Fund Placement Advisory

Placement agents help PE/Hedge Funds raise capital. Usually they are very well connected, and have a wide network of potential LP investors. They work to find LP's that are interested in the fund's strategy. They coordinate roadshows, help with pitch materials, etc.

Usually the placement agent will take a 2% fee on any capital they raise (if they raise $1B for a fund, they collect a cool $20mil).

I do not know exactly what people in these firms typically make, but I believe a large number of them are ex-bankers so I assume they get paid relatively well.

Thanks Billy Ray - do you know what junior people do at these places? I know they run pretty lean, but looking to see what someone on the analyst/associate level would be doing.

also, how are the hours? significantly better than banking?

Interned at one of these. PM me for details.

Juniors make marketing related stuff - its pretty boring sht

All you do is help market a fund or build it up so you do marketing materials and prospectuses and all kinds of powerpointy-stuff

You end up making a lot of marketing marterial as a junior person. The only hectic time is when you are about to start a fundraising initiative because you need to make the Private Placement Memo, Investor Presentations, a fund model (usually pretty simple, but can be more complex or specific if the fund already has an acquisition pipeline that you can factor in), creating a target investor list etc. Once that is done, as a junior you are basically waiting for senior guys to give you updates on investor responses and you track it in some sort of matrix, which is why teams are top heavy. It usually take 6-12 months for the whole process which is considerably longer than equity raising for an IPO or the length of a M&A deal.

Fund Placement Advisory is NOT private capital markets ... private capital markets is more interesting

THanks guys - I'm getting that it's more of a sales/marketing role essentially.

At the junior level is there any room to move up directly? How are the hours are the junior level?

I currently work in M&A - realizing it's not for me, but I would like to stay in finance. PE/HF would be cool, but I don't think I would put up with M&A long enough to make that jump, and quite frankly, there is nothing driving me crazy to do PE.

Maybe I'm just realizing that I'm not that type A, but banking is not for me, and I'd rather something a bit more laid back.

I should say - I guess I really enjoy the client facing side of banking, or the sales-ish type of role. When I was looking at banking, I strongly considered trying to join a sales desk as well.

I could tough out banking I think, but I'm not sure the skillset is all that necessary for my end goal at this point.

A-A promotion at Lazard Private Fund Advisory is not available. They ask all the analysts to go back to business school after their 2-year program. This is as of 2007. Not sure if things have actually changed since then.

Just wondering - is it even worth it to do an internship at a HF/PE capital raising place (no-name, NOT Laz/GH) as a freshman if I want to go into S&T later on? Thanks.

As a freshmen take what you can get. Junior, no.

Fund placement is actually a highly desirable job at the senior levels and extremely hard to break into. Senior professionals at these firms typically come from investment banking, FoFs or private equity and it is VERY rare to see someone who started as an Analyst or Associate make it to VP. If you have spent 7-8 years in banking and have an opportunity to join a good placement agent as a VP, I would take it. These guys make a ton of money and work less than 60 hours per week (half of which is spent at lunches, dinners, and the golf course). The type of personality these positions attract are very type A, enjoy sales, yet have the technical backgrounds required to source and distribute private equity funds. Pay is roughly equivalent to investment banking (~25% lower bonus) at each level; however, if you are on the distribution side, the comp is highly commission based. I know that there are certain MD-level placement agents at the top firms who make $10 million per year, although this is the exception not the rule. As a reference point, I started my career as an Analyst at a top placement agent (not recommended) before going back to business school.

I've recently been turned onto the private fund advisory side of IB and would love some insight from anyone with some exposure / experience to the groups. I know the lack of quantitative analysis deters a majority of this forum, but for my personality and interests long-term it makes a ton of sense. Can anyone shed some light? Feel free to PM if you'd like. Thanks!