Middle East SWF questions

Hi Everyone,

I'm in the the interview process with three Middle East SWFs (all about the Direct Investment team; 2 on PE and 1 on VC/Growth Equity), and would like to get some opinions - see below.

ME and their SWFs were basically unknown to me but I've done a bit of research, and have heard both pros and cons and am trying to figure out their impact in my case.  Major pro seems the good pay with 0% tax - I'm not US citizen so this seems quite nice.  Cons seem: (1) you tend to get stuck as career progression is slow and not clear, worsened by the fact that local hires got prioritised over expat in promotion; (2) no exit to other PE/VCs for some reason - I wonder if this is the case for all "PE/VCs" or just the tier-1/2 global funds; (3) boring and LP kind of job as they typically just follow other real GPs even in direct investing; (4) expats work like a dog (some others say good WL balance though so not sure which is the case)

Now my questions: (1) seems a real issue and that means you have to figure out where to go in 3-5 years if you don't remain where you are for long term - is this really the case?  For (2) is it the case you have no/poor exit everywhere?  I know these SWFs get access to popular deals.  So regardless of what you do having those deals on your CV is still helpful I think?  I'm not necessarily looking to break into tier-1 funds, and geo-wise I'm happy with Asia (HK/SG) besides US or Europe.  For (3), I don't know but I've been doing direct investment for almost my entire career, so I guess doing a bit of LP stuffs (as long as it's not majority of the work) is OK for me. For (4) just wondering which is the case.

I've heard other cons like ME being more boring than NYC/London/HK; or your partner may hate the place.  I have a little family of 3 so the boring place is probably less of a problem. Also wife works in Crypto industry so she'd be keen to get close to Dubai.

Thanks a lot guys.

CH

[My background just for reference: always in buyside (no standard IB training): several years in PE/buyout (single sector - a traditional industrial sector - focused) in NYC and then Hong Kong - small boutique and unknown firm, but done some big deals with good learnings; then did 1 year in a growth equity fund in Hong Kong - also less-known local fund but luckily closed 3 deals in 1 year - as small participant in big rounds with well known Silicon valley and Asian tech companies;  and then moved to the corporate VC unit of a global fortune 100 corporate in Europe for another few years - not very exciting experience as the corporate doesn't care about $ return but business fit.  Did some early stage deals with unknown startups (1-2 good exits only).  Biggest problem here is there seems no career progression in this team (we don't end up as Head of Corporate VC or CorpDev for some political problems and historically people had to leave at some point) and many deals are not real investment but OPEX in my eyes, let alone the frustration with the corporate politics and stupid inefficiencies everyday.]

 
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My 2 cents based on working very closely with ME SWF in many occasions (and having good relationships with the expats in such funds): 

(1) seems a real issue and that means you have to figure out where to go in 3-5 years if you don't remain where you are for long term - is this really the case?

Career progression is definitely unstructured and "locals" (let's call them the "enlarged royal families") may always appear as team heads in a completely random way. It's better to negotiate in advance role and guaranteed progression. However this applies more to the roles of Industry heads and above, while from junior to mid level everything should be easier and more aligned to standard.

Many people remain despite limited career growth as the salaries (plus tax benefits) are often unmatched, if you negotiated well at the time of hiring.

(2) Is it the case you have no/poor exit everywhere?  I know these SWFs get access to popular deals.  So regardless of what you do having those deals on your CV is still helpful I think?  I'm not necessarily looking to break into tier-1 funds, and geo-wise I'm happy with Asia (HK/SG) besides US or Europe.

I think "no exits" is too pessimistic. It's going to be extremely difficult to go to Tier 1 MFs, but MM / LMM PE (maybe with some seniority cut) may still be possible. While co-investment funds, funds of funds, family offices etc. will all be possible / likely exits.

(3) I don't know but I've been doing direct investment for almost my entire career, so I guess doing a bit of LP stuffs (as long as it's not majority of the work) is OK for me.

In my opinion there's a big chance you're going to hate it, coming from direct investments. I'm just saying this so you can assess it carefully.

(4) just wondering which is the case.

I head both type of stories, but definitely nothing comparable to classic MFs. It's probbly aligned to the average MM PE, with 9-7 off deals and 9-10/11 plus some weekend work on live deals. Dubai just changed but previously Sunday used to be a working day with Friday being holiday, which in practise - when you are live on US/European deals, meant that only Saturday was a real holiday. The new working week may work better.

In my experience Dubai is enjoyable (with its pros and cons), while all other altenatives (Doha, Jeddah, Kuwait, Muscat) are quite tough for the average Western family.

 

Many thanks Sprezz for all the details you provided; very insightful.  

Actually out of the 3 I'm looking at, 1 is in Riyadh which I have abandoned as I don't think I can ever handle the culture shock over there.  The other 2 are in Abu Dhabi.  I heard Dubai is quite liberal and more westernized - obviously more than Abu Dhabi, but it also looks like that in general UAE is OK. You are right they've switched to the Sat/Sun weekend since beginning of 2022 throughout the country.

Overall it looks like how much it's worth it depends on how good a package can be negotiated to start with.

 

Hey i'm currently just a student but have lived in UAE for 15+years, depending on your hours you can live in dubai and work in Abu Dhabi, really depends on whether your willing to travel, Upside is, if you are into cars you could get a really good used sports car for cheap and enjoy driving it, be careful of the fines though.

PM me if you would like to know more about living in UAE

 

I'm an Analyst 1 at an EB in London and am looking to move to a PE/SWF in my second year as an Analyst. My goal is basically to accumulate as much capital as I can when I'm young so I can start my own thing. Would be really interested in hearing people's experiences about moving from IBD to a Middle East SWF (preferable ADIA/Mubadala, but any of them). Do you think its better to get a year's experience of PE in London first to hedge myself if I ever want to come back to finance in London? Info on comp/working hours at these funds and the recruitment process would be so helpful for me. Thank you!

 

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