Fund Placements for Private Equity Firms - Looking for advice
After almost 5 years spent in M&A, IB (coverage group) and Merchant Banking, I am now looking for advice on how to transition into fund placement.
I have read quite a lot about this topic and I want to join a group in charge of raising capital for Private Equity (and Hedge Fund) firms.
From my perspective, the job looks really interesting: international exposure, involves strategy, consulting and people skills.
I would be really interested if someone already in the business could:
- Briefly describe the job as a junior (Analyst, Associate or VP)
- Share the positive (and negative) aspects of the job
- Let us know what are the technical aspects of the job
- And lastly, how a background in IB is look upon to work in Fund Placement?
I am hoping someone will shed some light on this little known division of finance.
Thanks a lot!
Heavy Bag
Interesting topic. Also would like to hear someone's opinion about it.
bump!
I interviewed for a very junior role in a private funds placement group, and was also coming from a traditional industry team IB background (although I had just under 2 yrs of experience at the time).
I'll try to give you an answer from my perspective -
The whole job entails preparing Private Info Memos (PIM's), which is basically a very comprehensive prospectus of the firm, its people, its past and present funds/portifolio companies and returns, its intended strategy for its new fund etc. Not much in the way of client interaction at a mandate-winning level.
Positives would be exposure to the investor community, understanding the PE industry away from the direct investing side and a pretty good lifestyle/pay ratio. From what I gathered, bonuses are nowhere near IB, but still relevant.
Negatives would be the lack of technicality in the role. IE not really any valuation work, except maybe doing some rough calculations on certain companies as part of the PIM.
Covered above
They seem to value your presentation making abilities, and attention to detail, co-ordination skills, knowing broadly about the industry etc.
I intern at a placement firm, and as an intern, mainly just reading news from tons of sources and documenting all relevant data to try to find investors for various current and future funds they are raising. The other analyst are the ones doing the calling, meeting clients, negotiating deals, and bringing finding more GPs to raise funds for.
There are quite a few positions open out there for placement/fundraising. You'll need to develop or "farm" relationships with HNW institutions/individuals that constitute your LP base.
I would be grateful for an update on the pay scales for fund placement positions. Does anyone have any concrete figures for base + bonus at analyst and associate level?
Ok I deal with these guys all the time at all levels and many are friends.
There are two sides to placement. Origination/Project Management and Distribution, often people do a measure of both.
In the former, you are landscaping the market, seeing who's looking to raise, what looks interesting and facing PE funds and convincing them that they need your help raising money and why they should pay you (sounds a lot like banking). Or PE funds come and beg you for help... Then you do a DD on the Firm, the team its portfolio companies, call LPs and companies to reference them etc. You then make a case to the team of why or why not the fund should be taken as a mandate. The distribution guys who deal with LPs and consultants etc tell you their thoughts and what they are hearing from LPs etc (ie. how much appetite there may be for the product). Let's say the fund passes and the group takes it on as a mandate. Now you pretty much sit back and write PPMs, collect data from the pe shop, make pitches etc and deal with LP questions, data requests, fill out LP DDQs/RFPs (not fun) etc. Much less client facing.
In the latter, you may go to initial pitches to the Fund and assist with some DD and canvas around. But mostly your job is distribution, ie. selling the product. This means that you are organizing roadshows, dealing with logistics, telling the fund how to pitch to investors, canvassing LPs on their thoughts. You're probably doing a lot of pitchbooks as well. You are on the road a TON. Some of my friends are on the road like 75% plus of the time.
OK. That's a basic primer.
The good? Good pay, a bit more stable, potentially very very lucrative (especially outside the big banks), lots of exposure to funds/investors/everyone in the investor world, essentially. If you travel its premium travel, so nice hotels, business class seats, good meals etc.
The bad? Not technical, its just pitching in the end really, lots of PPT, exit ops are only to IR or FoF or another placement shop, you are the lowest of the low on the PE industry totem pole (ie. most people do not respect placement agents as a profession), constant travel (ie. tough to keep or build friendships/relationships), not too intellectually stimulating...
I can't tell you about pay because it varies incredibly wildly depending on the firm and mandates. But it can be quite lucrative. To the OP - with 5 years of experience you could probably be a VP/Senior Associate. I am sure I missed some things here but I hope that this helps.
does anyone have any details on pay?
Would be very grateful if anyone has details on what your hours look like at some of these places (below 60)?
fund placement firms - Analyst/Associate roles there? (Originally Posted: 12/02/2009)
Was wondering if anyone can shed some light on this. What are some of the responsibilities/ skill sets developed as an Analyst or Associate in fund placement groups like Atlantic-Pacific Capital, Park Hill Group and Campbell Lutyens & Co.?
What are the exit opps for these guys? I'm guessing PE FoFs, but would they be able to go to direct PE shops too?
I haven't researched the firms you mentioned but we did meet with a couple of fund placement agents when trying to raise a PE fund, Probitas Partners was one, and my impression is that the skill set for junior level people is more oriented towards market research, pitchbooks, presentations etc Unless of course you're advising Secondary PE firms, in which case the skill set developed could be different.
As far as fund placement goes, I don't think the skill set lends itself towards a role in PE FoFs, Secondary PE funds and definitely not Buyout shops. After a stint at a firm like that, you could look at roles in Investor Relations or Business Development at large PE funds of HFs.
Fund Placement Specialists (Originally Posted: 07/30/2012)
Hi,
Anyone here have any experience selecting a fund raising/placement specialist? Specifically for raising a fund for a PE (specifically early/mid/late stage venture and small fund sizes)? I know you obviously have your BB's / elite boutiques that have private fundraising groups, but they generally look for large funds only...
If anyone does have experience, could you talk a bit about the major players / provide a recommendation?
Thanks
Very curious at this too.
Eius aut laboriosam sit iure autem incidunt. Velit qui velit rem velit enim eligendi. Enim officia totam et nesciunt id.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...