUM. Firms will claim they are not and that "trying to stay small" but they are trying to do as many deals that their LPs will allow within their strategy, regardless of forward returns. Don't be fooled. If you want to do investing, go to public markets.
4) It's incredibly hard ex ante to pick which firm you want to be at since you're dealing with very smart folks who all know the right things to say. Weight that against the fact it's hard to get more than 1 solid PE offer and you're left making a less than ideal choice if you want to do PE. Try to speak with former associates/VPs if possible, they are likely the only ppl who will give you a straight answer.
5) Last, reverting to my point #1, if you want this path to make sense, you have to suck it up and deal with all this BS for ten years at the same fund without going crazy and ruining your personal life, knowing that if you decide to leave, it's a negative NPV decision due to the way the carry vesting works.
In summary, the narrative around PE needs to change. This is a mature industry where it's incredibly hard to get 1) a seat at a good fund and 2) a seat that you have staying power at that makes the sacrifices worth it.
Great post, and also fully agree with anything I haven't already echoed.
I personally struggled with point 4 a lot. I have always been a decently cynical person and consider myself a decent judge of character with pretty solid "bullshit meter." While recruiting, I really did as much due diligence as I could via bankers, third parties, friends at other firms, people who knew people, and every online source I could find. I spent a few months feeling genuinely upset I had been played, questioning my own judgment, confused at the fact that everyone sold me so damn hard.
I eventually did come to terms with it all. I think ultimately in an investment team of ~30 people, ~10 of them truly like it ("investor" types), ~10 of them are deluding themselves while continuing to chase promotion, and ~10 of them just have to consciously lie because the team is small enough to trace back any bad word. It's a well-guarded setup, and pretty hard to break through unless you're lucky to be dealing with a firm where you have a source. But of course, with on-cycle recruiting you just take whatever offer you get. It's not easy, and the system does set you up to fail.
Definitely ask former employees if you have access to them. I actually started looking up former employees on LinkedIn 6 months into the job, and I regret not doing so much earlier.
Agreed - point #4 is the most painful. In banking, there's very much a "going in with eyes wide open" mindset where you know what you are getting into. Some PE firms legitimately gaslight recruits as a strategy to get ppl to take the offer because guess what, 99% of PE firms don't have name-brand recognition and ppl want to buy-in to life being better on the other side of banking.
It's a nasty game but I agree at PE firms incentives are too great to deviate from the firm message. I joke that it is a cult, but it really is. If you dissent or cross someone senior, you could fck up your trajectory at the firm over something petty. Even some FORMER employees don't say it straight since they might have co-invest yet to be vested and the investment world is a very small place.
The PE career path attracts the most risk-averse ppl in the investment landscape. Ask yourself, do they have the balls to tell you straight?
Don't be too hard on yourself. At firm I did associate years, we all felt slighted and pissed off. It happens.
1000% resonate with this. Constantly feel like I'm being set up for failure but I'd say the experience varies/comes down to luck especially during on cycle where you probably don't have time to diligence. Some of my buddies have Sr. Associates/VPs willing to help them ramp. In my case, I'm lucky if I get a response to questions over ping and emails.
If you are getting caught up on convoluted sumifs until 2am, then you may consider changing jobs
Oh that’s already been decided. This is just some bring down diligence to find out who else is going through this lol.
Are you think another PE gig or something different?
This thread is interesting, and I think a lot of it comes down to luck and also perhaps a lack of perspective/maturity. As someone who is a bit older (but still in a mid-level position due to some questionable early career moves), I think eventually you will understand that ultimately ALL jobs suck in some way.
It sounds like OP had a dreamy banking experience - my banking experience, perhaps because I did my stint a while ago now, was categorically completely and utterly miserable and the worst years of my life. I worked at BBs and boutiques - all the same. I gained weight, lost hair, had personal relationships suffer etc. The completely asinine attention to detail, sociopathic and stupid seniors (I had a VP at GS/MS/JPM who did not know how to compute a CAGR lol), endless fire drills for work that ends up in the trash, I could go on and on. Yes, there is obviously some gallows humour and camaraderie when you are all getting equally fisted, but I really could not give a shit about the rest of my class and would much rather have just gone home before 2am every day.
Not every PE fund is banking 2.0. Yes, obviously you will be doing a lot of the same work and blah blah, but ultimately - the intensity that OP highlights is what makes it interesting. You have actual skin in the game and SHOULD care about how your investments do; if you don't, then it obviously isn't the right career for you. I get that its hard to see the bigger picture when you're constantly up against it as an associate, but there are plenty of funds across the spectrum that have good and respectful cultures that will allow you to think a bit more strategically and actually care about your work. In banking, I didn't give a single shit about ANY of my output besides it being error-free so I did not get shafted; that lack of interest actually made it so much harder to do a good job.
PE definitely has its downsides and its important to be cognizant of those when coming in. I think it is also a U.S. thing - the 2 and out culture and INSANE recruiting timelines don't really exist outside of the U.S, which I think has a negative impact on the culture and causes associates to just be expendable resources. But as many have said - you're locked into a carry path, cash comp is a bit lower than banking, etc. etc. It is certainly not the "promised land", just another job in finance that suits some more than others.
Ultimately I chose to stay in PE because I could not think of any other role that was fairly interesting and paid good cash comp with considerable upside potential. I'm happy with my choice. You have to find what works for you - might not even be in finance.
The points you make are all fair and apologies if it feels like I didn’t acknowledge enough that PE is great for some people. I get it, it is. Not only for random people on the internet but also for a lot of my own close personal friends, both at the associate level and higher up. To me, that’s by far the dominant opinion I’ve been hearing and almost didn’t need to be said. That’s also why it was somewhat important / interesting to see if anyone resonated with the other side. (Tbh this post was nothing but a sad pity party, and I never expected it to draw attention from anyone else.)
I will also note that my banking experience wasn’t “dreamy” by any means. If it were, I would have stayed — or gone back by now already. To your same point about PE, there’s a wide spectrum. It wasn’t incredible, I experienced some of the same frustrations you did, but there were enough elements about it that made it tolerable, same for you with PE. Anecdotally, I spent the last 6 months of my life pushing through a deal that literally no one thought was a good idea besides the one partner, which was more frustrating than any useless fire drill bake-off I got thrown on in banking. You’ve basically written out my experience to a tee, except completely in vice versa. It happens — and yes, I’ve believed for a long time that all jobs suck — but this one sucked for me much more than the other one. And if I have to stick it out 5+ more years or 2 more funds to appreciate the perspective, well unfortunately I just can’t make it that far at this point.
Happy for you though, I’m glad you found a place that you find fulfilling and that respects you. Obviously that’s the dream, and it’s stories like yours that motivated me to give it a shot in the first place. Best of luck as you continue your progression up.
Thank you, and I completely understand. I hope you find something that works best for you, and don’t be discouraged - sometimes it takes a while. All the best!
Honestly, all I'm seeing is another data point following the rule (derived from anecdotal observation) that I pointed out earlier:
- If you had a truly miserable, horrendous time in banking, PE might be okay
- If you had an okay or better banking experience, PE will probably suck
Correct, and as OP said, it's certainly more the norm for banking to suck and PE to be at least marginally better.
I think there are two related but distinct points on this topic and your response jumbles them together. 1) is PE worse than IB analyst? 2) is PE career path worse than IB or comparable front-office finance jobs?
#1 I think there's a consensus that IB analyst is in fact worse than PE at face value, although I'm sure there are one-off cases. IB analyst is pretty brutal and you address this in your reply.
#2 is where I think there's a big misconception and what I think is the more interesting topic. I don't want to speak for OP but I think a big part of the sentiment is due to being duped into thinking of PE as the long-term career track and when you find out it's not, the path forward becomes a lot foggier (and makes PE associates yrs a b*tch to get through). Not that the PE associate work is necessarily worse at face value relative to IB.
PE as career track is a different question and think there are very strong arguments why it does not make sense for most ppl at most shops (i'm sure there are some where it does make sense). This is where there's an inefficiency in the market and how ppl think about PE in 2023. From my cohort, almost all ppl going into IB knew they were not staying. For many going into PE (particularly if shops were career track), a lot thought it was high chance PE was where they wanted to make their career and now most do not want to stay there. A lot of points addressed on why above. At the end of the day, you are right that most jobs have aspects that suck - but I think the brutal truth of PE is that a LOT of the job sucks until you make partner and you won't be properly compensated relative to other finance careers until you are partner/near-partner (i know there are exceptions).
No one answer fits all. Just strongly believe #2 on PE as a career is widely misunderstood. This isn't the 80s or 90s where PE was a burgeoning new industry. There are a lot of top-down industry dynamics at play and you have to commit to paying the piper for a long time to reap meaningful rewards, and it's near impossible to know which piper (firm) to trust.
Just one anecdote from someone in my network: 10-11 years out of undergrad. Worked in IB/consulting for a 3-4 years and then went to a PE career track place in MM/LMM (no business school). Works like a dog at this firm. Firm is ~median/slightly below on cash comp relative to market. He wasn't able to take advantage of the low mortgage rates to buy a home since too much of the comp is deferred to carry, and he's not 100% sure if there's space at the top for enough partners in ~4-5 yrs when it could hypothetically be his turn. Just a very tough place and it's not an uncommon circumstance if live somewhere with higher cost of living.
And not meant to be a woe is me - obviously if you are in this scenario, you are in the top 0.1% of the world, but for folks on here who want to a) have a somewhat interesting job b) get paid c) have visibility to upward career path, it's a tough cookie to swallow.
Fair enough. Fully agree that things become way less certain when you go to PE / buyside in general. Even with hedge funds, many in my network bounced around between funds for years until they either did something completely different or found a shop where they could finally grow upwards. I'm talking people with the WSO wet dream pedigree - i.e. GS/MS, megafund PE, HBS, top hedge funds - even they experienced many of the same issues you described re. top down dynamics and industry headwinds. Happens everywhere.
Part of my philosophy in life is to have low expectations, which is why I was pleasantly surprised by PE. If others went in expecting nirvana, I completely understand why they would be disappointed. Misaligned expectations are a key reason for unhappiness.
We can debate the fundamentals of whether it is a good career in the current age ad nauseum, but like I said, it's all down to personal preference and ultimately every data point is just somebody's individual experience.. The deferred comp structure is a huge pain for sure, and what happened to the guy in your network is a common outcome. I hope he can either lateral or a partner spot opens up for him in his firm - I'm sure it will. However, you would have to drag me kicking and screaming back to the sell side, purely because I now have way more control and visibility over my time, where friends in banking even at ED level continue to get crushed over asinine requests. Again, all anecdotal and YMMV.
Lastly, you're absolutely right on how hard it is to back the right horse. It's not always the best thing to join the latest enormous corporate buyout fund at KKR, and that can be a frustrating realization.
While mixed together, yes, I think for the purposes of my post, I was more focused on the #1 consensus being untrue in my case (and seemingly not as rare as people make that out to be). And then #2 not providing much light at the end of the tunnel.
Bump
I left PE earlier this year and your post is relatable. The work was generally fine and my hours were fine, but the culture and energy was awful. I got dragged over the coals during my time in banking but I made some of my best friends and still talk to various of my coworkers. I appreciate that that isn't a 'normal' job experience, but at my PE firm the culture hovered between bad and non-existent (and I took a pay cut). A few friends from banking left PE for similar reasons — one of them went back to banking after a year.
Everyone Sr. Assc and up sat in their offices and the associates were in the open area. We all (associates, office services, IT, the comms team, etc.) generally wore headphones and it wasn't abnormal to message people who were 15 feet away from you instead of walking over to them. I think in my 2 years me and the other associates got drinks after work 2x. Our holiday party was a 2-hour luncheon. Pretty much any chit chat during meetings was about a) work, b) sports, c) someone’s children, or d) someone’s children’s sports (my co-workers in banking also all had kids).
Agreed on the intensity. Everyone else was super bought in — for obvious reasons ($) — and it felt like I cared about my /job/ and they genuinely cared about what the issue at hand was. I don’t think we ever commiserated like “this sucks!” If you joked around on Teams it would normally be left on read. Basically, it was an intense job with no connection to your coworkers. Most of my coworkers had also been working together for a very long time (it was a small team) so I felt like I was sort of on the outskirts.
Professional development was also pretty bad imo. It was rarely explained clearly what was expected of me (at my level, not specific tasks I mean) and feedback was hard to come by. In banking we got a ton of feedback, expectations were clearly set and it felt like people genuinely wanted you to grow. When I was in PE my VP borderline refused to give feedback then dumped it all in your review. It felt more like you were supposed to just know what you needed to be doing to step up without any input.
I work on a Corp Dev team now and my team + the firm I work at both have a good culture. When I’m in the office there are people sitting around and talking, I’ve been out to drinks with co-workers several times, they have interesting events and stuff. Obviously didn’t expect all of that in PE, but it’s made me realize I missed camaraderie. It’s a lot of small stuff. During calls me and my Sr. Manager message each other on Teams cracking jokes. One of my directors was telling everyone about the Taylor Swift concert she went to on our team meeting, and when I started they asked me to un-blur my background so they could see my dogs.
This was a long rant, but I guess the takeaway is PE can be a very good job and there are probably some firms with awesome culture out there, but by and large it’s a much more staid environment and having ‘fun’ at work is less common.
Funny you say all this because my PE firm actually tries very hard to have a culture, but I think I just see through the fake surface level BS of it. We had a bunch of social events that were just 90% drinking and then still talking about your job, sports, or families to your point. There were people joking around on Teams but to a really cringe extent where they were forcing it. I really feel like sometimes I’m the only human among a bunch of robots programmed on how to have social interactions.
I think this is pretty common in PE. A lot of surface-level talk of "culture and family" but in reality it's a façade for being able to push people to their limit and abuse positions of power within the hierarchy.
The reality is many PE firms think that for the firm to function properly, you need absolute loyalty - you can't have junior and mid-level people complaining or raising issues about the pyramid of compensation and hours worked (even if warranted). You need complete buy-in that the dream of starting as a junior/mid-level and rising to partner is both within reach and a desirable outcome. This is because of all the deferred compensation. If people start to question whether or not there's a payday or light at the end of the tunnel, you will see tremendous churn and your recruiting pipeline will be destroyed.
You also have mid-level people who are very sensitive to these issues because they have "made their bed" so to speak. They gave up a lot of cash compensation to stay in PE (and probably worse off relative to peers who stayed in IB for longer or went to HF) so they are completely bought in and need things to work out at that firm where they have their carry. Once you commit yourself to making meaningful carry at a PE firm (VP and above at most firms), you've put in a sh*t ton of hrs at that firm and leaving becomes incredibly negative NPV.
Some smaller firms (less name-brand prestige) are pretty cultish because of this and it's disgusting once you notice it. I know one firm in particular who seems to look for junior hires that will be less susceptible to raising issues and instead "sucking it up" despite awful WLB and compensation.
Fully agree with this. Have found PE to be much worse than IB and contemplating moving back to the sell-side. Buy-side pay isn’t much better, and the culture/WLB is much worse.
Did you have a generally good time in IB and went to a sweatshop for PE? Would you consider moving to another buyside role?
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