PCA to Secondaries PE - Harder Than It Looks
Even looking at top players in the space, the amount of analysts and associates which successfully jump from PCA (private capital advisory) banking to secondary private equity (or hell, any type of private equity) seems to be very limited. This is despite dealing with BX, CG, Ares, H&F, GA and other very large PE shop regularly. I would also assume that the skillset transfers far smoother from PCA to secondaries vs say REGL IB to secondaries. Why is this? Do PCA bankers just not exit banking at the same rate (it is naturally a small cohort already) due to the better WLB or do HH dislike this background?
Is the lack of former PCA bankers in secondaries a red flag for those interested in secondaries?
EDIT: It appears (from a VP in secondaries) that the industry is getting more talent from PCA recently, and that they take people from a wider array of roles than NAPE/LBO PE, which is why it can seem that fewer analysts make the jump (if you were to look at top buyside shops associate profiles).
Just a thought, maybe it’s because PCA pays extremely well at the Senior level. The secondary strategy also still has massive room for opportunity and growth.
Better WLB than M&A, probably better pay at an EB vs. Secondaries PE, don't have to prove yourself again at a new firm
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For now, PCA at the top places still pays more than an equivalent position on the buyside while often providing a superior WLB.
This will likely change with the power curve in the space shifting from FoF to buyout platforms entering the secondaries market (see Ares, TPG, CVC, Apollo) and salaries rising across the board.
Plus, there is a very (very) small pool of sell-side talent compared to basically any other mainstream IB product, hence the track record of movements from advisory to investing is rather limited
sorry can you clarify how / why exactly the shift will impact PCA? I'm interpreting your comment as saying that Buyout platforms are going to pay less for advisors (which does make sense given what I've seen on those guys you mentioned...)
Let me clarify: Buyside positions at new entrants (particularly at buyout platforms that are entering the secondary market) will likely pay more than the FoF platforms like HarbourVest and Pantheon which have historically dominated the secondaries space, thereby narrowing the gap between buyside pay and PCA pay.
Portfolio Advisors leadership are ex PCA and they're useless as they aren't investors. Sometimes it translates well and other times it doesn't
I think the transition is easier at the junior levels. PCA Directors + moving to buyside never really made sense to me.
Interesting. Wonder if you could elaborate further? The senior folks at PortAd look credible to me
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