Leaving for another fund - How to deal with current employer?
Hi all,
I am a quant researcher and sub-portfolio manager in my current place. For those people who have successfully left for a better fund, are there any advice you would like to share with respect to making a smooth transition? What are the to dos and not to dos?
I also have the following specific concerns.
If my contract does not explicitly state that I need to name my next employer, it is necessary for me to furnish this information to my boss? I fully intend to serve out any non-compete imposed by the contract. My boss has a history with the place that made me an offer, and letting him know where I am going is pretty much burning bridges.
Is there any possibility of obtaining audited or official PnL for my strategies that are live and the AUM allocated to them? How would one go about negotiating these?
Boss will find out whether you tell him/her now or wait. I’ve always told ans handled it graciously. Appreciate the time you put into developing me and I will always think of myself as an alum of fund X
You can ask but typically if you haven’t negotiated for that on the way in, 1) they’re in a position to jam you and 2) auditing ex post is difficult.
1) Don't offer that information voluntarily 2) You are unlikely to get any of this unless you have something to offer them 3) Be careful on IP with your strategies. Don't count out them "cheating" to prevent you for working at the new employer.
Hard to hate you too much if you keep thanking them?
How can they "cheat" him/her to prevent you from working at the new place? Assuming the new place makes an offer and is happy with the gardening leave or non compete outlined in your contract with the old place there is nothing they can do?
They can do anything they want to him if they are dishonest and he has an arbitration clause in his employment contract.
OP here, thanks for your response.
Definitely not going to volunteer the information, hence this thread. It just occurred to me that the info might be necessary for the non-solicitation clause. Do you think this might be the case?
1) have you asked for better terms at your current shop? lets say you are running 100mm and get 15% of your PnL...assuming you have been doing well recently...have you asked for 500mm and 20% of your PnL (or whatever makes sense)? Can it hurt you to ask the current place for the terms you are looking to get at the new place?
2) when leaving, why not just say you are feeling burnt out, have family issues you need to dedicate your time to (raising children is a fulltime job and you want to be home with your kids), and so you want to retire (this does happen).
(obviously, you can't try #2 immediately after trying #1)
assuming you don't register to the new place with finra or whatever, and don't post anything to social media, and don't tell anybody (and i mean ANYBODY) anything other than the above...after your non-compete expires, its hard to imagine a firm coming after you a year+ later
. If the person hiring you has a non-solicitation clause - that is their business. You are not violating anything by going to work for them even if they have one. I.e. your current employer would have to sue them, not you.
It's a clever trap, but again - you have no obligation
They’re going to find out. You either tell them upfront like an adult or they find out a few weeks from now. What’s the benefit of waiting?
Places will definitely not be friendly but as soon as they start screwing people for no reason, they lose the ability to hire.
My views:
1) I always tell my current employer that my new employer has asked me not to communicate that I will be joining until after they have communicated the news to their investors/stakeholders. I then go on to disclose that (i) I will be remaining in the industry; (ii) that I will be joining a competitor in the same strategy (if that is the case); and (iii) that I plan to adhere to the legal requirements of the contract....namely notice period and non-compete period and that my new employer is aware of those T&C's. I then throw an olive branch and ask what I can do to make the handover as smooth as possible and if there is anything else I can do before my final day in the office.
2) You can forget about getting audited P&L or performance data....unlikely the firm will go out of its way to make life easy for you given you are the one leaving.
3) Try not to get emotional and remain calm and factual. This is a small industry and burning bridges is to be avoided at all costs.
This is just great advice.
Another important point is don’t take the bait if they ask what it will take to keep you around.
Depends. Strategy for this would be different if you are leaving MM-> MM, SM-> MM, MM-> SM.
Generally, MM-> MM is fairly straightforward and PMs understand people are always moving in this industry. Also, do you know if they will apply noncompete? This is an important point. If its an MM I would definitely negotiate getting strategies and current GMV, PnL etc (I'm assuming you run your own strats as subPM).
The other transitions require more nuance.
Arrangements regarding ownership of IP, performance stats and non compete need to be made when negotiating the employment contract, not when you resign. The old employer has zero interest in helping you when you move to another place. You are unlikely to have any leverage when you leave unfortunately
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