I know numbers are pretty standard for banking and PE at the junior levels, but what’s the average/consensus for TC at this level? I assume it varies with carry, but what can one expect?
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30 - LMM VP1, total cash comp $350-$400k, plus about $100k from some co-investments that exited that year (and I wasn't in the carry for)
How are your hours? At a UMM and curious if there is a lifestyle tradeoff to be had for LMM / non Tier 1 city, but know it can be very fund specific
It's unlikely that you'll see any carry payout before age 30. Some firms will only give you carry in the latest fund once you've joined (i.e. you may not get a grant until a year or two in) and in general firms are holding assets longer these days. Add the time it takes to hit the fund hurdle rate -- unless you have an American waterfall which is an edge case -- and it's probably 5-8 years from grant => cash in the bank, assuming the fund even performs well enough.
Djshs
Care to elaborate more?
Care to elaborate more?
Used to work at one of those. That # is wayyyyyyyyyyyyyyyyyyyy too high. Try a third of that. You guys don’t understand how carry works
Quick skim of your comments/posts…your expectations of senior PE/HF comp are extremely wrong. Might wanna take those down a bit
At 30 I was a first-year Senior Associate at a ~$500mm - $1.5B fund. ~$140K salary, another ~$150K bonus.
Second-year SA, received 0.4% carry. Did a lot of deals with variable bonus, made ~$500K.
Thank you for this. Would you be willing to lay out / describe your comp progression a little bit. I am in a very similar boat and would love to know what I might be able to expect.
Here is a real example from a ~5-10bn fund that pays pretty well.
Across 3 years ~$500-750k carry dollars realized. Vast majority on paper. Also have coinvest requirements that significantly exceed realized carry.
This is helpful - what's the vesting period and policy like?
Would you mind explaining coinvest requirements? Did you put in $xx,xxx and are getting$xx,xxx?
Carry vests mostly over 4 years but there is a small tail through 7.
For coinvest, I have a commitment for each fund which is significant relative to cash comp. I think this is a pretty underdiscussed part of PE generally. That commitment was ~$500-700k for the first fund and ~3x that now (I am now in the next role post VP at my firm). I borrow a portion of that via our fund's coinvest line, but that is ~7-8% paper these days so doesn't feel amazing to do that.
The coinvest is "fee free", but it of course operates on the same timeline as individual fund investments which means ~4-5 years on average (and longer right now). Keep in mind that if you keep progressing at a firm, your coinvest commitment will keep growing.
Net of all this is that today despite making ~$1m in cash comp, my post-tax / post co-invest take home looks more like someone who makes a lot less than that. On paper have pretty big sums of carry dollars, but it is a common theme among my colleagues to feel cash constrained (and this dynamic is especially challenging right now given the lack of exits).
holy crap. those are massive step-ups in comp each year. Like My differential is about a 1/4 of that per year unless its a promotion
30. VP3 at a ~$1bn AUM firm. ~$450-500k cash comp and $2-4mm in potential carry.
Edited.
How do you guys feel about $2-4m of carry? Provided you get it in like 10 years - that’s like about extra 300k per year. Just like a very good bonus…
That $300k per year is just based on 1 fund and the gains are taxed at capital gains tax rate instead of ordinary income, making it the equivalent of a much higher number if it were to come in the form of a bonus. Over the course of 10 years you could get an allocation of carry across 3+ funds, with subsequent allocations increasing very significantly.
When I was 26yo I received what would ultimately be an allocation worth close to $6 million vesting over 7 years, I just didn’t know the fund would perform so well at the time. I left for business school but those who stuck around got additional, larger allocations a few years later when the next fund was raised. The key to PE compensation is not a single fund … it’s the fact that you’re raising funds every 3-5 years — hence deployment pace can have a big impact on compensation.
You left $6M on the table for an MBA?! Did the MBA help increase your earnings potential much more than $6M?
Making 450-500k as a senior associate in Canada at 29
MM or pension?
No shot its a pension.
Assuming this is CAD
Yes NY office makes more and in USD
Onex or Brookfield?
Less than you would make in IB. If you start off as an analyst and make MD in your early 30s, you’re making multiple $mm’s. PE people catch up at ~40 and the comp differential widens
Not really a fair comparison. You’re using an investment banker who gets promoted essentially every 2-3 years: 22yo (Ana) >> 24 (Asc) >> 26 (VP) >> 28 (D) >> 30 (MD) and is immediately generating significant revenue for the firm to warrant multi-million dollar paychecks. Then you’re comparing this to a run-of-the-mill PE person.
There are also people making MD at certain PE shops early 30s (31-34) as well fwiw.
An MD in IB has a higher cash comp than PE MDs in the first few years. Once carry starts being realized PE blows IB out of the water on comp.
26 yrs old and still an associate at a MM firm with base comp at ~$300k and carry allocation of ~$800k. Assuming we raise another fund in the next 4 years and I make VP promote, I’ll likely have at least $1-2M on top of that before 30. I try basically think of it as nonexistent and live below my means of my cash comp but it’s nice to dream lol. Definitely don’t say save as much as I used to or should but also not anywhere close to starting a family or kids so I’ve got flexibility. My firm is probably lighter on cash comp for my level but generous carry across the team.
Your BASE is 300k? or do you mean the cash component (inclusive of cash bonus) is 300k?
LMM (JAMMBO) $400mm LCOL
30 -- Snr Ass 2; 315k cash, 600k DAW
31 -- VP2 (direct promote); 400k cash, 1.5mm DAW
32 -- VP3; $475k cash, same DAW (pls god let us have an exit)
Coinvest requirements are 200k cash same in ~7% leverage.
Age 30 varies but let's just assume P1 for simplicity which is a nice career median (so post-promote)
There can be fluctuations but P1 at APO can sometimes be flat with AS4 (SrAs2 at other firms) pay. I think a good range to expect for HVF/PE is roughly 700-900k combined cash/stock. ~75-100k discount in other groups. DAW and points very group dependent
In general would expect APO to pay 100-200k better at jr/mid-level vs UMM at all levels. But that very delta is effectively in stock so it's not as large as it seems especially if you intend to be a career mover & not able to realize those economics
LMM - VP1. ~$500K cash comp (excludes carry and co-investment).
Can you say which city and how your hours are?
good hours, small firm.
Incredible, what region of the U.S.
Ignore title
MF ($15bn+) VP2 - $650k with $7M DAW across two funds (got lucky)
31.. Principal at Growth fund... $875k cash comp + $9-11M DAW
That’s incredible
Congrats! What's the latest fund size, and how many funds do you have carry in?
Carry in 2 funds... but one is very small... peanuts compared to most recent.
Super impressive. Growth can mean a lot of things (VC or PE style profitable growth equity) - is this a large cap / very late stage growth fund?
Overlaps both, but more of the former than latter
Do a little of both, but more former than latter. Somewhat large cap…$2.5BN growth fund
Curious to see some figures on the credit side
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