HIG Capital: modeling test advice/insight?

I searched through the forum and it seems like HIG Capital is a legit shop even though they pay below street.

I have a modeling test coming up and was wondering if anyone has taken it with them? If so, any insight and advice would be greatly appreciated.

Thanks in advance

 

I've never interviewed with them, but I've done some work with them in the past. They are definitely a legit PE firm.

I think they may have taken a bit of a beating in the downturn, but that's the case with plenty of shops. They are mid-market focused and like out-of-favor sectors and underperforming businesses.

 
Best Response

It's a basic LBO with balance sheet, income statement and cash flow and key is that it balances. They give you pro forma balance sheet adjustments to get to an opening balance sheet.

HIG is a legit PE shop but below market pay in all offices is just the start of it - you have to buy your own blackberry, they reimburse you 90% of cell bill but not for text messaging, do not provide you a laptop (you have old Dell desk tops and they have a few heavy as brick laptop loaners if you travel), just really cheap all around. They allow analysts to co-invest in deals and give you some "loans" to help you co-invest. If those deals go really well it can be good money 2-5 years after the deal and that is why they pay less comp, but the PE market has changed and returns are still good but not what they used to be and the current cash comp is so low it does not seem like a good trade as an analyst unless you can not get a job at another legit PE shop that is doing deals.

You will work long hours and don't plan on being asked to attend many meetings outside the office as they want to keep expenses low so junior professionals don't travel unless really needed on-site for analysis.

 

Suspiciouns are as substantiated as possibly can be without having worked there: 1. Comp is significantly under the street but they try to work you over on the South Florida angle as well as the "no state income taxes in Flordia" and cheaper standard of living (all of which are partially valid points, but IMO not quite compelling enough). First year associate all-in comp of about $150K. 2. Is absolutely a sweatshop. So the South Florida sell is only marginally valid since you don't get out much.

 
Marcus_Halberstram:
Suspiciouns are as substantiated as possibly can be without having worked there: 1. Comp is significantly under the street but they try to work you over on the South Florida angle as well as the "no state income taxes in Flordia" and cheaper standard of living (all of which are partially valid points, but IMO not quite compelling enough). First year associate all-in comp of about $150K. 2. Is absolutely a sweatshop. So the South Florida sell is only marginally valid since you don't get out much.

$150k all-in?? Wow. I know the base is $90k, which is already lower but figured the bonus at least got you to $200k. At $150k all-in, I'd rather stay in banking as a 3rd year analyst - stay in NY, pull in $190k (top bucket) and have a significantly better lifestyle as a 3rd year...

 
Marcus_Halberstram:
Suspiciouns are as substantiated as possibly can be without having worked there: 1. Comp is significantly under the street but they try to work you over on the South Florida angle as well as the "no state income taxes in Flordia" and cheaper standard of living (all of which are partially valid points, but IMO not quite compelling enough). First year associate all-in comp of about $150K. 2. Is absolutely a sweatshop. So the South Florida sell is only marginally valid since you don't get out much.

Interesting, I've heard the exact same things from multiple sources at my bank as well. These guys apparently cut you both ways in that they work you to death and then to add insult to injury, pay you meaningfully below Street.

One of the stories I've heard was that there was an analyst in another group at my bank a few years ago who apparently only had an offer to HIG in Miami and after unsuccessfully trying to leverage it into an offer elsewhere, decided to simply take a year off and go hiking in Europe rather than work there. Never met the kid and its obviously hearsay, but an interesting data point nonetheless.

Also havent met anyone from there or been through their interview process, so I cant say personally, but the juice just doesnt seem worth the squeeze with these guys...

 
GetRichorDieTryin:
I searched through the forum and it seems like HIG Capital is a legit shop even though they pay below street.

I have a modeling test coming up and was wondering if anyone has taken it with them? If so, any insight and advice would be greatly appreciated.

Thanks in advance

HIG's a great shop. Take the gig if you can get it. Miami is the hq but other offices legit as well.

 

I've actually met with the Miami office...to their credit, the guys from the middle market and lower middle market funds are good dudes and clearly intelligent. Bayside - weird people, steer clear. Their model is also good in that they don't staff analysts until there is a letter of understanding with a target. Associates will turn in first-round bids without analysts (basically just applying a multiple), so analysts only work on deals, and they do a lot of deals. So seemed like a good experience. The comp breaks it for me though. Miami was nice though.

 

I hear they have had a lot of analysts turning them down this year because of comp and work environment and Bayside debt fund had a few leave as well. They took advantage of the market the last 4-5 years and have not moved cash comp at all or changed any of the other rediculous things like making you purchase your own blackberry and penny pinching all around and looks like it may be tough for them this year given how late in the year it is. Headhunters are calling all over looking for analysts in Miami and I think NY office still has not landed the one Analyst they are looking for. That being said if you don't have any offers you can last through two years of it and hopefully get into a top tier B-school.

The comp does not improve post-MBA either according to a couple people that work there- it's the guys that have been there 8+ years that are making above market comp due to the firm success because thier carry in funds II and III have paid out but if you were not in those funds its been a tough slog I hear as there have not been as many realizations yet in LBO fund IV (current fund) so the 1-8 year post MBA people live off the way below cash comp. If people find other top tier PE firm opportunties they jump is what I have seen as the comp and carry allocation is way below market. I also heard that the carry never actually vests, its phantom carry, so when you leave, even if you are there 4-5 years post MBA, you dont take anything with you and start over from 0 unless you can negotiate with another firm to give you something in thier fund. I think this has to be the only firm that does this. Anyone know?

 

Phantom carry is a synthetic way to benchmark a component of your comp to the performance of the companies in which you worked on. Its generally not the norm for jr. level people, I have seen it a bit more often for jr people at very small shops (i.e. family offices), usually as a solution to longer holding periods.

HIG is MM PE. Definitely not upper MM PE, and street for a normal MM for a 1st year associate should be ATLEAST 200K IMO. Particularly considering that as a 3rd year analyst you should make at or about 200K.. obviously if you're at Harris Williams or the like, your comp will be slightly less than this... in which case it makes more sense to go to some of the MM PE firms that pay less since its still more than your slightly below BB comp you'd be getting at the MM investment banks.

 

Pre-MBA should not be looking for carry, phantom or otherwise. I was just pointing out the general theme of issues I have heard about HIG regarding comp and when talking about the phantom carry was talking about post-MBAs who at other firms would get vesting carry in the fund they work for. It may not vest until after the second year of joining but then generally vests 20% each year so that if you leave you still have earned some economics for the period of time you worked for the fund (i.e. your stock options have actually vested and are yours) and the fund may buy back your vested carry or let you keep it.

 

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