Megafund PE Rankings: Legacy MFs (APO / BX / KKR / TPG / Carlyle) versus New Age MFs (CD&R / Advent / Thoma / Vista)
MF PE Rankings
While similar in many ways, there are important nuances to joining these platforms. The biggest difference is between the Legacy MFs and the New Age funds, which have grown to rival the historically dominant alts platforms (APO / BX / KKR / TPG / Carlyle). From time in the industry, here are some views on which platforms outperform or underperform on specific dimensions. While the Legacy MFs are still the most desired pre-MBA seats today, the gap between them and the historically UMM funds that have grown into MFs has narrowed significantly. Do you want the industry's most well-known, strongest brand names at a Legacy MF, or are you seeking a more pure-play private equity firm? There's no correct answer, and it's ultimately one of individual preference.
Prestige (Inside of Finance)
- Apollo
- Blackstone
- KKR
- TPG
- H&F
- Thoma Bravo
- Carlyle
- CD&R
- Warburg
- Silver Lake
- CVC
- Advent
- EQT
- Permira
- Vista Equity
- Bain Capital
Prestige (Outside of Finance)
- Blackstone
- Apollo
- KKR
- Carlyle
- TPG
- Bain Capital
- Thoma Bravo
- Silver Lake
Associate Compensation
Top: Apollo, CD&R, H&F, TPG, Warburg
Bottom: Bain, Blackstone, Carlyle, KKR
Post-MBA Compensation
Top: Apollo, CD&R, H&F
Bottom: Blackstone, KKR
Partner Compensation
Top: Apollo, Blackstone, CD&R, KKR, H&F, Thoma Bravo
Bottom: None
Top: Apollo, Blackstone, TPG, H&F, KKR
Chances for Harvard or Stanford MBA:
Top: H&F, TPG, Carlyle, Bain
Bottom: CVC, EQT, Permira, Vista
Getting Promoted
Top: Vista, Thoma Bravo, Apollo
Bottom: H&F, TPG, KKR, CD&R
Culture
Top: Bain, Carlyle, Advent
Bottom: Apollo, TPG, Warburg, H&F
Impressing Your Parents
Top: Apollo, Blackstone, Carlyle, KKR
Bottom: CVC, EQT, Permira
Impressing Your Friends in Tech
Top: Thoma Bravo, Vista, H&F
Bottom: Clearlake, Softbank
Impressing / Finding a Significant Other
Top: Not working every waking hour in MF PE and using your status as a coping mechanism for your lack of a passion outside of finance
Bottom: Working at any megafund
At the pre-MBA level, it's better to go to one of the Legacy MFs, unless you're deadset on doing software at a Thoma or a Vista.
PE recruiting goes fast, so candidates aren't ever deciding between offers from different megafunds. But if they were given the choice, no one would choose some of the lower-tier MFs over a Legacy MF. Yes, CVC just raised a massive fund, but force a shiny new GS analyst to pick between a CVC or Carlyle, and they're taking Carlyle every time.
The value of the well-known brand is the differentiator, because the skillset you develop in your associate years is roughly the same across all these firms.
At the post-MBA level, the considerations change a lot. Across any of these firms, attaining a post-MBA seat is no joke, and being able to move up to the senior ranks from there is nearly impossible. So having the chance to have a long-term career at any of the MFs will lead to a highly lucrative career, however unlikely it is to occur.
I think this is mostly correct. For the associate stint, going to one of the Legacy MFs is the most sure thing for optionality. Whether that means it's the best place for a long-term seat is another story.
The older you get and the longer your career, the more your options dwindle. Even once you go past your senior associate years in PE, it suddenly becomes much harder to pivot into other investing roles like hedge funds or LO strategies. Those doing the 2 + 2 route into a MF are either passionate about investing or type-A competitive types who want to preserve optionality. From a MF, you can choose between lateraling, HF, MBA, portco roles, something more entrepreneurial, or (rarely) staying on at your current firm. A huge list of tradeoffs between those choices, but I don't think you can get a set of options this broad anywhere else after only a few years of work experience.
If they had the choice, would most people take a KKR, TPG, or Blackstone associate gig over a Permira, EQT, or a Vista? Yes. Does it matter? No. At those level of firms, anyone who is in the know is not going to discount you as a candidate for being at a "lower-tier" MF, whatever that means. I'm not sure that you can even tier these funds because of their differences across so many dimensions.
Source: Legacy MF Associate
This isn't even worth discussing. Everyone has their own preferences, and no individual's rankings will be the same as another. There are so many variables at play with firm preferences, and so little control over the recruiting process for candidates.
If someone gets a Permira offer that explodes that day, they are taking it. Is SF their favorite location? Probably not. But let's not pretend that the KKR or BX NYC associate is a world above the Permira associate. There are so few MF positions, and they're split roughly half between NYC and SF, with some scattered in Boston, Austin, Miami, etc.
In the long run, which MF you end up at means absolutely nothing. All that matters is you get one of the MF seats, and hopefully in a group that has reasonable enough people so that you don't burn out of finance entirely.
KKR NYC sent exactly 0 people in their associate class to H/S in the last cycle, and no one was promoted. So was it really a better seat than the person who was promoted straight through at Vista, or the person who got into H/S from CD&R? Hard to tell.
Gun to their head, most people would take KKR NYC over TPG SF. Not a big debate there. But TPG SF just sent half their class to H/S, and KKR NYC sent none. So in the end, the people who went to TPG SF had better outcomes than KKR NYC. Does that mean one group or the other has better candidates, or one is objectively a better seat? Of course not. This is why trying to objectively rank these firms is nonsense.
Gun to their head, most people are taking H&F SF over EQT NY. Talk all you want about NY > SF (which I agree with), but its the truth. But who do you think enjoys their 2 associate years more? H&F is a particularly brutal associate experience, and if you also have a preference for NY, you can see how people don't love their 2 years there. In their head, people know this, and they still choose H&F SF over "lower tier" NY megafunds. Because the Wharton > GS TMT / MS M&A has spent their whole life being "the best", and they feel a different sense of accomplishment for seeing APO / BX / KKR / TPG / H&F / SL on their LinkedIn profile than an CVC / EQT / Permira. But that doesn't mean they made the right decision, or will have a better outcome than any New Age MF associate.
Also, some of these firms do on-cycle recruiting, and some don't. Let's say a star candidate gets an associate offer for Bain Cap in Boston. Are you expecting them to turn it down for a better MF because its in Boston and others may have marginally better exits (which isn't even true), or do they sign on the spot during OC, knowing they just inflected the trajectory of their career?
I'm seeing two major themes in this thread
1. College kids and banking analysts who know absolutely nothing about how this process goes down, who are just repeating things they see on the internet, and think BX / TPG / KKR / Carlyle are the only firms worth an offer. Wait until they go through recruiting and find out how slim their odds are of landing at a MF, even coming from some of the best banking groups on the street.
2. People who landed a Legacy MF offer and are trying to put themselves up at the expense of those who didn't. I'm at one of those Legacy MFs, and there is no intrinsic difference in quality between the associates at any of these incredibly reputable shops.
The same way you have EB > BB shills on these forums, you have those who try to prop up certain UMM / MF firms over the 5 true AUM machines (APO / BX / KKR/ TPG / Carlyle).
Some kid from PJT gets an offer in college, and starts parading WSO about the advantages of being on lean deal teams. Then he gets a MF offer, and most people don't know the name of his firm, so he starts shilling for them on forums.
If you get an offer from GS or MS, you take it. Full stop. The brand name pays dividends for the rest of your career in a way that a PJT or Evercore can't. If you get a Legacy MF offer, you take it. Full stop. Similarly pays dividends that the other less well-known funds can't long term.
The finance skillset is more commoditized than people think. PE is more of a fundraising and LP management job at the highest level than it is truly an investing job. In an industry with undifferentiated skillsets, there's an advantage to pedigree.
Bad take imo
PJT / EVR I view as above GS/MS, and materially so.
But GS/MS probably better if you intend to leave finance
pls explain how PJT / EVR is materially better. Look at the associate classes of the MFs. You will disproportionately see GS and MS across every firm. Other than PJT RX, you almost never see an associate who was formerly PJT M&A as an analyst
Not sure why everyone is liking the prospect's message, this is an awful take. Agreed with SOFRsogood. On average, the ex-PJT / EVR analyst is significantly better than GS / MS
This take would be valid in 2014, not today. The people that still go to GS/MS from top targets are the ones that interned there as a sophomore and dont want to recruit anymore. EB much more desireable i. EBs have hit an inflection point in recent years.
On the PE side Carlyle is a shell of themselves and TPG isnt even a great AUM machine.
This is the same type of guy that will advise people to take Dillon Read over GS back in the day.
Now, let's get a ranking on performance because any of the MFs that were overindexed to growthier buyout deals are struggling. Everyone saw Vista with PluralSight but they aren't alone.
From Calpers:
EQT 2022: -10% IRR, 0.9x MoM
Thoma Bravo 2021: 7% IRR, 1.2x MoM
EQT 2021: 6% IRR, 1.1x MoM
Permira 2020: 6% IRR, 1.2x MoM
Vista 2019: 6% IRR, 1.2x MoM
And this is just what's being marked to market, DPIC figures are nonexistent for these funds, so no capital has been distributed back to LPs. Any of the tech investing firms are going to need the cost of financing to go back to near zero, or their current portcos are going to be serious dogs. Clearlake and others doing CV after CV to hide their fund performance.
Contrarian view, but I think the rise of AI will cause significant disruption and potential performance struggles from tech PE firms. So many PE funds started chasing tech assets at lofty valuations, a lot of the space seems uninvestable at the moment. If rates go back to zero, the music starts again and being indexed toward tech will lead to outperformace. But that's essentially investing in beta. It feels like there will have to be a reckoning for funds that truly have differentiation in tech investing versus those that were FOMO investors.
This exactly. Some of the tech deals that were being done in recent years seem unconscionable. I think many funds conflated the good fortune of ZIRP and the secular shift from on-prem to cloud with skillful investing. And now, in a historically more normal economic environment, we'll see who outperforms
This is idiotic. These funds are way too young to give an opinion on.
Well, not Permira and Vista at least. Have heard anecdotally that the above funds from these two guys are in pretty bad shape right now.
I mean when the S&P 500 has compounded at mid-high teens since 2019, the levered Vista 2019 vintage sitting at a 6% IRR doesn’t look so hot
Honestly, I don't know a single person who would go to EQT, CVC, or Permira over Bain or Vista (assuming you want to do tech for the latter).
vista lost its shine
Although it's definitely true that performance has been quite underwhelming as of late, it's hard to argue with their pedigree and overall brand name in tech investing (also the new 20B fund doesn't hurt haha). Have a lot of alums at great tech seats and it seems like a solid launching pad (at the an/aso level, can't really comment beyond that) if you plan on staying in tech investing. Fwiw I'm at a competing MF tech team/shop, so not sure how the sausage is made (this is just an outsider's perspective, so could definitely be missing some stuff).
Great places to be, but CVC, EQT, and Permira should be at the bottom of this list. No one who actively recruits for MF PE has these firms as a priority. At least at the associate recruiting level, no one chooses these firms over the names above them.
I worked at one of the new age MFs as an associate years ago. I no longer work there, but here's my view:
Thoughtful take, this is effectively how my banking team (coverage at GS) has been thinking about it
Indisputable fact that NYC is the center of finance and THE place to be, but have to call out the fake news on H&F.
You claim that a PE firm founded in SF, w/ most of its partners in SF, headquartered in SF, doing mostly software investing (largely out of the SF office) sends its “top choice” candidates to, wait for it, NYC. The reality is most of the people in NYC got the offer from H&F and recruited elsewhere / leveraged a prior offer to wait out for NYC. (source: at a group that places at H&F almost every year and was told by an alumn who did exactly this)
I think Aso quality at H&F is comparable across coasts; you clearly have to be a machine to get any offer from them. But, if you’re splitting hairs, looks like SF Aso do marginally better when it comes to promotion - the “purest” measure of H&F’s view of quality.
just so i understand this right…you’re saying these guys got H&F offers, took the risk of getting caught re-recruiting at other funds, got competing offers (what kind, other MF?), told h&f, and h&f rewarded them for that? why wouldn’t h&f just tell them to fuck off? i mean they’re easily gonna find candidates who are happy to work in any office. seems like a huge risk. Am i missing something?
This is obviously a lie. No one is getting an offer from H&F and shopping it around to go back to H&F for one of the 3 associate spots in NYC
The original comment here was correct. My friend at GS FIG who got an H&F offer got a NYC seat when signing. You can say all you want about it being HQ'd in SF, but the bottom line is that the NYC seats are much more desirable. Know of two people, one from MS and one from Bain who were told they would get told their location later. The internal dialogue within H&F was that if the latter two people reneged / went to another firm, it would be easy to replace them (apparently the MS analyst was ranked in the bottom 40% of his class)
NYC is preferred to SF, no doubt about that. But for a 2-year associate program, it's incredibly shortsighted to turn down SF roles for lesser firms.
When I was recruiting, most people wanted NY. But if you are lucky enough to receive an H&F, TPG, or Thoma Bravo corporate PE offer, it's not like there's a more preferred job. In fact, if analysts were forced to choose, the only firms they'd really pick over those 3 are Apollo, Blackstone, and KKR corporate PE. Not like anyone has ever been in a position to choose, but no one is picking an Apax or EQT in NY over H&F for a pre-mba position.
If we're truly splitting hairs here, this is how most would actually rank firms when recruiting, even if they have a preference for NY:
APO / BX / KKR
H&F / TPG / SL
Warburg / CD&R / Carlyle / Thoma
Bain / Permira / EQT / Vista / CVC
This is not true. I would argue the majority of banking analysts take EQT Tech PE over TPG software, for instance. The SF discount is quite real, for both prestige and lifestyle
I’m in tech at a “legacy MF”, and honestly maybe this is contrarian take but:
(1) In this day and age thinking corporate PE is the cream of the crop is wild. Out of those strategies you just named corporate PE likely will bring the least upside. If a kid isn’t sharp enough to recognize that, they are just drunk off the kool-aid from the last few decades.
(2) It’s also laughable to think there is any difference in mental horsepower between corporate PE kids and the other strategies. What we do is not any more difficult than other types of investing. If anything, I have consistently been more impressed with my peers in those other groups.
All that’s to say that I largely agree with what you are saying in comparing locations and legacy vs. new age funds, but I disagree that there is any stratification of talent or mental horsepower between investing arms at the same fund. A KKR-esque shop will always attract the top talent, and it’s a sobering but true realization that top talent in corp PE is most definitely not > top talent in growth, credit, secondaries, etc
Would move Bain up higher on this list for sure. I don’t know anyone who’s choosing the bottom 6-7 firms on here above Bain, except for a couple of specific teams.
Which forms would you say Bain is better than on the list?
Realistically, it just comes down to the individual when exits are in discussion IMO (everyone legit gets the same inbounds for the most part). Also, certain of these megafunds that have analyst programs definitely have better talent than some "higher-ranked" megafunds according to this list. Like, I don't think it's an insane claim to say that your average Bain, Vista, or FP analyst is probably a "better candidate" than an associate at Permira, EQT, or even Carlyle. Another thing I noticed is that the top talent in some analyst programs like Bain, Vista, and FP will usually leave after their analyst stints or even before that, while at places like Blackstone, KKR, or Silver Lake they will usually stay till associate, which I guess is quite telling as well.
I personally know MF PE analysts from Bain, SL, Vista, and WP from college, and legitimately every single one was way more impressive than post-banking associates at TPG, Carlyle, Permira, Advent, etc. (also alums from my college). Think this thread is mainly in regard to associate stints and not analyst stints. The MF PE analysts are usually on a different level (obviously there are exceptions with nepotism and diversity quotas but I think you know what I mean) than MF PE associates regardless of the perceived rank of their firm.
Well, I'm definitely getting downvoted to oblivion by all the people who couldn't get into a MF PE analyst program haha. I'm in the same camp, but I can at least call a spade a spade because I don't have a fragile ego. I don't see how this is a hot take by any means – obviously not a steadfast rule, but it largely holds (like yeah the Apollo and H&F associate might be more quality but I don't think what I said above is wrong in any form or fashion).
Not sure why you are getting MS. All the top talent chooses MFPE analyst programs if they could
how does cerberus and kps stack up in regards to the mentioned funds?
esp. regarding mba, HF exits, etc.
ik they're distressed focused, but would love to hear the rundown, thanks!
Bump
What does comp look like for KKR?
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