Is it irresponsible for me to leave PE?
I hate PE and but the money is so good that I feel like I should stay at least for a few years of VP.
I am 30, senior associate, have $3-4mm in the bank. I almost certainly do not have what it takes to make partner because I am bottom to middle bucket, but people like me so I think they'd keep me around the hoop until at least Director/Principal, and maybe through that if I can quickly get in a role where I am driving deal flow rather than executing internally.
I've tried other careers (eg startup, consulting) and only really liked the latter. The problem is the pay is shit once you experience PE. I feel like it would be irresponsible to leave.
I'm making roughly $450 cash next year. The thing that makes it tricky is that maybe my lifetime earnings is better if I commit to being a consultant early or am a key man that helps a startup execute. I am nearly positive I could be a consulting partner - that job is so laughably easy and fairly fun. Whereas I feel like only luck will see me to being partner at a large PE firm.
My question is what you think about all of this.
How in the hell do you already have $3-4 million? I am 30 and have ~$600k and been in banking since undergrad. Wtf am I a terrible saver. Realize pe carry is higher earning potential but jeez
Idiosyncratic circumstances
How?
They probably invest quite a bit of money. Definitely is a lot of money at 30 though.
either struck it incredibly big during COVID or got some help. math literally doesn’t work out any other way even assuming no expenses
A lot of people in this industry have family wealth passed down
..
If you still fundamentally like deals and are personable, try to switch over to the BD side if your firm has that function or join one that does. Better hours, no/minimal weekends, and the pay haircut is not as much as you think (e.g., the cash number you mention is top of market for a BD VP in the MM/UMM).
Thank you. I will look into this. How does this scale as you become senior?
BD is like THE senior skill. Either you bring deals that get executed or there's no reason for a firm to keep you around as an expensive senior.
Do many large funds have a BD arm? Most funds I've seen, including my own large cap / MF, source through their investment partners...
If I had $3-4M at your age I would quit immediately and find something else, especially if, like you said, you're not on partner track. Posted a similar thread about quitting with 1/4 that saved up (with nothing else lined up).
Based on your age and some of the other income facts you laid out, I'm assuming you either have done fantastically investing your income, or have inherited some money as well (or huge carry / co-invest payouts?). Those are other facts that tell me you should not be focused on the comp piece and instead think about how to optimize your life. You may end up doing better $ wise elsewhere if you're not gonna be a PE partner.
OP I know someone who was in a very similar boat to you (definitely became a millionaire in PE). I'm guessing you hit it big in the stock market maybe or had some homerun investments at the firm? The latter seems to be the case for the person I'm thinking of (comes from a middle class family but went to a top school).
He went to the startup world for awhile and now runs his own business with an old college buddy (fintech space). He's around ~35 now and I don't think he's ever been a big spender so he may already be in a FIRE situation but likely had aspirations in the tech space more so than finance (don't know him all that well but that's the sense I got when I saw that / as well some other factors I'm aware of that I won't divulge publicly on here since he or his sibling may lurk here).
Right around your age and have nowhere near $3-4M in the bank. You killed it, congrats. I honestly don't know why you wouldn't leave for consulting given you hate PE and have that much of a cushion, unless you're really trying to fund a fancy lifestyle. Can still make really, really good $ in consulting.
Consulting Partners get paid!!
How you liking the return to PE?
just some thoughts from a "broke" nobody. I make ~10% of your comp, and I cannot fathom making my annual salary on a monthly basis. What I make now is plenty for my current situation, however I'd love to make more!
This seems like using a 144hz screen for years and then forcing yourself back to 60hz. It's horrible at first, but you get used to it.
I think you are overvaluing the importance of compensation. And I'm obviously in an extremely different position than you are (and biased because of it), but I'd imagine non-monetary things play a massive role in your life as well. Appreciate them more!
dude how do you make 45k that cant be real
.
entry level job in LCOL area
Least out of touch investment banking intern
Golden handcuffs
Bruv how is your net worth so high at 30….
I loosely know a couple dozen people that have or have had at least $4mm in the bank by 30 (that wasn’t inherited).
Most of them are professional athletes (surprisingly know quite a few).
The ones that aren’t athletes either did it through crypto or startups.
I know a few guys who probably have $3-4mm of CDAW given they’re VPs in PE, but there’s a difference between paper dollars and having that in the bank.
Most likely his parents put him on. If it was something like a GME stock YOLO or a startup exit he would've just said it instead of being cagey about it.
most probably is from family and generational wealth.. worked the math and it doesn't make any sense that can be achieved through typical ib/pe path. he even said he tried startup and consulting path which means some time is not even spent in ib. if that can be done for majority of pe careers, you won't see a lot of folks still pursuing the dream or working for long past that age anyway...
I would for sure try to get the VP title and grind it out 1-2 more years and then reassess. That way, you'll always have the VP title if you decide to go do something else more casual (will be a lot easier when recruiting) plus a couple more years of great cash pay to stash away.
Lmao dude why are you grinding when you clearly have generational family wealth.
That's what also surprises me when I see them doing IB/PE
totally agreed. the rich guys i know went into IB because their fathers wanted them to see how hard others worked/to get a work ethic/network and they're always out after 2 years or so.
Can you layout why you hate + will not excel in PE or startups and why consulting is preferred? Only then can someone provide useful advice because we don't know what you like / dont like or are good / not good at. Have you considered moving to other investing roles like earlier stage?
With 3-4m in the bank, personally I wouldn't place so much weight on compensation unless you want to be wealthy. I'd focus on enjoying my younger years and cultivating strong relationships with friends / family etc, and honestly semi-retiring (work when I want on what I want) to enjoy life. If you enjoy consulting this is a no brainer but you need to ask how important comp and longer term wealth is to you.
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