I'm in an interesting situation and I was hoping that some of you WSO members could lend me a hand.
In Summer 2017 I interned at a small PE fund (three employees, $100M fund at the time) after sophomore year. I really enjoyed my time, but due to the fact that I wasn't graduating for two years I re-recruited and landed an SA gig at in IB in SF. I enjoyed my time there and ultimately signed a return offer before returning to school for senior year.
However, just last week my boss from the small PE fund called me and asked me to come work for him after I graduate. He said that he is in the process of raising $200M and that I will be his right hand man throughout the process. I would be building investment theses, sourcing deals, and conducting diligence. He said that I will have the chance to invest alongside the fund and get carry. Additionally, he mentioned that promotion opportunities are available.
I'm really not sure what to do about this situation. It feels like IB is the safer path as I could re-recruit for PE after two years, but working at this PE fund could allow me to get in on the ground floor of a firm with great growth opportunities and autonomy. Additionally, the chance to get some skin in the game early through investments with the fund and carry is very appealing.
Additionally, what questions should I ask my old boss as I make this decision? It's a huge turning point in my life and I want to make sure I am fully informed before making a final choice.
Am I crazy for even considering this? Please let me know. Thank you.
I commend you for thinking about this so maturely as a 21/22 year old. You've outlined all the major pros and cons. I think banking for a year gives you some option value - a "big" name on the resume and a wider network - all benefits wherever your path goes in the future. That said, all my connections who are doing the best in PE now got in early at funds that grew rapidly. I'd personally do the 1 year at the bank as well. But I'd grab lunch or swing by the old boss' office and make clear your interest in joining after a year. You could frame it as the BB providing free training, more able to hit the ground running after a year in banking, etc etc.
If you join and the fund flames out, you are completely okay assuming they had capital and were doing a bunch of deals. You would be way too junior to have bad deals stain your track record. But you'd have a ton of "what not to do" deal experience which any PE fund would value for a mid level hire.
He will certainly not appreciate the fact you're coming back once it's derisked for you. Expect way less opportunity to be thrown your way if you do this. I've had people do this to us and it doesn't count in their favor.