Ares Capital Management - Culture, Status, Word on the Street
Hello everyone,
Does anyone have anything to share about these guys?
Hello everyone,
Does anyone have anything to share about these guys?
+42 | Compiled Bondarb's Comment History | 9 | 2h | |
+37 | T2 Hedge fund or T1 LO/AM? | 13 | 13h | |
+31 | Non-GAAP Income Statement | 6 | 2d | |
+23 | How do you get up to speed as a consultant on finance? | 5 | 1h | |
+22 | Thoughts on MMF | 17 | 6h | |
+21 | MLP portfolio manager guaranteed payouts? | 19 | 6h | |
+20 | Top LO AM culture, comp, exit opps, etc. | 4 | 3d | |
+18 | How to Structure Bonus Comp for Analyst | 5 | 1d | |
Joining buy-side directly at boutique AM or ER at BB for HF future? | 9 | 6d | ||
+16 | Cost of leverage at MM funds / pod shops? | 14 | 11h |
Career Resources
Seem to have put together a decent team. I have a friend that worked @ Jeffries that moved there and likes it.
I'm still skeptical since they were the former Allied Capital.
Are you kidding me dude? This is a great, great fund. Best debt funds out there.
Deal with these guys all the time on deals.
solid debt team. don't know anything about their pe arm but assume it's good as well.
Thanks for the feedback guys, I appreciate it.
I rejected these boys (i'm not here to offer much, i just don't get opportunities to reject mega funds that often and want to gloat slightly).
This must mean you got one of the other offers you were gunning for!
Multiple investing strategies, so have to specify what you're talking about:
I'm definitely interested in learning more about their private debt group in comparison to similar functions at oaktree, kayne anderson, and bain capital. If you have any info, it would be much appreciated.
I know their PE group just started its own analyst program, recruiting right out of undergrad. Heard it's rather a good place to work.
The private debt group is synonymous with other BDCs (think ACAS, Prospect Street Capital). Kayne is a fair comparison. I would say Ares sees better deal flow than most BDCs.
Hmmm, does being a BDC make it a less attractive place to work in terms of culture, pay, and career advancement? Pardon my lack of knowledge....
Depends what you are comparing it to. Turnover is high at the lower levels (analysts, associates), not sure about mid or upper. I know a few guys from boutique DCM desks that ended up there (think Jefferies, Piper), but they left within two years.
I imagine pay is above average against other BDCs and MM lenders, but cannot confirm.
It's a tough interview process, I was very surprised at each stage i got through.
Yea, i got all three positions (yup, me gloating again) i went for, and went for potentially the least prestigious but what i believe to be the best learning opportunity.
Ares Management was originally started as Apollo's debt arm and they share a lot of cultural traits with Apollo from what I've seen/heard.
They're a player in PE and RE, but a lot of their AUM is in their BDC and CLOs. The BDC, as mentioned is the former Allied Capital (same CFO fwiw). The BDC/Mezz, CLO/public debt, and PE teams are separate at least according to their website-in my experience managers like this tend to have some amount of cooperation to the extent they can without causing conflicts between various vehicles.
Only clarification I'd make is that the BDC and CLOs are merely vehicles. The investment professionals are not spending the majority of their time running analysis on how much to dividend to the public BDC investors / pooling together loans and passing them along to various investors.
http://aresmgmt.com/Public/About/History.aspx maybe helps tell the story a little more clearly (in terms of funds committed by strategy over time).
The Apollo debt arm from which the firm was formed stands today as the Capital Markets group (like any hedge fund there are several funds managed out of this group; some comprise lower-risk syndicated leveraged loans [and use financial leverage to boost returns], while others invest more in HY bonds [less financial leverage] and distressed securities [almost no financial leverage]). Investment professionals here are classfied like they are at any other hedge fund (just Analysts/Sr. Analysts and PMs) and are responsible for identifying the right investments across these three groups (loans, bonds, distressed) and monitoring them. More time is obviously spent on diligence, etc. on the riskier end of that scale (bonds/distressed) because BB-rated loans aren't going to be worth 0 tomorrow. Lifestyle - generally market hours (so you get in between 7-8 AM as everyone's in LA). Can be stressful during those hours but you're out by 5-6.
The BDC is just one of the vehicles of the Private Debt group. Investment professionals are spending time looking at CIMs, doing diligence, putting together term sheets, going to investment committee and then finally investing. Deal timelines are typically ~14 weeks. Sr. guys (classified more like banking/PE as MDs, etc.) are sourcing investment opportunities through relationships w/ PE firms while jr. guys (classified more like banking/PE as well with Associates, Sr. Associates, VPs, etc.) are managing the diligence processes. Lifestyle - chill/good hours. Little busy when you're going to investment committee or if you have a couple of things going on, but keep in mind this group has the highest amount of investment professionals to funds managed ratio (this is positive/negative in that it benefits lifestyle/hurts the prestige factor of a jr. level position).
PE is what it is, although as I think I mentioned there's not a whole lot of vanilla PE. Group is pretty indifferent between majority/minority investments (vs. the more standard majority-only deals you see with PE firms of similar size) and will play the majority angle pretty selectively in what I'd classify as more growth-y plays. There's an equal emphasis put on rescue lending / distressed for control, which I think also distinguishes the group. Lifestyle - not good. Banking-type hours in that you're eating dinner in the office nightly and are always on call. There's less old-Apollo here vs. Capital Markets but it obv. has its own prestige factor because it's PE.
What the groups share:
You're not talking to counterparts in the other groups every day, but folks will use each other for help when needed. As a result of the second point, though, there's a good degree of mobility between the groups to the extent you want to try something new.
Wow, this is really great info. Thanks for the insight. Do you know how the Ares capital markets and private debt team compares to other funds that have similar functions (Farrallon, Oaktree, Bain Capital - Sankaty, Kayne Anderson, Golden Tree) in terms of career advancement, compensation, and experience?
I'm really interested in the space, but it's hard to find concrete opinions on the matter. Thanks in advance.
If you're looking for a combo of career advancement, comp. and experience, I'd rate the firms you listed as follows:
Oaktree Distressed (good for all three, but the risk/return spectrum on distressed stuff is tightening; there's just not a lot of distressed paper out there... really the only bad thing you can say about the firm)
Farallon (good for all three, but credit/distressed business is smaller/has not performed as well as Oaktree/Ares/top hedge funds - if that sort of thing matters to you; highest pay/prestige factor of anything you mentioned)
3.a. Ares Private Equity (good for all three, but vanilla PE in general is on the decline and as mentioned w/ Oaktree you have to pay more to get your hands on the distressed for control stuff these days; as mentioned lifestyle is like banking) 3.b. Ares Capital Markets (comp. slightly below the others and likely not considered as prestigious as Oaktree/Farallon [to be frank this is like comparing Ivy League schools], but has performed well and has a lifestyle benefit over 3.a.) 3.c. Sankaty (v. solid place w/ a smaller distressed focus but a slightly more cerebral/distinguished approach [note how MDs and up are listed on the team page vs. 2., 3.a. and 3.b.]; slightly better comp. than Ares Capital Markets but similar $/hr.) 3.d. Oaktree Corp. Debt (Oaktree as a firm is a great combo of everything, but you're getting similar pay to 3.b. and passing along distressed/special situation stuff to the A-team)
4.a. Ares Private Debt (sheer # of people is why I'd rate this here) 4.b. Kayne Anderson (rep. is decent; OK pay... it's just that there's a difference between where people from the first three groups end up and where people from Kayne end up - to the extent they leave) 4.c. GoldenTree (rep. is more mutual fund than hedge fund; OK pay)
Thank you so much, this is a great info. Just for clarification, is Ares Capital Markets a hedge fund? Or is it a fund that uses hedge fund strategies for credit investment? Also, can you share some additional info on Ares Capital Markets in terms of analyst exit opportunities, promotion/advancement to senior analyst and bonus relative to PE and Private Debt Group?
you are crushing this thread; well done
Can anyone speak to the kind of returns that private debt arms can get?
Think about the cost of capital. It depends what type of blend they get across senior, sub, mezz. Generally these groups won't focus on senior, unless they tie it to sub (i.e. unitranche).
Unitranche looks for 10-15% (depending on borrower's quality, collateral, willingness of debt group to put capital to work, etc.).
Sub/mezz is going to be coupon between 12-16%. If warrants are attached, it will approach 20% or cross into the low 20s).
Each shop is unique and changes as its capital availability fluctuates.
Broadly agree though I think there's a decent BDC-based bid for 1st lien mid-mkt paper well inside of 10% right now.
Ares BDC is a public filer so you can see what they've been up to. There may be some deals that go into other pools of capital but it should be a pretty good cross-section of the private debt side of things.
Did they take another tranche too? Generally I find BDC pricing is unreasonable for 1st lien loans and are seldom winners in a financing process unless there are some issues (i.e. balance sheet problems, illiquid collateral, restructuring, high custy concentration).
Ares has a lot of balance sheet CLOs; post-crisis all the new non-listed BDCs are using TRS lines to play in the squishier portion of the broadly-syndicated/upper-mid-mkt space.
Ares also has a grandfathered-in leverage line from GE that doesn't count against their 40-Act leverage tests so they have more flexibility than many BDCs; additionally the loans they put in this vehicle don't get consolidated into their financials so they don't show up when you're eyeballing their portfolio.
+1
As a junior analyst in the Capital Markets group, what can you reasonably expect in total compensations? Also, how long does it typically take to become a senior analyst? Is this role the same as a credit research analyst at a traditional asset management firm such as PIMCO?
No. PIMCO is investing in fixed income products. Ares is a direct lender to middle market companies. Ares is more like a bank than an asset manager.
That's completely false - this would be true for Ares' private debt business, not capital markets as the question asked for.
Some of the stuff Pimco does overlaps with Ares CM, some doesn't and vice versa. Ares doesn't do investment grade or have an equivalent to the strategy Pimco's most well known for, though (Pimco Total Return Fund and its derivatives).
Thanks for the reply Frank. What is total comp like for junior analysts? When I visited their website and read bios of their analysts, some have been with Ares for 5+ plus years. Does that mean promotion to senior analyst will take 5+ yeard?
You are right. Didn't even know they had a CM group. Only deal with the private debt side.
Ares e-mail format (Originally Posted: 04/28/2009)
Hi everyone,
I was hoping someone could let me know what the e-mail format for Ares capital is?
Thanks a lot
-Jimbo777
first initial and last [email protected]
ex [email protected]
Hope this helps.
[email protected] .....hope this works out
.
Ares Management - Info on comp? (Originally Posted: 06/25/2010)
I know that the fund broke off from Apollo, and that they manage a lot of money.
Does anyone have info on comp, etc for them?
a million gabillion dollars.
varies..but $120K base was standard in 2007
Thanks for the info Cornelius. Have you heard good/bad things about the firm?
Ares Management - Mostly MM stuff? (Originally Posted: 09/02/2011)
My impression was that these guys are a HY shop a la Oaktree. Dabble in equity a bit but it's mostly MM stuff. Anyone have any thoughts?
not sure what i can add, i do know they do a lot of different things and are in MM (although that means different things to different people) i assume these guys are hiring?
What kind of thoughts are you looking for?
They have distinct funds for debt/mezz, real estate and equity, and one of their funds is a BDC (publicly traded-"ARCC"). I interviewed there a while back and have dealt with them as a potential financing source on PE deals. Culture is rough--typical DLJ/LA-esque ex-banker mentality, or at least that was my impression from a handful of interviews like 5 years ago. I could be wrong and/or it could have changed since.
Thanks, apareto
I meant mostly in terms of hours, compensation, culture, investment philosophy, etc. I know that they're ex-Apollo and from what I've heard, they take fresh undergrad analysts? I figured west coast would be DLJ/LA types but what about culture on the east coast?
My guess would be: hours = bad, compensation = good, culture = relatively hardcore.
from a performance perspective at least, their PE funds have all put up very solid returns
They acquired the Allied Capital (that's how they got the BDC). Know a person who works in MO, comp is pretty solid for a non-front-office position and better than some other MO roles at big buyside firms but as Frank and Pareto said the culture is pretty aggressive.
Ares Commercial Real Estate Private Debt Group (Originally Posted: 09/24/2012)
Looking for insight into Ares CRE - Private Debt Group...culture, pay, hours etc...thanks.
bump
Also curious as well.
Still curious. Anyone?
believe it is a separate debt investing platform, primarily using capital out of their REIT. work alongside the former area guys (equity) to supplement the overall RE platform at ares
Thanks, any idea on comp compared to BB Banking / BB Capital Markets / REPE / General PE
Bump
One thing I can tell you is that all they want to do is mezz. No one seems interested in senior pieces these days. Just have hundreds of groups all chasing the same mezz opps. Markets are getting crazier by the day.
Ares Capital Markets (Originally Posted: 11/10/2012)
Does anyone have any insight on culture, hours, reputation of ares capital markets? Doesn't seem to be much info in older posts. TIA
guess this depends on DCM/ECM/Lev Fin
What in god's name are you talking about?
Does anyone know what the interview process is like? And any information on the group?
Ares Private Debt Group (Originally Posted: 09/11/2013)
Anyone have insight on this group? Culture/hours/comp? Wasn't able to find much from searches...
2 month later bump
2 months later bump
I hear comp is decent, work hours are better than banking (more like PE/Mezz). Seen a few ex-boutique bankers go through and end up at PE, merchant banks or other similar shops (i.e. NXT)
Any idea of the real estate private debt group? Curious about comp at the VP+ levels.
Ares Private Debt - Real Estate (Originally Posted: 01/22/2014)
Anyone with any idea on career opportunities, comp structure, prestige?
also curious
Bump, anyone?
ARES Private Debt - Real Estate (Originally Posted: 01/28/2014)
Anyone with any idea on career opportunities, comp structure, prestige?
Good company
Thanks - any more info? Specifically I'm curious how does it comp out to REPE or just PE in general in terms of 'prestige', which more or less translates to comp and career progression.
No idea but you could start here
http://www.glassdoor.com/Salary/Ares-Management-Salaries-E35082.htm
pretty sure you won't be disappointed in their comp
Just heard from someone that the bonus number is ~30% of base. Does that sound accurate? That's a little disappointing to me.
^that sounds wrong. Should be higher. I know some of the boys and they're paid better than that.
Associate pay at Ares Management? (Originally Posted: 10/19/2014)
Anyone know how much an associate makes all-in at Ares in their debt fund?
According to 1 entry in the 2012 WSO compensation DB, 185k.
http://www.wallstreetoasis.com/company/ares-management/compensation/ass…
Ares, Prospect, and these other large public BDCs usually all pay around the same, they might even list it in their earnings transcripts (i.e. "we aim for our employee compensation to be 50% base and 50% bonus) and then it's very easy to figure out once you go to glassdoor/payscale and look at the base because it's pretty standard across the BDC industry.
Usually it's less detailed work if you're focusing on senior/secured loans but the pay is less than traditional mid-market PE firms. Hours can be slightly better or worse than PE, depends on group/timing/firm.
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