Signed PE offer but laid off?
Hey guys, potentially a dumb question but second year analyst here (ignore title) who was fortunate enough to have signed a PE offer to start after my two years as an analyst. Trouble is, with all the layoffs happening am candidly unsure if I’ll make it the full two years given the current state of the markets. Call it personal bias but don’t think that I’m a poor performer and people have communicated as such, but when push comes to shove I can think of several other analysts at my BB group who “play the game” better and have better connectivity with seniors.
If I’m unfortunate enough to be laid off in the next wave of cuts, will that be a non-starter for my firm even in these particularly trying times? Or, will they understand that this may be a function of the current macro environment? Any chance I could start early maybe? Thoughts?
if you are really worried tell the group head you signed the pe offer and will be gone in 2 years. Good for the bank to save on severance while still squeezing out another headcount.
Wouldn’t that just give them more reason to lay off? Rationale could be “oh he/she’s leaving anyways so might as well lay off” right? Or am I thinking of this wrong
Do banks actually pay severance? I thought at wills contract language meant that they could avoid those
They're able but often still pay severance as a curtesy, often in order to avoid getting potentially sued
In US, people often sue employers, occasionally citing discrimination, when they get fired. Paying a severance is basically an insurance policy against this.
Additionally, it is worth noting that during layoffs, severance packages are less common across the broader US employment market, since in the courts, layoffs usually are considered an "acceptable" way to terminate employment
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Maybe it would be best to work with your future employer on a solution. I have seen people start their PE offers early. If you think that role may be more likely to be a long term fit for you then the banking role, might make sense to start working with them on a solution here. Maybe they would even talk to your bank about helping you stay on longer or something if the Pe firm has a good relationship with them. Either way, good luck and best wishes :)
Thank you!! Super helpful and very much appreciate the help here. The fund I’ll be working at is a bit smaller so less of a relationship there, but it’s generally known to treat their associates well so hopefully they would be willing to work with me in the event of a layoff. Current bank im at is pretty much the opposite so doubt they’ll be willing to make any sort of special considerations unfortunately…
First, read the contract that you signed with the PE firm. Maybe your getting lay-off can allow the PE to rescind the contract. Maybe it doesn’t.
Second, if the PE shop you are going is a client, I’m sure it’s in the best interest of your firm to keep you there. It’s always good to have a friend over there, even if at the junior level.
Third, if you actually get laid off, then talk to your future employer. Maybe you can start early.
Thanks for the insight — unfortunately contract doesn’t state anything specific there as was pretty bare bones. I guess starting early would be a best case scenario here
Could you elaborate on your second point? How would one analyst make a difference for a long-standing relationship between a bank and a PE shop?
Nothing improper, but you can feed them intel. Asset A is a winner, you should stay close to it. Asset B has many banks covering already, don’t waste time.
That sort of thing is valuable.
Bumping this topic in light of expected layoffs coming this week
Anecdotally speaking, a friend of a friend was fired several years ago (allegedly because their firm found out they had signed a PE offer), and they were allowed to start their PE gig at a MF early. Hearsay so I'm not sure of exact details and obviously not the same situation here, but it's at least some consolation that these decisions are highly circumstantial + someone else was given grace in their situation.
Especially if the shop you're joining is smaller, I'd be hopeful that in the event of a layoff they'd be more understanding. Ideally this doesn't happen to begin with, but if it does, you say you're a decent performer - line up references from your associates/VPs/MDs and that should help.
This is helpful, thank you for sharing! Firm I’m going to is growing rapidly (~8 people in most recent Associate class across all verticals) but very much still a MM / UMM in GE. Worried that the industry focus and recent growth might make them less receptive to having people join early as if anything would imagine they want to take in less new associates in coming years. Seems like a waiting game for now
in a similar boat. how about if you’re currently in the final round of a PE interview process?
Would imagine if you get the offer you should likely disclose it ? But also unsure so curious what others think
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