Is the difference in pay that much between big funds like (KKR Credit, Ares Credit, HIG Credit, etc.) and smaller funds (Maranon, deerpath, etc.)? Any insight would be appreciated.
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Coming from a smaller fund, yes lol. Also depends on strategy (senior only vs. 2L, mezz, equity coinvest, etc.)
Is the difference drastic? Which strategies tend to pay more? Also, how small is your fund compared to something like Maranon? I really appreciate the help.
My firm is probably a bit smaller than Maranon, but I have heard Maranon underpays too.
Sorry just realize I didn’t fully answer your question. Senior only shops often pay less because their returns are lower. Maranon is a growing firm that can invest deeper in the capital stack and typically recruits from banking, but I have still heard they underpay. Trade-off for less pay could be getting more responsibilities or opportunities earlier on.. I’ve worked with them on deals in the past and they let their associates run with stuff that other firms wouldn’t let associates touch. Not sure why Antares underpays so much, they are very competitive in the market and close a ton of deals, but don’t recruit from banking as much so maybe don’t have to pay that premium. NXT / Twin Brook are examples of other places that recruit from outside banking so underpay. Honestly private credit comp is a bit of a black hole. I’ve seen first year associate comp go anywhere from $150k to $230k, but the latter is gonna be at a place like Ares.
Lower returns (and hence management fee) certainly is a factor, however, credit is really an AUM game, which is why larger shops can pay very well. From what I know, top funds pay more than $230k to ASO1s.
Examples of stuff Maranon associates do that other associates dont?
This is exactly right. I am closely acquainted with Maranon (former roommate was at Maranon) and have heard Associates there take tremendous responsibility - leading creation of all IC memos and leading IC discussions, leading diligence calls, running with the entirety of the model, large role in legal documentation and negotiation, leading management / lender meeting discussions, etc. Also, their deal teams are 2-3 people so as you can imagine there is a lot of responsibility that makes for a very good learning experience.
Sounds like they are growing rapidly and have the flexibility to invest across the capital structure as well. It's an excellent shop to go to in terms of getting an education as they touch so many different parts of a deal and process. Pay is not there with UMM and MF credit arms just given their size, but if you're looking for an education and want to learn as much as possible you'd go to Maranon vs. Ares or KKR Credit. However, I've heard through the grapevine exits coming out of Maranon have been very good just given the responsibility and education their Associates get.
Depends. Way too many variables.
Two of the "bigger" funds you listed aren't even what I would describe as bigger... But yes I think there is a pretty wide range in both PE and PC funds based off fund size and other factors.
Antares is massive and pays like $5
Bump
In all seriousness it’s the ratio of investment professionals to capital. Less IPs = higher pay. Know of several firms that manage something like 1-5 billion per associate and obviously those guys get paid quite well
Do associates typically get allocated carry at smaller funds?
Not from my experience. Usually will see it at the VP level or Principal.
Bump - any info on Ares?
Bumping
You typically see higher comp at credit arms of large PE funds to keep parity between investment teams. Pure credit investors tend to pay at a larger discount.
What is market Associate base/bonus in NYC these days?
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