MF PE vs MM PE
What are the pros of MF PE aside from comp and prestige? Not sure what exactly the answer is here - what’s the benefit associated with having more capital and looking at larger companies?
An interview question my friend was asked
I don’t work in PE yet (have an offer at a UMM for next summer) so take with a heavy grain of salt, but I’m at a BB and one of the noticeable things that’s different versus smaller banks (interned my sophomore summer at a regional boutique) is the amount of resources available. We have every tool / application, we have an India team to send monotonous tasks to, we can reach out to an MD in another region when we need advice about a target or buyer in another country, there’s a dedicated team for every possible product, etc… I would think the same holds true in PE. Larger firms in general just have more resources available for people to take advantage of.
Hopefully someone who actually works at a MF can comment confirming / denying since this is all conjecture.
This is true. By nature of working on large transactions for global companies, there’s also more complexity to the deal experience you get
Could you elaborate on what forms of complexity you see?
The most talented people are chasing prestige and comp, and you want to learn from and be surrounded by the best.
The companies have far more sophisticated financial reporting.
Bigger deals means more resources. Can hire consultants and work with industry advisors.
Better business school placement, on average.
There is more exposure to public markets, both via IPO exits and take privates. Wouldn’t use this answer in an interview, though.
What’s so bad about the answer? Maybe some wordsmithing but shows that you want to best possible learning exposure and be able to learn across the range of opportunities. What am I missing?
I think he means the don't talk about wanting to chase prestige and comp part.
In addition to the comments around most talented people, prestige and more resources, one obvious point are the fund economics.
Whether you are writing a $200m equity ticket or $1,000m equity ticket, you need a similar team size. However with a 2x MOI and typical ~20% carry, you make $40m and $200m carry respectively.
Is this an answer that I can say in interviews lol
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