Should I be concerned about where to start my HF career? Details inside
Hi guys, early 30s here with an extensive background in privates and what I would call a "privates" pedigree across MBB, UMM, and then some other odds and ends in startups that I won't be too specific about to preserve anonymity.
I've been interviewing for a mature, under the radar $bn SM L/S platform to cover TMT. It's a small firm, only a handful of IPs. My key diligence item is whether they are above or under HWM, it's hard to tell on the face of it, because I am not really an "underdog" kind of guy.
I'm wondering if it would be a mistake to go here vs. for example a more scaled platform like Coatue or Dragoneer or Dorsal etc. Let's just assume those are in reach instead of the "good luck" posts - I simply mean a larger more established firm rather than a discussion of these names, but to the extent you want to talk about a specific name as an example of training, that's fine.
I'm also wondering if it would be a mistake to go here vs. for example one of the recent launches from the Darsana/Soroban/Viking/Alua/etc. type background, like Kinetic, Untitled, XN, etc. Maybe not those specifically, but what those were a couple years ago; something like Otter Rock. I'm not exactly sure what the pro of these is other than during a consultation with a headhunter, he mentioned those are generally sought after.
I'm having to recalibrate how I think about risk because I've never worked in or done anything on the publics side other than tearing down comps of portfolio companies at my UMM PE firm. One of the things I've liked about this firm I'm interviewing with is it's very much "go find what works, go develop your own process, figure out how you can get comfortable with investing" vs. "here is a rigid process I use, please absorb that" and that the PM is more coach than foreman, as he is a veteran with decades of experience managing money.
Mainly, when it comes to the job search, I'm 1 for 1 assuming this works out, and wanting to make sure I'm not just taking the first thing that comes along, even though I like this one on face value. I've gotten hints in the process that now is the time to make up my mind and we'll finalize things soon. Thanks to anyone who can shed some light. Really appreciate it and hope you guys had a great Thanksgiving.
Starting your hedge fund career is a pivotal decision, especially given your strong background in privates and the options you're considering. Based on the most helpful WSO content, here are some key factors to weigh:
1. Firm Size and Reputation
2. Recent Launches (e.g., Kinetic, Untitled, XN)
3. Risk Tolerance and Career Goals
4. Key Diligence Items
5. First Offer vs. Best Offer
6. Headhunter Insights
Final Thoughts
Given your background and the options you're considering, the smaller SM L/S platform sounds like a strong fit, especially if you value autonomy and mentorship. However, ensure you've done thorough diligence on the firm's stability and performance. If you have the opportunity to explore other offers, it might provide additional clarity, but don't discount the value of a firm that aligns with your goals and offers a supportive environment for your transition to publics.
Good luck with your decision, and remember—your first HF role is important, but it's not the end-all-be-all. Many successful investors have pivoted between firms to find the right fit.
Sources: How to approach LMM PE recruiting?, Leaving a single manager to start a book at a platform, Life in Acquisitions (Analyst/Associate), Life in Acquisitions (Analyst/Associate), AM vs HF: The Business of Our Business
Thank you AI Monkey, looks like it's just me and you!
Any and all responses are welcome!
I don’t know what you’re trying to ask here
This is the main question:
The rest is color on what's important in my decision making process, mainly, how to become very good at the job and work at an exciting place that sets me up for success long term.
Also a bit confused on what you're trying to figure out here. You're asking if it would be a mistake to go there vs another type of fund?
I get you want to make theoretical comparisons, but you need to evaluate each opportunity on its own and if it fits what you're looking for. So what if another fund could have been better to start off at? Ik it's not what you want to hear, but it just doesn't matter unless other options are on the table
Maybe to reframe, the question is whether or not I should accept, because if someone were to say “this does not set you up best for a career in publics vs alternatives”, I’d be willing to roll the dice and continue looking for what does set me up best. Or the answer could be, “this actually sounds pretty good” and I’d feel comfortable with that. I have my own view but I’m soliciting second opinions from those who actually have good context on careers in publics.
Hi guys - thanks to those who have commented so far. Have a small number of days that this is still relevant so last call for any inputs. Thanks all.
What are you solving for? Upside? Longevity? Optionality?
Sounds like you don't actually have multiple choices. You might have one offer from the "under the radar" shop.
Count the number of "yes's" you answered to these questions and divide it by 0. If the answer is undefined, you should take the opportunity in front of you.
I mean if the "scaled" platforms are a choice, then yes.
If not, then evaluate what you got. You're already 30+ and hate to tell you but a lot of places don't want to hire a lateral that's 30+ and hasn't been responsible for a lot of $ before.
yeah you should consider yourself lucky to find a good HF seat with your background so holding out for something better doesn’t seem like a great idea
Also it’s incredibly hard to evaluate these situations generically. Who the people are and which firm it is really matters, moreso then a generic description of aum. Obviously you’re not going to disclose but my point is nobody in an anonymous forum is going to be able to give you the type of answer you’re looking for without actually knowing the specifics
Not that I have a ton of wisdom to contribute here, but one thing you mentioned doesn't sound great imo
""go find what works, go develop your own process, figure out how you can get comfortable with investing"
You don't want this - you want mentorship, especially given what you shared about prior experience. That doesn't mean a formulaic or rigid process, but if you haven't operated in publics before, you likely need someone to hand hold a bit on the market perception and "how stocks trade" side of the game
Yes, there is a whole world that takes a PE approach to publics. I also get that a lot of people will just say, yea identify companies undergoing change with a material disconnect on perception, and buying at right price = success.
The hit rate, even amongst the funds you mentioned, for doing this consistently well through cycles, is debatable. The game is evolving rapidly.
Don't think you want a seat somewhere that is more about letting you experiment on how to translate your success in analyzing businesses in the privates world to publics. You will likely have a much better career if you find a place that has someone who can really show you the ropes on what it means to navigate publics.
Almost everything about your opportunity going forward comes down to who you will work with / under.
That's it
You either work with someone who gets it, can share, and provides a good platform for comp growth. Or you hop seats a few times trying to find a home while clipping some dece paychecks but nothing life changing. The life changing money comes once you are independently responsible for driving a real investment process that generates some major coin.
just 2 cents
Thanks, all. Very helpful. Has pushed my thinking forward. Really appreciate it. All the best guys.
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