PE bonus
I have a question about bonuses for PE analysts though (couldn't find it in the old posts). My fund just sold one of the portfolio companies and netted a 90% return. How much can I expect to get as bonus? Can I realistically expect a minimum of 1% of the gain to a maximum of 5% of the profit? The deal team size is very small (1MD, 1VP, 2 Analysts). Anyone can shed some light on how bonuses are distributed in PE firms? I haven't been around long enough to know how these things work so any comments would be more than welcome.
You should have asked your MD earlier what your piece would be.
Do you have carry?
My fund doesn't distribute bonuses for portfolio companies sold. We do get a nominal bonus (~$20-25K for first/second years) when a deal closes - but this is not limited to the deal team, everyone at the fund gets this.
Aside from the co-invest, which really isn't a bonus, the vast majority of our bonus comes at year end when we get our performance review.
no carry when i signed. but that's been a while ago and it hasn't been reviewed for quite some time. i'm trying to see if i can get a small % of the big profits after selling the investment.
no co-invest for me either.
i guess i'll ask the MD about it before the bonus is paid out.
I'm amazed that your compensation package wasn't explained to you well enough for you to know the answer to your question. I'm also amazed that, without being told you'd get a bonus/% cut from the sale, you'd think you might get anything. Getting a % cut of the fund's profits is called carry. If you have it, you know it. If you don't, you get your salary and your year-end bonus and that's it.
Now, it's not totally unusual for firms to pay their junior people spot bonuses of 10 or 20K here and there when there's a successful event, but never as a percentage of profits.
Do you really work at a PE firm?
What is the standard base for an incoming analyst at a PE shop following a 2 year IB analyst stint?
Jeremy, just like investment banks, it can really fluctuate depending on the shop and the location. Do you have any specific PE firms in mind?
Talking more along the lines of a mid market shop.
yes i really do work for a pe firm. it's just that my contract doesn't include a carry in it, but this deal that we just closed is so successful that i think will warrant some profit sharing. the deal team size is small, which makes me think that a bonus would be on the way. the reason why i asked was because i want to see what other pe analysts are getting (% of profits) so to compare to what i think i'll get and eventually get.
what a fucking idiot
DBIAF- No need to showcase your 10-year-old behavior. What exactly did your post contribute?
MOST pre-mba PE professionals don't get carry (i.e. % of the profits). Carry usually starts post-MBA and grows as a percentage as you move up the ranks.
Also, you said your deal team is small. Does this deal team comprise the bulk of your firm?--because the carried interest from a deal doesn't just go to the deal team, it goes to the entire general partnership. And the GP's would have to decide if they wanted to share the wealth to give you anything.
It wouldn't be unusual for you to be rewarded with a token of appreciation for your involvement in the deal, but it would only be out of the pure goodness of the hearts of your firm's partners.
i see. thanks for your constructive comments ibleedexcel. greatly appreciated.
the deal team is small and comprise the bulk of my firm. i keep hearing that i'll get a 'big' bonus (probably a tease by the other seniors) so i'm tryiing to figure out what 'big' means.
i understand that what's big to one person may be small to another, so just trying to get a basis for comparisons.
Qui libero optio mollitia nemo et aut. Dolor eius voluptatem voluptatem sapiente.
Dolore et quasi provident. Commodi qui qui vel. Minima deleniti magnam fugit officiis aut libero. Dolor voluptatem et sed est ea.
Eligendi et quisquam et non minima eum. Odit earum minus voluptas quos et. Minus et est rem ratione. Numquam qui ut architecto quis rerum. Ratione placeat nostrum et vitae quisquam voluptatibus. Tenetur voluptatum itaque commodi perspiciatis voluptas voluptatem quis quos.
Dolorem natus dolores consequatur sint quo ut. Aliquid dolor sint est quam. Quas rerum unde sed qui ea dignissimos. Numquam impedit ea velit quae. Laborum error nisi et pariatur. Aliquid necessitatibus sed rerum est. Tempora qui et illum accusamus recusandae.
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...