With the exception of starting your own business/company, are there any career paths that will lead to a 5-10MM+ all in comp? Are partners at MFs (not the global heads) but just regular partners/senior partners at MF PE firms able to reach this level of earnings? What about PMs at top hedge funds? MDs in banking? Or are there any other career paths that will lead to this kind of payout?
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You won't last in the industry if you're only in it for the money
While this is true I don't think pe associates are working 90 hours for fun
PE associates don’t work 90 hrs on average, most bankers (even analysts) don’t average 90 hrs on average
At PE (assuming a MM) probably average 65-70 hours
Yes, I don't think you realize how much $10 million per year is, and how few people in this world make that. It's obviously doable... but if your goal is to make 10 million bucks a year, you'll most likely never reach it.
If your goal is to be find something that you like, work hard to get great at it and become super-knowledgeable about it, you'll also most likely never make $10 million a year... but you'll have a better shot at doing so.
What about $5 million? I'm just wondering what the numbers are for those who are at the top. Partners at big law can earn within the 5-10 MM range, often closer to the latter. I'm just wondering what the numbers look like for the MDs/PMs/Partners at IB EB/BB, HFs, and PE MFs respectively.
If there were any straight forward and simple career path to do this, all the type A doctors, lawyers, and bankers that are just in it for the money would have done it instead, which should tell you all you need to know about whether there’s a path like this or not.
This topic gets asked every SINGLE WEEK without fail. The short answer is entrepreneurship, its too bad that everyone is too chicken for the 90 percent failure rate and giving up hundreds in thousands in opportunity costs for such an uncertain and risky outcome.
There are very, very few people that get paid >$5m a year from a job. For reference, only ~1k CEOs make more than that figure in total comp across the entire US.
In finance, for an employed individual, you're really only talking about a couple of groups:
Leadership (including group heads, divisional heads, C-suite etc) at major firms of all varieties including Goldman's PMDs
Partners in a well performing $1bn+ single manager HF
PMs running 750mm-1bn+ pods at multi-manager firms and performing well
Partners at well performing private capital firms with large recent funds or Partners in early stage VC firms with amply sized recent funds posting breakout returns (>3-5x)
PMs running well performing, large, expensive (>0.5% fee) funds at traditional asset management firms
So, again, pretty minute universe of people. The ceiling for most employed folks in finance is probably low seven figures annually. Even then, getting to that ceiling is by no means a piece of cake.
A ton of people who start out in finance but either don't crack P&L attributed roles in HFs/AMs or move to corporate after either deciding against staying til or were unsuccessful in reaching Partner / MD in private capital or IB are probably capped out in the mid six figure range. There's a whole cascade of outcomes with very few people sitting atop the $5m+ mark.
Of course the calculus of all of this changes when you consider entrepreneurs. Be they of a traditional business, a financial firm or fund, a venture backed startup etc. The first two are more likely to yield profit distributions whereas the last is more likely to yield outsized asset growth.
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