MM VP move to UMM/MF? Advice needed
Experienced VP in HCOL made 580k in 2023 - quite unhappy with that. I have $4.5m DAW (plus tbd amount in new fund). Joined the fund 2 years in and it's been 2 years so it's mostly deployed - going reasonably well marked at 1.5x. We are just finishing up raising a 40% larger fund in a tough environment so that's a good sign. Carry in new fund being figured out so let's see but imagine at minimum equal to current amount. I should note half of it is American waterfall and half European (funky I know).
Lifestyle is 40-45 hours off deal which is 70% of the time and 80+ ish on deal with is 30% of the time. EDIT: sorry for typo I meant this to say 45-50 hours 70% ie 10-8pm. 2 days in office. We usually take equivalent of 5 weeks off a year (including Christmas and thanksgiving and long weekends). Vacations are almost completely free and principals or senior associates will cover for me and vice versa me for them - this I admit is a lovely perk.
I was promoted to "senior VP" which is a nothing promotion where comp is bumped 10% but nothing changes. Expect 650-670k for 2024. Was told principal promo is in 2 years if all goes well. Apparently step change in comp then (2x) and I was pitched the future is bright for me etc. In all candor I do have quite a bit of "political capital" here fwiw.
Now I have a verbal offer at a well known UMM/MF type fund (think 10-12bn+ latest raise). Imagine cash comp would go up to 800k+ and carry may go up although given I don't know my grant in the new fund tbd how much. No clue re lifestyle but it's a respected fund and nice people.
What are your thoughts ? I just feel a bit dissatisfied reading about this massive cash comp at large cap funds. Am I missing the bigger picture ? Do I have it good? Should I make a move? Any advice ?
If your in goodstanding and have path to promotion I would definitely stay - that’s what everyone is looking for. Cash comp should not be a driver - I think carry and long-term carry potential are all that matters here. There is a lot of risk switching to a spot where the promotion path is less clear. Would have to consider fundraising and scaling ability as well. In my opinion, there’s probably more to be made from a scaling fund then a mature one
I’m young so my advice means less…
But longevity is key, seems like you are happy excluding the cash comp. You also seem to have a clearer path to realizing the upside where you’re at now.
how big is your current fund? Comp doesn't sound too bad depending on size. Only thing that's a bummer is the half euro waterfall but otherwise sounds like a good seat.
There are several folks on here who are more qualified to answer this question, and I assume they will find it. So, my two cents:
It's really a question that you have to answer yourself. Is the cash-comp hedonic treadmill a key determinant of your self-worth? I realize that this might be a harsh way to pose the question, but I do think that is the question that you must answer. If your fund is raising reasonably well in a tough environment (and if the marks are a solid 1.5x instead of a vapor 1.5x), you are probably overvaluing W-2 vs. future K-1 income. Your WLB sounds market, having other teammates competent and willing to cover is a godsend, and I would not scoff at accumulated political capital. You'd be taking a heavy discount on this to move upmarket. I would not make this move.
A couple of questions that you probably want clarity on from various stakeholders before making the call:
You'll see that two of the three questions relate to the K-1 side of the equation, because that is the most effective way to build wealth (and, yes, realizing low single digit millions of dollars does begin that process-- even if you're comparing to folks with eight-figure allocations).
My best friend from MBA is at a well-performing MF. I adore him and our wives are close. He is able to spend time with his wife and to travel with us. On vacations, he could be on a call 12 time zones away, at four in the morning. He's cranking on pointless IC updates. He's also the smartest person I have ever met. I do not, under any circumstances, want to work his schedule. The marginal utility of having my own plane vs. a NetJets card just isn't that high to me.
I value flexibility and a known, collegial environment with political capital because I want to have a disproportionate say in what happens to my portion of the GP commit (and because taking vacations without worrying too much about work is perhaps the best thing I can do for myself, my family, and, yes, my firm). I would not make this trade (and would suggest that you look to find value in yourself unrelated to your W-2 income), but I have seen people do it before. If you do decide to move upmarket, I hope that you find contentment and that you are able to accumulate the same political capital in a larger, more complex organization.
Wherever you have the most and realistic potential for upside is the place that is better.
It sounds like you enjoy your current place the most. You've done very well, built up a lot of goodwill in your own group, so why not just stay? It's not like you can bring over the chill hours and good culture you have in your current group to the next place, it could take years for you to re-create the ideal work environment that you already have and that anyone on this site would likely want to join
First of all, congratulations on your success so far.
I'm just a newly minted VP at a MF (3 years associate) but your comp seems pretty strong given your fund size (I will assume ~$5bn). Yes, your cash comp is lower than MF/UMM but what do you expect? Your fund is 1/2 to 1/3 the size of a typical MF.
The firm culture seems great, I haven't heard of a firm that is 2 days in the office and only working 40-45 hours 70% of the time is crazy. As a VP I'm expected 4 days in the office and generally work 9 am-10/11 pm. Also vacations that are honored? That is a game changer
I don't know of any experienced VP making 800k+ cash comp (maybe Apollo?) or maybe I'm also being underpaid (lol). But seriously even if you assume a c.$200k comp difference for two years that is $200k post-tax and when you have millions (literally millions with a realized mark of 1.5x) in carry and the firm performance is good AND you have sight to partner you would be a fool to leave
Yea this dude is reading like a troll - that WLB with comp structure is borderline unheard of. Either this is a "test the waters" post to see how people reply, or he's a hardo who will never be content with his station.
Not a VP yet but am i going crazy or is 45 hours for 70% of the year with 600k in cash comp not patently absurd/unheard of? shocked you are upset at that pay to WLB ratio, not even factoring in the fat carry you already have with another allocation imminent from a 40% larger fund? You live in fantasy land if you are mad at this.
I guess the question is would an extra $75k per year (post tax) for the next two years really meaningfully impact your life? You’re going to be extravagantly wealthy in 5-10 years either way but with much more risk at the MF side (I would not underestimate internal politics and fund performance issues at the some of these places). If nothing will change for you other than a few extra dollars in your bank account I don’t see why you’d make the move.
Let me know where you work so I can interview for your current gig. At a MM fund ($3-5B) where I’m getting paid way less (with far less carry) and working way more.
Man, don't leave. You have a direct path to big carry dollars, good WLB for the industry, and your cash comp is fine. It's hard to put a price on the flexibility of only going to the office twice a week. The extra 100k or few 100k is not worth it if you burn out / get canned at another place if there's no path.
OP you have it so good with the WLB and vacation dynamic. I can’t tell if this is a troll so will give you the benefit of the doubt.
If this is real, you have an amazing role and upward trajectory. Maybe I’m missing something / your personal goals, but from what you’ve said I’m not sure why you wouldn’t stay
Seems like you're in a good place. Are you happy? Do you like the people you see and work with every day? Do you think the firm respects you? Do you think the new firm would obviously be better in any of these facets?
I'm not in your position but don't let perfect be the enemy of (really) good. Grass is not always greener (I f'd around and found this out the hard way once)..why risk it if you're happy? You're making great money!
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