PCA is paradise
7.45
It’s Thursday and you are the first one to wake up in your four-bedroom flatshare. At least one of your flatmates has been burning midnight oil for the past 2 weeks and you’d be surprised if he showed up to the office before 10am today. You haven’t seen the other two in weeks, though you could’ve sworn that you heard whimpering through the closed bedroom door last night.
“That’s what you get when you sell an undifferentiated product”, you catch yourself thinking. How lucky you were to have come across Secondaries in your final year of university – who needs to spend weeks over weeks, crunching through longlists, building merger models, or, heaven-forbid, build a DCF model. (Un)levered beta, purchase price allocation, debt covenants – these are topics that used to keep you up at night.
Now they are but distant memories.
9.00
You arrive at the office – you are the first one, and will be alone until 9.30am, when the intern arrives. “Good cultural fit”, you think.
You refocus your attention to the step-by-step LBO tutorial on YouTube that your friend in M&A recommended. While you haven’t actually opened Excel since last quarter, the man on the screen makes it seem simple enough – crank out a few of those and you’ll dominate PE recruiting in no time! Now you just have to wait for the Dartmouth and KEA recruiters to get back to your cold emails….
Must be a tough recruiting market.
10.30
You check your LinkedIn and decide to ignore the head-hunter reaching out with an IR opportunity at a LMM growth fund based in Eastern Europe.
You scoff – this is the third one this week. Don’t they know that you understand financial sponsors, and by extension private equity, better than almost anyone else on the sell side? In your mind it’s EQT or nothing!
11.30
Team meeting – the MD proposes to be more aggressive on marketing.
“Every LP and their mother needs liquidity – and who but us to help them unlock it! After all, DPI is the new IRR.”
He throws around terms like tender, staple, structured solutions, collateralisations and you can feel yourself zoning out. “Let me get back to my LBOs”, you think.
You catch a glimpse of your co-analyst who is cowering in the corner of the boardroom, and who hasn’t said a word all day – he has been stuck in the office since Monday, redacting identifying information from LPAs and fund quarterly reports for the 250-line, $65m NAV portfolio sale that he is staffed on. This is the fourth deal he had to do this for this quarter. You are convinced that he has spoken to the Intralinks sales rep more often than he has to his mother.
“At least it’s a good way to get reps in”, you think to yourself.
12.15
You’re getting hungry. Some of your team members are grabbing lunch with a client, so you are left to scour the rest of the floor looking for some company
Everyone you ask is busy.
“Tryhards”, you think.
12.35am
On your way to lunch you receive a call.
“Hello?”
“It’s x from Brock & Decker...“
You ask him if he for once has a mandate for the positions he is pitching you. What follows next is what you can only assume to be verbal abuse. You don’t understand a thing – the recruiter is shouting at you in Latvian.
You hang up and block the number.
13.30 – 16.00
Post lunch, you have your only productive couple of hours of the day. You whizz through an Information Memorandum you are preparing for an upcoming continuation vehicle transaction. The equity story is tight, the investment highlights generic, GP alignment is questionable at best. Returns? Who cares. It’s a visual masterpiece, with a level of stylistic consistency that would make Caravaggio proud. Digital chiaroscuro.
16.15
Your triumphant march through the IM comes to an abrupt halt when you notice that the section on valuation hasn’t been touched by your M&A colleagues. “Useless sector bankers – how long could a SOTP possibly take?”, you mutter.
You send a message to the junior staffed on the valuation pages and immediately mute your Teams – you are not available to discuss this. After all, you work on the structuring side of the transaction.
16.30
You grab coffee with a friend on the secondary buyside. Selfishly, you try to get some tips on LBO modelling out of him. He laughs and says they are focused on getting discounts and only project top-line. You blank.
He explains and says that their IC currently sees buyout exposure trading at a 15-20% discount to NAV, no matter the underlying. You’re confused, given the company you are trying to sell at the moment is growing at 25% organically and outperforms peers by 7ppts on an EBITDA margin basis.
“We like to stay high level – the market is too busy right now for us to lean into nitty gritty stuff. We like value on the buy”
You learn that their IC consists of two ex-Cogent guys, one ex-Deloitte forensic auditor and one guy who’s been doing nothing but buy LP portfolios for the past 28 years. They just closed on a $10bn+ fund and your friend has closed 9 transactions this year.
You get back to the office and start googling
“Biggest secondary funds currently hiring”
“Blackstone SP AuM per investment professional”
“How to build fund waterfall models from scratch”
“Types of fund financing facilities”
17.15
You go to the kitchen to grab a smoothie – no coffee, you want to be in bed by 10.30pm today.
One of your classmates (Consumer M&A) notices you. “Going home already?”
You try to ignore the comment. You have at least two more hours of work to do, you don’t need any more distractions.
As you walk past your desk your VP calls out to you. “Nice work on the IM colour scheme! Looks sick.”
You nod – still got it.
18.30
You order dinner. Not that you have to, but you like to expense them to feel like a real banker. You open your Outlook for the first time in 3 hours.
5 unread messages.
RE: Project Titanium – nonbinding offers
New GP-led market entrant – JAMMBO No. 5
Secondaries Investor – Are GP-leds basically a pyramid scheme?
CAN ANYONE TELL ME WHERE CINVEN HOL…[press to read more]
IM Catch-up – Numbers don’t tie, call me ASAP!!
You relax. Nothing that you couldn’t do tomorrow.
20.00
After a brief journey on the Victoria line, you get home – you are the first one home, as always.
Even after 4 workdays you feel as fresh as a spring chicken.
You start watching football, while you half-heartedly respond to the occasional email.
“Attached a mark-up on the IM pages – can wait until tomorrow”
“Market intel – CalPERS are shopping a EUR 3bn LP portfolio”
“Recruiting catch-up (Oxford candidate)”
In the background, Real Madrid seem to be winning. They are always winning.
You get your phone and set an alarm for the next morning – 10 hours of sleep, again.
You smile. Liquidity solutions for institutional investors are paradise.
PCA is paradise.
getting into bx sp outside of their UG program is fuckin impossible, i feel the pain of finding exits outside of secondaries lmao
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This is fucking accurate
GP-leds are kind of a Ponzi scheme - you’re literally bringing in new investor money to pay off old investors’ stakes in assets that are marked criminally above what they could sell for. Did a year in PCA and was mind blown.
Alright buddy, by that logic every sponsor to sponsor trade is a Ponzi scheme then
Kinda true no? Always wondered how LPs felt when the GPs they committed to traded assets amongst each other. Like you get a capital call in the morning and then capital distribution in the afternoon...... only after taking a 20% haircut
“Mom, how did we get so rich”
“Your father invented continuation vehicles to find exit liquidity for trillions of dollars worth of unsellable assets. Eat your cheerios”
How is PCA / GP-leds doing in this macro environment?
Serious question- thoughts on placement agents like Campbell Lutyens?
OP seems to work at Evercore? - Either way top drawer content
No way EVR PCA works only until 6:30pm if it’s true it does seem like paradise
My friend who works EVR PCA grinds
..
This ain’t about Evercore pca that’s fs
Guys, it's not Evercore - must be Lazard. Source: know few friends that work there. Keep grinding Evercore PCA though!
“Only project top line”
As a buy side secondaries analyst… guilty
Sounds like Lazard lol
All comments seems to point to Lazard - but isn't Lazard one of the top tier sweatiest shops?
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