2024 PE BD Comp Thread
Have seen this on here for execution and IR, but do we have enough BD pros to compare comp notes? Given it’s a small world, feel free to use ranges for fund size, city, etc. to anonymize a bit. Most of us probably know each other.
- Fund size: $3-5bn
- Geography: NY/LA/SF
- Seniority: VP1
- Banker coverage or proprietary: 100% coverage
- Comp structure: base and discretionary bonus
- Base: 225k, bonus: 410k (bit of an outlier; expecting closer to 525k all-in this year)
Curious if there are any principal/md/partner level data points here?
Based on the most helpful WSO content, while there isn't specific data in the knowledge base for Private Equity Business Development (BD) roles at the Principal/MD/Partner level, here are some relevant insights:
VP-Level Compensation: For a VP1 in BD at a $3-5bn fund, the example provided aligns with a base of $225k and a discretionary bonus of $410k, totaling around $525k all-in. This is consistent with high-end VP compensation figures in private equity.
Principal/MD/Partner Compensation: While BD-specific data isn't explicitly detailed, general private equity compensation for senior roles like Principal and MD can provide a benchmark:
Geography and Fund Size Impact: Compensation tends to be higher in major financial hubs like NY, LA, and SF, especially for larger funds ($3-5bn and above).
If you're looking for more granular BD-specific data, engaging with peers in similar roles or leveraging WSO's networking resources might help fill in the gaps.
Sources: Private equity comp in London?, 2017 Private Equity Report – 8 Category Highlights, London Private Credit Compensation 2022, https://www.wallstreetoasis.com/forums/compensation-differential-nyclondon?customgpt=1, London Private Credit Compensation 2022
Thank you for regurgitating my own post back to me Monkey Bot, very cool!
How long have you been in BD and what is your background?
Not in this space but how does this even work? Wouldn’t bankers and management teams want to speak with the deal team / decision makers? Quite interesting set up
Given you said NYC / LA / SF I presume you’re in LA since it isn’t really the same as NYC / SF.
Regardless, $635K for a VP1 is pretty damn good, no? What are your hours like? Tons of compensation upside still to be had.
Did you just post this to flex? That's pretty crazy comp at that level / function, especially for 100% banker coverage
I posted it because the original purpose of this website was to share information about financial careers, including comp data points. I’m only close enough with a few other BD pros to actually talk numbers (which are comparable to mine so not sure how it’s a “flex”) so was hoping to hear from others, especially more senior.
Not being a dick but what would you say is value add? More streamlined sourcing and air traffic control? Can't imagine it's that hard to get banks to show you deals if you have capital.
Nah it’s a fair question, especially since I didn’t realize how opaque this all seems to people on the execution side. What you noted is a part of it: partners get so tied up on execution and portcos that they can’t possibly cover their entire relevant universe and effectively field inbounds - they will inevitably miss a deal that’s actionable, and that loses out on way more money for everyone in the long run.
Travel is another part of it. I travel less than most BD pros (am on the road 1-3x/mo) which you can imagine doesn’t mesh nicely with execution/portco travel. Partners will have conflicts all the time that prevent them from making relevant events/conferences. And when it comes to being outward facing at things like this, you also want charismatic people with strong social skills because, not to be a dick myself here, there are a ton of fucking dorks in this industry.
I also provide unique informational advantages to the team because I am constantly having these conversations. I can tell them who paid what for any given asset and what’s coming to market and when, what’s a total shitco and where we should actually spend time. To touch on your other point, sure a bank will show you whatever as long as you have capital… and are willing to pay 12x for it. Part of the reason why so many people are fucked now and we aren’t is because we don’t overpay, part of which comes down to this market insight. Certainly not saying it’s all me (and it definitely is not; my current colleagues are the smartest people I’ve ever worked with), but it does move the needle.
Forgot one other extremely important point: I obviously do not call the shots here lol, but I do have a voice at the table come exit planning time when we decide who gets to pitch and who ultimately gets selected. Take that however you will.
I know there are firms that do the sourcing and effectively pass off to books of PE clientele, but I’m assuming you are sourcing and investing, is that right? Is the typical path to enter this also via the more traditional 2 year IB + 2 year PE?
I’m dedicated to sourcing, by covering banks/bankers, at a PE fund. I do initially screen deals, stick on through some DD calls, and will attend MPs occasionally, but post MP and LOI I rarely get involved. There isn’t really a typical background; you’ll see a mix of people from banking, investing, or there are some people who come from sales roles. Depends on the firm’s investment style/mandate and how they approach sourcing.
Which large PE firms have these dedicated Bd / sourcing gigs? I know KKR London has a separation between deal and sourcing, but that‘s about it.
Dude is making more than VPs on execution teams in the MM - based on my own firm & colleagues in the space, this comp is quite a bit above market (or at the very least top 5% in the space)
Lmao 635k is more than vp1 are many umm/mf too
To be fair, I did note that I expect it to normalize around 525 this yr.
Does your bonus # include some type of sourcing incentives in there - e.g. $100k per closed deal sourced?
No - purely discretionary, though it was higher this year due to being directly responsible for sourcing a platform. I have heard of folks in the past at other firms with those types of incentive structures tied to number of deals or equity deployed having monster years (>1mm) but idk if that happens anymore.
Bump
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