Ideal "Best Case" Compensation Career Path
Hi Monkeys,
I've been lurking on this forum for quite a while now, and wanted to ask a couple questions to some of the more veteran monkeys around here. I'm an incoming student to a semi-target in Canada, and I was wondering what the ideal path for maximum career earnings would be. I know the typical route (not including exceptions like starting your own fund/entrepreneurship) is going through an investment banking stint, exiting into MF PE/HF, and eventually doing your MBA (if you went into PE) but despite searching on the forums, I wasn't able to find any posts talking about their experience on what happens after this. Assuming you want to maximize earnings, is the best-case scenario to go back to your MF and climb the ladder? Or is PE or some other field more lucrative?
People either slave away back to PE after MBA or they go off and do something entirely different (e.g., industry), which is hard to map out given the huge variety of choices. There's no one way to maximize career earnings.
HF out of undergrad, hop over to better funds periodically
the best thing to do after an MBA (with a IB and PE stint before) is whatever you actually want to do and excel at. Some people go back to PE and grind it out and try to climb the ladder. Lots go into industry (tech especially seems to be the hot thing for MBAs). You can go into public markets (hedge funds, mutual funds). VC is also pretty trendy.
You can make a butt load of money in any of those fields if you are successful. Debating whether you will make more money in PE, VC, or HFs is asinine because a top dog in any of those rakes it in. The important question is which of these fields you are most interested in and have the best chance of success pursuing- it doesn't matter if hedge fund managers make 10% more money than VC MDs if you get fired from the hedge fund because you aren't good at public markets. Post MBA isn't really about what offers the most short term comp or the best exit ops- it's about finding the industry you want to build a career in.
Thank you so much for the elaborate reply (not just you, but to everyone who commented so far as well). To be frank, given my previous lurking on other similar posts, I was expecting a lot of troll answers (since I'm still an incoming freshman to a semi-target that's not even an American school and others may perceive me as overly keen since there's a high chance I won't even be able to break into IB), but all of these responses were genuinely insightful and helpful. Thanks :)
This doesn't exactly answer your question, but I wouldn't be so set on the IB-->PE-->MBA path to begin with. Getting an MBA is a huge cost both in terms of tuition and foregone income. It's not as necessary/common in the industry now too.
There have been some threads on PE vs. IB comp. long-term recently as well, which might be helpful. I'm not convinced that going into IB after undergrad, crushing it and achieving MD promote by early 30's, then deciding whether to stay in IB or switching to PE at a senior position with carry isn't the best career for risk-adjusted returns.
Yeah, I understand that the opportunity cost of an MBA is really high, but it's also always been a dream of mine to attend a top-tier ivy. Obviously it may not necessarily be optimal to max out earnings, but the prestige of an ivy and legacy status for any potential future children is something that would be very important to me. Of course, as a Canadian that's not even attending a target school, this is just a pipe dream of mine and I know that the chances I even break into the first step is extremely slim. I'm just trying to capitalize and least find a direction that I want to commit towards before starting university :)
"There have been some threads on PE vs. IB comp. long-term recently as well, which might be helpful. I'm not convinced that going into IB after undergrad, crushing it and achieving MD promote by early 30's, then deciding whether to stay in IB or switching to PE as a partner with carry isn't the best career for risk-adjusted returns." -- Also, I don't quite understand what you mean by this. Do you mind explaining what you mean by the best career for risk-adjusted returns? Are you saying that IB MDs by early 30's exiting as a partner into PE funds is also an option? Apologies if I misinterpreted, but all of my knowledge on high finance careers is just from browsing around on WSO.
entrepreneurship
Best case rockstar senior MF PE Partner probably caps out at about 25/30m/year assuming you made the climb and weren't there for the early stages. Good luck getting there though.
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