Dilemma: Switching Jobs

My views for what it's worth.

There are definitely levers to improve marketing execution at a fund. As you get more senior at a fund, you can understand and advocate for this better. At least by having good performance your fund has a better base to do this, and that's a real asset. Understanding how they aim to grow is important, but growth can be chunky and the timing is unpredictable. But if you're at a fund where you wonder why it hasn't taken off yet, sometimes those do. I interned at two funds that had strong performance and sub $100M AUM over a decade ago. They kept their performance up and are now in the billions. The people I worked with who are still there are quite happy but were paid below market for years before that.

I repeatedly chose to work for high quality people where I learned a lot over more brand name or higher paying jobs where I wouldn't. This left a lot of money on the table early in my career.

My thoughts are that the only sustainable path to having some long term control of your career in an industry as Darwinian and accountable as public markets is being a world class investor with a strong network. Your best chance of becoming a good investor (though it's not a guarantee) is to work for people who are skilled and invest in you, especially in the first 5 years of your investing career.

If you are wondering if you're developing well, try to track how well you're improving over time or relative to peers. This could be how your investments performed or something like an investment diary that lets you see if your thought process is getting more sophisticated. Likewise, I would reconnect with peers/more senior investors after a year or two and see if my thought process had progressed relative to theirs? Was the amount of insight I was bringing to the conversation higher? Was I becoming better than people I looked up to? This requires trying to be really honest about your strengths and weaknesses.

Staying at a smaller shop also meant I eventually got a profit share. There are two obvious advantages of this. These businesses can have very strong operating leverage if you don't go crazy on expenses. Also, you don't sink tons of energy into fighting about your bonus every year. Over time, the extra layer of politics you need to do to claim a bonus takes a toll.

In terms of how people will react, hard to know. In public markets the time spent training someone can be used instead by seniors to generate more ideas and those ideas are immediately actionable, so senior people may view somoene's decision to leave in light of that perceived opportunity cost of spending more time on the book. That can make training a relatively inexpensive person seem very expensive.

I've known some people to be quite salty about folks leaving and others are more gracious. How they refer to ex-colleagues is a clue. If you leave, you need to go out of your way to be nice about it as HF is a small world, How they talk about you externally with clients is also important. If they're giving you visibility here, it's more reputational cost for them if you leave. This gives you bargaining power internally but also makes them more likely to be upset if you go. If you get promoted, it may make the job market less liquid (fewer senior seats) but it also makes it very clear you were valued at your first shop. It's hard to know who at another firm is good. In a world where every analyst trying to lateral claims to be the best person at their firm, recognition from the firm itself is a strong signal to prospective employers.

I am glad I took the approach I did, and it's yielded an outcome I'm grateful for. Of course, your mileage may vary. Your training and culture have to actually be good. But bear in mind of my business school class who went to public markets, less than half made it a decade in the field. Lots of famous funds close over a decade. It's hard to survive if you're not good, and likewise, if you're in an environment you don't like, you're less likely to stick it out once you have a bit of money.

It sounds from your post that you want to stay and want some reassurance this is rational. I think it is. The money I left on the table early in my career has been repaid many times. Your mileage, of course, may vary. But I would think about it in terms of your own growth, not the current or "estimated" growth of the firm. Good luck with your decisions.