Former MS M&A / KKR here to field questions
PE
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on 11/26/10 at 7:42pm
In the spirit of thanksgiving, I have decided to host a thread where you can ask all you ever wanted about banking or PE. Please feel free to ask away.







Are you familiar with MS's
Are you familiar with MS's Firm Strategy & Execution group? Any idea on the exit ops for this group (or similar internal Corp Dev/Strategy at other large IBs) into PE? There doesn't seem to be a lot of info on such groups - quite curious.
I'm going to give it to you
I'm going to give it to you straight, if you want to maximize your shot at PE, you're going to want to stick to the traditional IBD groups where you get more of the analytical exposure that PE firms will want you to have. The firm strategy & execution group (or most internal corp dev groups at banks for that matter) will not provide you that background, even if you are gaining the MS brand. That said, I would pick an "inferior" bank where you can get better skills, perhaps M&A at a boutique. Of course, to the extent you can move into one of the more classic banking groups at MS (or a similar bank), that should be your first choice.
What is the compensation
What is the compensation structure/salary like for 1st year PE Associates at mega funds particularly at KKR. There seems to be more transparency for IBD/S&T but not so much for PE? Additionally, did you have to do a case study or take a modeling test for your interview with KKR?
in your opinion, what are the
in your opinion, what are the major differentiators of candidates that are able to gain entry into and succeed in the upper echelon shops? obviously there are hundreds/thousands of junior bankers every year, but only a handful get top buyside gigs, and even fewer are able to keep progressing. similarly, what made you so successful?
also, could you share your general thoughts on the rat race? if you were to go back, would you change anything? and now that you're in a pretty enviable spot, do you see yourself working just as hard to keep climbing the ladder? Whether you plan on continuing or not, if you were to leave finance, what would you do?
ixjunitxi wrote: What is the
What is the compensation structure/salary like for 1st year PE Associates at mega funds particularly at KKR. There seems to be more transparency for IBD/S&T but not so much for PE? Additionally, did you have to do a case study or take a modeling test for your interview with KKR?
Basically compensation is comparable to that of a 1st year associate at an investment bank, maybe a little higher. KKR base is 100k which is along the same lines of some of the other comparable mega funds (BX, Carlyle, Bain, TPG). THL pays 125k, Apollo is known to pay 140k. Some other shops are all over the place (not confirmed but heard Crestview pays 150k). On the bonus side of things, it is fairly volatile, 400k a year may have happened once upon a time, but is certainly not realistic anymore. All-in comp is probably targeted somewhere in the 250kish range for the major shops. Regarding the case study, KKR does do a case study but it is not as rigorous as everyone makes out to be. It is basically a test where you will analyze a business using the information they provide you and you will be asked to put some materials together using excel, but then you will have a conversation with an associate or principal about what you put together. The modeling exam should really be the least of your worries because if the finance is not intuitive to you at that point, you will have an even more difficult time in the interview when you are expected to think on your feet.
What are your hours like?
What are your hours like?
greenapple wrote: in your
in your opinion, what are the major differentiators of candidates that are able to gain entry into and succeed in the upper echelon shops? obviously there are hundreds/thousands of junior bankers every year, but only a handful get top buyside gigs, and even fewer are able to keep progressing. similarly, what made you so successful?
also, could you share your general thoughts on the rat race? if you were to go back, would you change anything? and now that you're in a pretty enviable spot, do you see yourself working just as hard to keep climbing the ladder? Whether you plan on continuing or not, if you were to leave finance, what would you do?
I think personality is typically key, there are more than enough number crunching asian monkeys from wharton (pardon my language) that could fill the ranks of all the major mega funds. They key is to not only have those same number crunching skills, but also the other skills necessary to be the full package. I think as with anything else luck plays a large role in anything, but it is important to stay focused. Although you may not land your top choice whether that be in banking or PE, if you work very hard and have your stuff in order, you will likely be able to land a pretty good banking job, and a pretty good pe job (even if that means citi and madison dearborn, instead of gs/ms, kkr/bx etc.) At the end of the day, all this shit is more or less the same and the incremental difference between shops isn't as monumental as some people on this forum make it out to be. That said, for the most part brighter people will tend to be at better shops.
Regarding my thoughts on the rat race, it is what it is. I don't think I would change anything as I recognize that I am in a fortunate spot. That said, any kid who is 3-4 years out of school and thinks he has it made just because he works in PE is a bit delusional. A career in finance really starts in the junior MD role, everyone else is a glorified slave. As far as staying in PE, I don't think it is what it once was now that many of the premier PE funds have started to go public (KKR included). They aren't the nimble organizations (with the same upside potential) that might have existed a generation ago. To be fair though, there may not be as much upside in finance in this generation as in generations past.
Mezz wrote: What are your
What are your hours like?
Contrary to popular belief, even for the so-called "New York sweatshops," the lifestyle is significantly better than in i-banking. There is a greater degree of dignity afforded to your time and quality of life in PE that certainly does not exist as a junior banker at a large investment bank. Yes, when you are on a deal, you are a slave again, but it is usually for a much better reason than a client-service pitch book. On average, you will probably get in a bit earlier (8:45 AM or so) than banking, but you will probably also leave around 9pm or so on average. The perks are also better, expensing policy is more lax, and you eat lunch in a dining hall. That said, when times are tough, they are tough, and that is finance afterall. Net net, definitely better than banking.
Sent you a PM
Sent you a PM
Hi, I like the spirit of your
Hi, I like the spirit of your thread.
Is it still possible to transition into PE if you're a post-MBA IBD Associate, or is one perceived as more expensive than an analyst but also less open to being a grunt? Or is the post-MBA track a long-term career move that only gives you options once you reach MD level (where, as you say, you stop being a glorified slave and then your value is in your decision-making skills, network, etc)?
I believe I have the chance to get perhaps 6 months of pre-MBA PE experience at a small-ish fund, through networking. Would that make a significant difference during MBA recruitment, or would IBD still be the only option in the world of M&A?
Thanks! Enjoy the turkey and pumpkin pie.
Does KKR (and most mega-funds
Does KKR (and most mega-funds nowadays) have a 2-year and out program, or do they encourage you to stay for a while? If they do encourage you to stay for a while, do most people still go to B-school after two years?
Thanks for the thread -- it's
Thanks for the thread -- it's refreshing to see something relevant on this forum. How well are the elite boutiques (GHL/EVR/LAZ/BX) represented in the top megafunds? Do you think they are overhyped on this forum?
Any advantage of M&A over
Any advantage of M&A over Sponsors?
jtbbdxbnycmad wrote: Hi, I
Hi, I like the spirit of your thread.
Is it still possible to transition into PE if you're a post-MBA IBD Associate, or is one perceived as more expensive than an analyst but also less open to being a grunt? Or is the post-MBA track a long-term career move that only gives you options once you reach MD level (where, as you say, you stop being a glorified slave and then your value is in your decision-making skills, network, etc)?
I believe I have the chance to get perhaps 6 months of pre-MBA PE experience at a small-ish fund, through networking. Would that make a significant difference during MBA recruitment, or would IBD still be the only option in the world of M&A?
Thanks! Enjoy the turkey and pumpkin pie.
Appreciate the support. Regarding the transition into PE at the post-MBA IBD level, it is incredibly difficult to get into a megafund (especially in this market) if you are not from a traditional background. KKR will typically only really look at you if you did 2 years at a top bank, 2 years at top PE and then HBS. Are the only people in the world qualified enough to work in PE made of this mold? Absolutely not. Is life tough? Yeah, it can be. That said, absolutely do not make post-MBA decisions with an eye towards exit opps, this typically turns out badly. Associates in IBD do have exit opps, but they are not as clear and regimented as their analyst counterparts. In middle market shops it is probably not as regimented, but you will still absolutely need meaningful pre-mba experience that is hopefully related to finance. Exceptions to the rule always exist, but I am just generalizing here because generalizations are the easiest things to discuss.
Regarding the value of the MBA, it absolutely helps, but nobody is making promotion decisions based upon where somebody (or if) went to business school. However, a person may have a significantly better network because of their MBA contacts. That said, there are partners at KKR who skipped the MBA and are doing just fine. To each their own, and you really have to weigh the costs and benefits when you are faced with it. It is unlikely though that somebody will be a superior dealmaker solely because of the fact they have an MBA. Lately the trend seems to be that b-school for non career switchers is coming out of vogue, but that said, an MBA will still provide more career versatility down the road.
Regarding your plight, I would suggest you try and get that pre-mba PE experience as it will significantly boost your profile (and relevance) when you apply for those jobs post-MBA. You should not take a cut in pay or responsibility to get this position though as it will look weird on your resume or as you speak about it.
chiphifrat wrote: Does KKR
Does KKR (and most mega-funds nowadays) have a 2-year and out program, or do they encourage you to stay for a while? If they do encourage you to stay for a while, do most people still go to B-school after two years?
Generally 2 year and out although this is becoming less so. You will see some superstars these days getting promoted to the post MBA level although there is still a preference for the MBA. Many kids also will leave to go to hedge funds (tiger cubs and the like) as the large PE funds are becoming more bureaucratic (it comes with the territory when you are publicly traded) and as such, harder to advance in. There isn't that much encouragement to stay, it's still a dog eat dog work place, so it's not like you're in a fund of 10 people where people are begging you to stay. You can still be replaced.
PennFranklin wrote: Thanks
Stringer Bell wrote: Any
How is JPMorgan? Any specific
Hey 10xleverage, thanks a lot
I guess I want to know is
Sent you a PM!
Thank you for the post,
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10xleverage
Can you explain what the
can we drop the pm's and ask
WSO Conf - June 29, 2013
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Really appreciate that you're
This is great, thanks for
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Sounds like basically all
There have been many great comebacks throughout history. Jesus was dead but then came back as an all-powerful God-Zombie.
Excellent forum. It's nice to
do people at either firm
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For a first year analyst at
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Kenny_Powers_CFA
10xleverage wrote: 2x2Matrix
One of those lights, slightly brighter than the rest, will be my wingtip passing over.
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