PE Comp -- VP level
How much are VPs making these days? Let's say mid size shops, $5-$15B AUM type places.
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Probably $500-700k in cash with some carry
Roughly $500-600k cash plus $2-5MM carry DAW
Sorry for dumb question, but what is DAW?
dollars at work
Others being dicks for no reason. My $.02 - you should be able to easily, quickly, and succinctly explain topics at varying complexity ranging from elementary school to SME...
Dollars At Work (DAW) is a way to convey carry. Essentially fund size x carry percentage x your own bps of carry = DAW
AVP count? Basically SR-ASO w/ carry. $400K w/ $3.5M DAW. MF, >$300B AUM, T5 COL area.
What's CED? Carry %points?
I have no idea what CED is. That was supposed to be DAW. Every day autocorrect works against me more and more
What MF gives Sr. Aso carry? My understanding is that most gave carry starting at VP level
Most do not, but some do work with you. Full disclosure, I've now moved firms but a blue chip MF via an RE vertical granted me carry due to performance and comp adjustments - i.e., less bonus but carry could be realized. Not the typical structure, but exceptions do arise - for me, I just asked and then negotiated comp. Worked out pretty well then as you can see.
Interesting, I was expecting cash comp closer to $400k vs. some of the above responses. Maybe closer to $400k for a newly minted VP moving up to $500-$600 with experience.
Would be good to know latest Fund AUM and overall Firm AUM. Good benchmarking tool for associates/sr associates that are thinking about next step across UMM/MF/LMM opportunities
~$400k for VP1. Carry DAW about double comp. LMM firm ~$500m.
~80bps of carry for vp1?
Roughly. Carry is "low" on face value but it has generous terms and is deal-by-deal. The latter makes a significant difference.
For UMM/MF you should expect 500-550k year 1 scaling to 650-700k by year 3 maybe. DAW in the 4-5m range is about right
Pre-VP title / VP0, 600-650 cash, 4-5m DAW. Large cap fund.
VP1 - $350k Cash / $3M DAW - LMM $5B AUM
$5M AUM? Is that a typo?
You think he has $3M daw in a $5M fund?
Idk, AUM is hard to pin down since it depends on how you value your portco.
I worked at a shop on the lower end of LMM and we had $2B AUM
VP1 - latest fund $5B+ $650 cash, $5mm DAW
NYC?
Is VP the immediate post mba role ie 2-3 years of exp or inclusive of a post mba promotion? Good offer
NYC and I didn't go to B-school but this is immediate Post-MBA level (we hire MBAs to this exact level)
$1.1B latest fund in NYC
VP1 - $400k cash, $3MM DAW
VP2 - $450k cash, $3MM DAW
VP3 - $500k cash, $4.5MM DAW (increased DAW only applicable to deals done after promotion)
Close to $1bn Fund in South - $350k cash with $3mm DAW
Cash leaves something to be desired, and the carry has some weird thresholds to it. So yeah, comp is perpetually below market but culture is great and could see myself here long term. Makes it worth it
What does DAW stand for?
Dudes and Wenches
Money you get once you get erectile dysfunction ("Dicks Are Wrecked")
Dudes at work
It stands for “Dollars at Work.” Calculated as roughly the amount of pre-tax carried interest you would receive over the life of the fund if the fund returned a 2.0x.
Thank you!
A few follow-up questions here, would appreciate clarity
1) How long is the typical lifetime of fund these days? I guess it could depend but would 5 years be appropriate time from fundraise to returning cash to LPs, at which point I guess the carry payments come in?
2) Seems like funds are raising new funds every couple of years, so does this mean you can have carry in multiple funds at the same time before actually receiving any checks? How does this work?
3) Is there a vesting period on carry? i.e. let's say you have 1mm DAW in a fund that will start paying out in 5 years. If you leave for another shop in year 4, do you lose the ~200k carry you are theoretically earning each year prior to leaving?
Firm: $500mm - $1bn
VP1: $455k (cash)
VP2: $495k (cash)
Currently ~$3mm DAW.
Location?
NYC
Wow, that's great comp. Congrats.
How much GP commit do you all have to contribute? Does it come out of your comp or loaned?
None - our MDs cover it
Mine’s $200k min for VPs, $400k for principals. 3x leverage so you’re out of pocket $50k/$100k.
None for us until you hit principal, but I’m voluntarily coinvesting $750k (70% levered / 30% equity), with most VPs between $400-800k. I think that’s roughly in line to above required GP commit at shops that have it for VPs
Any data points for London?
400-500k with 1-2m DAW as VP1 in LMM
That’s crazy
Question for the group - how long are you all expecting to be at the VP level before expecting a SVP/Principal/Director promotion? And if you already had the conversation with your partners, would be interested to hear what they indicated as the necessary "milestones" they'd like to see you hit by then.
I'm planning my next few years and just hit VP2. Hoping to have the milestones conversation with the partners sometime this month.
3 years. Need to manage each of the deal phases: source, underwrite, close, value creation, monitor, and exit. I’ve led most but not all. I’m planning to have led each part by the end of 3 years and at that point get promoted to principal/director.
How long did it take to get to VP level for either of you?
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