Are There Any Good Funds to Be a VP At?
I'm not going to be the first to say that the carry proposition is looking a bit sketchy industry-wide given the hard promotion cycles and pressure on returns in a now-mature industry, but I realized the other day that it's very hard to name even individual funds that aren't flooded with midlevels already. Everyone knows the MFs are suboptimal for career earnings, but even the Genstars and Coalesces feel like they're...not even close to being lean anymore? What are actual funds in the $800MM-5BN (yes, comically widerange) that you'd actually want to be a VP at?
Note: this is a different question than the "up and coming" fund discussion, because some of the hottest funds also have some of the biggest midlevel logjams.. Obviously, some funds can be both (I see Arcline is pretty leanly staffed even with a bit of an expansion recently, for example).
Pentagon
Idk if you would survive (nor would I want to go) but Veritas is pretty lean I think so you would make $
Having Genstar followed by Coalesce is wild stuff given one is one of the largest UMMs and one is one Fund I with like no DPI
OP: I mean sure, but the comparison was that they’re both “hot” / talked about as career-track places, not that they’re similar in all respects. Veritas is different than New Mountain is different than KPS is different than Aphias, too
No one still talks about Coalesce being hot though. They are bleeding senior folk and have not much to show for their fund yet. It just got hyped up early because Stephanie was a great investor at WP
What does cash comp look like for VPs at Veritas? Know that associate is top of street and north of 400
If MFs pay 600, does veritas get to 700-800?
Among the larger names in your fund size range, think most of the younger funds are less bloated at the mid-levels just based on linkedin than some of the older funds in that 4-5bn fund size range (comparing to a THL or Charlesbank):
Arcline, 26N and Haveli seem to have fewer mid-levels to some of their fund size peers, could just be a case of older ~5bn fund size funds being significantly overstaffed at the mid-levels. Arcline and Haveli have some doubts on performance though. Arcline having some duds in their portfolio, which has been heavily covered on WSO. Haveli is software-only so unsure how their investments holds up to the recent developments in software. As for 26North, the downside is you have to survive the culture there.
All the funds you listed are staffed at the mid levels by now. They are less bloated in their mid levels because they haven't had the time to become bloated at the mid-level. Time will tell how performance will look like for all of them, but all three are very much top up and coming funds. For what it's worth, anecdotally have heard 26N is Apollo 2.0 culture and WLB wise. Haveli is led by the former Vista co-founder and Arcline was founded by ex-Golden Gate, so wouldn't imagine those are easy places to work either.
You’re saying Arcline + Coalesce + Genstar are staffed at the mid level??
what's bad about the culture at 26N?
It's led by Josh Harris. Tons of stories on in WSO if you use the search function, but he was the worst culture person at Apollo, which is saying a lot since Apollo is known for being the most grindy firm in PE. Anecdotally from people I know at 26N, that has carried through. Great career track role with them trying to promote people up the ranks. 26N has raised 4.3bn already for the first fund, which would make it the second largest first time fund raise ever. So great momentum firm to be at as well.
Realistically the best options might be LMM funds with sub-$1B fund sizes. Aka groups that people don't know well on this forum. And even there, you'll be sacrificing cash comp for a better theoretical pathway.
Honestly the more time I spend in this industry the more I realise it comes down to picking your poison. Always seems to be a trade off between culture, fund performance, promotion, comp and deal experience. Especially in this deal environment it feels like almost every place is a dud
Fully agree, I keep reading of these unicorn MM/LMM places where the WLB is great, pay is good and performance is great but can’t think of a single actual firm being listed
There are 4,000-5,500 private equity firms in the U.S. alone... the answers likely aren't in your head.
Isn't that life as a whole? Everything has trade-offs, but probably best to be at a growing firm with good performance. PE hours are always going to be rough anyways, so would rather optimize for long-term comp which is pretty much going to be based on fund size, fund performance, and promotion chances.
For sure, knowing it is one thing. Experiencing it play out is another!
Thoughts on 1-2B fund with 2 midlevels (principals + VPs)? Assuming things have been top quartile. Thoughts on coming in as a VP/principal here? What sort of comp to expect cash/carry, any potential red flags?
Seems like a good seat but also depends on the seniors. If there are like 5 partners in their late 30s you probably have a while to go.
Good point. But if your vertical (eg financial services) only has one sector head at $2B fund size, wouldn't you underwrite adding another sector partner if you double fund size?
What $1-3B growing MM funds are there in NY?
Would look at Valor Equity, Reverence, Lead Edge and Bregal if any interest in tech. Outside NYC would look at JMI (Baltimore), Turn/River (SF), Silversmith (Boston), and Serent (SF).
Bregal PE has wound down. I don’t think the return for bregal tech have been great
Skyknight raised a new one, think there's a couple others with non NYC HQ but NYC offices that raised as well
Interesting you mentioned SkyKnight because have heard some absolute horror stories. Very political and toxic culture where none of the seniors have any respect for their juniors. Heard screaming is fairly common. From the person I know there, they make it very hard to recruit out and punish people who are "bad leavers". Clearly it's not working though as they have had a huge exodus of investment professionals.
This fund is an absolute joke and they are primarily SF based (actually Burlingame)
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