Just started at a hedge fund, >$20 bn AUM and been around for 30+ years. Very very surprised to learn they do not provide a work laptop, work phone, lunch stipend, dinner stipend, gym stipend, Ubers home, or even 401k match. Base is 150k, bonus discretionary obviously. Honestly really surprised, they told me the benefits would be very competitive, so I didn’t even ask about them during comp negotiation bc i was aftaid it would look bad (bc usually it would be a rounding erorr in most instances). Thinking this stinginess would reflect in comp later on and already thinking of recruiting elsewhere. Am I right for being this surprised? Or is this normal actoss the industry?
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Definitely not normal across the RE industry....
Not normal. Which location?
Based on the most helpful WSO content, your concerns are valid, and these could indeed be considered red flags, especially for a hedge fund of that size and tenure. Here's why:
Lack of Standard Perks: Many hedge funds, even smaller ones, typically offer perks like work laptops, phones, meal stipends, gym subsidies, and transportation allowances (e.g., Ubers home after late hours). These are considered standard in the industry, especially for firms managing over $20 billion in AUM.
401(k) Match: The absence of a 401(k) match is particularly surprising. While not every fund offers this, it's more common among established firms, especially those with a 30+ year history.
Competitive Benefits Expectation: If they explicitly stated that their benefits would be "very competitive," the lack of these perks could be seen as misleading. This might also reflect a broader culture of cost-cutting or stinginess, which could extend to compensation and bonuses.
Industry Norms: Hedge funds are known for offering attractive compensation packages, including both salary and benefits, to attract and retain top talent. The absence of these perks might indicate that the firm is not prioritizing employee satisfaction or is operating under tighter margins.
Future Compensation Concerns: Your intuition about this potentially reflecting in future compensation is reasonable. If the firm is cutting corners on basic benefits, it might also be less generous with bonuses or raises.
What You Can Do:
In summary, your surprise is justified, and these could be signs of a less employee-friendly culture. It’s worth keeping an eye on how this develops and being proactive about your career trajectory.
Sources: AM vs HF: The Business of Our Business, Explain to me like I'm a 12 year old the benefit of a hedge fund, ''Don't bother joining the hedge fund industry'', What should I know before starting a Hedge Fund?
No work laptop is weird. The rest are hit or miss in finance. My company doesn’t match 401k, but instead put in 3% of your base up to 300k without a match and then makes a once a year profit sharing contribution. Last year, I got 24k total, which is pretty good.
It could be that your company is cheap or it could be that they don’t do the “perks” and pay you better at the end of the year. I would ask a colleague their opinion.
I thought so but I know people in IB at a BB that didn’t get work laptops.
We're missing one key detail. What's the bonus?
Most of these are normal, never been at a fund with stipends, have been at multibillion $ funds that don’t provide a work laptop or phone. As long as bonus checks out I wouldn’t worry but… I think it looks worse to NOT ask about comp at all before signing. As a value investor your employer won’t pay you more than they have to. And I would prefer my junior have some healthy skepticism if they’re to be a performer on the short side
Big MMs are surprisingly cheap on this stuff, which makes sense as they want most expenses running through pod P&L. Even then I was surprised to see policies where they don't allow first class booking unless you come out of pocket for flights less than x hours (even if you are a PM making 10 bucks a year.
What is the point of booking first or business class on a NYC-MIA flight?
Not saying it is needed but if you are an MD in banking or PE I guarantee it is company policy to fly business / first on every flight.
work phone/laptop is the only weird one, most firms care about cybersecurity and dont like people mixing personal devices
other than that everything is hit or miss....its also not really banking where youre at your desk 24 7 and in the office until 2am so that youd need food stipends and uber stipends
you'd be surprises the amount of cyber security issues that are caused by having a shitty IT team that handles all the corporate devices. It costs $$$$ and it's less secure?
Better to not provide corporate devices IMO. Just use secure msging channels and you're golden.
Not great if your firm gets in some sort of trouble and you're subpoenaed for your personal device data
not red flags as others have said. dont really think of HFs having proper perks for the most part, especially compared to client facing businesses like banking or PE (not client facing but somewhat of a hybrid because you still have to network and have to have mgmt like you if you want to close a deal)
Sounds like you're making great life choices there so far, keep it going young Padawan
I would also think about recruiting elsewhere because my employer didn't pay for my uber back home
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