Pros and Cons of AQ/AM vs separate functions

It's typically more a function of the size of an institution than it is a strategic decision.

If you have the money to pay for a full asset management team, that's going to be preferable as those employees can be true experts on the subject while hybrid acquisition/AM guys have to split their duties. This is why, as you pointed out, larger shops tend to have two separate teams.

That being said, I'm firmly of the opinion that there's a huge advantage to taking a hybrid role at a smaller shop earlier in your career if you have entrepreneurial aspirations because you get a more holistic skill set.

Cons of them being together is honesty work load. I’ve worked at firms where I’m silo’d and firms where I’ve done both. The problem when it’s combined comes into play if your bosses don’t respect the fact that there are only so many hours in a day. If acquisitions are heating up and your grinding to close a deal (or even just have large deal flow and need to sort and underwrite a few new deals per week) you’re gonna only have so much time. It turns into a vicious cycle of deals by day and asset management by night. If you’re in a firm with a good culture they won’t push you to the limit. But some people won’t care and you’ll just be working around the clock. Personally, I prefer silo even though it’s not as good for learning. It just lets me focus and do my job without having to do 2 jobs in one. I already work 50 plus hours per week and pretty much every weekend. 
 

Many funds who do a hybrid role are shaving costs. At the institutional level, if you are an operator, it’s really hard to charge deal by deal asset management fees. So it makes it difficult to higher additional people for asset management because you don’t have the budget. Due to that, you combine. Other funds, usually smaller funds, just don’t have the fee income to separate. So they keep it the same and just grind people = higher turnover. Because it allows them to shave compensation by not having a larger junior team to do the work. 
while not always, it generally is a budget conversation. Most senior people get their juniors will leave the firm. So they don’t care if they grind them for two-four years because they will leave anyway. Might as well squeeze as much juice as you can. 

Some funds don’t want to admit that they’re big enough to start silo-ing because it’s so expensive to build out a separate AM department. And as long as there are enough junior people who are willing to grind it out, they’re not incentivized to make that change.

My argument for separate AM teams is that it’s such a different beast from acq. And it’s also where the business plan gets proven out/executed. That kind of work deserves dedicated professionals. 

I was in a hybrid role for one of the funds mentioned in this thread, and a big reason why I left was bc I was essentially working two full-time jobs. When I (respectfully) complained to management, they said it makes me a better investor. Not wrong, but if I’m supposed to spend an extra 30-40 hours per week on top of my normal acq job, I’d rather it be related to sourcing deals/business development. If I wanted to be in AM, I’d already be in AM.