“Tier 1” MM Platforms
I’m embarking on the transition from PE to a HF and I don’t know many people in the industry so i’m hoping people here can help.
I know I want to work for a MM or MM-ish type firm - are there any firms I should be targeting my outreach to besides C / MLP / P72 / B?
I saw a post on here about Candlestick. Is a firm like that in-line with the household names?
Appreciate the help guys.
Focus on PM, not firm. Candlestick or Holocene are probably better than 80% of the teams at Citadel or MLP.
Makes sense. And appreciate it, will look into Candlestick and Holocene
How does one find out info about PMs and whether they’re good mentors/have a track record? Networking? Thanks!
Yes. But also try to figure it out - be creative. This job is largely about sourcing information and making bets, do the same when looking for a pm
Echo above, you should be targetting tier 1 PMs, and considering if firms like Holocene/Candlestick have them (even if not explicitly MM)
There are a few tiers/distinctions within tier 1 to be clear
The best: the largest/most tenured/most PnL-generative teams at C/M/P/B. There simply are not teams at the Holocene/Candlestick/Junto/Steadfast type funds (funds in between pod and SM) that are capable of consistently generating $150m+ every year. There are a handful at the big 4 MMs. These are great places to be analysts as (1). there’s a history of analysts managing larger sub-books, (2). They tend to have incredible processes given how long they’ve lasted and the success they’ve had and are great learning grounds, (3). These PMs have better economics with the firm - if they’re generous and know how to properly retain talent, odds are your payout will be higher as an analyst than on a less tenured team.
there are some very, very smart PMs at the Holocene Candlestick Junto Steadfast etc type funds. Can even throw Viking in there, though I’d probably put them in the best tier above. These are also awesome seats
The remaining teams at C/M/P/B
Out of curiosity: how many pods do you think qualify for that criteria? In a given year, how many teams make 150mm? 300? 500?
What are some of the other top names that would fall within the in-between pod and SM group? Assuming all MM spinouts like Alyeska, Symmetry, Woodline, and Ilex probably fall within this category, but am curious about a place like Coatue that hires from some of the in-between shops and even sends alum to the pods? Also curious about Viking spin-outs like Anomaly (I know D1 is definitely staunchly a SM haha). Looking to make the switch over to the top two categories mentioned above.
You will get paid well at the junior level by D1 and Coatue but they are not sustainable senior analyst seats due to churn-adjusted P&L payout framework. You will be paid less at the junior level at the pod-style SMs (Holocene, Junto, Candlestick, Anomaly, Woodline) but at senior analyst level have opportunity to have carve with formulaic payout. However, the payout is nowhere as good as at a real pod where junior comp is awful but training is the best and successful senior level comp is unparalleled.
So you need to optimize based on whether you are a junior wanting to build up some savings or a senior who is confident in coverage profitability. Base it on what you are looking for.
how do u vet PMs / understand what tier they are in? are you able to ask for PnL #'s ?
The above are great frameworks. Also remember that there’s selection bias for the seats you will see - you are more likely to be shown worse seats by BD given there are less openings on the great teams at any given time.
I joined a top MM with a seasoned vet PM (at the time this felt like it checked all the boxes). Now two years later we just got blown out. Looking back I should have seen the turnover on my team as a red flag and dug in more to the causes around that
So what did you miss back then?
How are you able to diligence the turnover on a specific team prior to joining?
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