PE / IB Pay
At what point does PE make more than IB in MM or UMM firms?
IB Associate makes $300k - $400K now and PE associate makes total comp of $220K - $260K based on the firms that I interviewed with. Wondering at what level is PE comp higher.
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I am based in London and observe same pattern - MM PEs definitely at discount to IB. Will only catch up with carry
Agreed. London comp very sad and reliant on carry for the catch-up.
Although, lifestyle is pretty OK (in most instances).
bump
Is IB associate comp really $300-400k in this market? At a MF and making $375k-390k (senior associate) with VP's at my firm making $500k+.
At that point, I don't think cash comp really matters as I'm working 60 hours (2-3 hours of weekend work) compared to my IB counterparts pushing hours consistently 60-70 hours. Oh and don't forget that carry starting from VP which at UMM/MF is anywhere from $1.5m-$3m (granted this will take 5-7 years to actually see anything)
is carry similar for credit as well?
Assuming that 1.5mm-3mm of carry is per fund and not an annualized number? I'm curious how would that translate / get paid out annually?
Are you pre or post mba
Pre-mba
I don't think the salary + bonus cash comp is ever higher
What to expect in total comps? Doesn’t need to be cash comp.
BUMP
PE cash comp typically doesn’t beat IB bull market cash comp. The big differences are 1) PE base + bonus is paid out of management fees, so there’s close to zero risk of a bad year (vs IB that can work hard all year and still get a shitty bonus or laid off), and 2) PE starts to participate in the upside. As a MM VP, I get $500k cash, which is more or less competitive, and then I also have a $2MM carry allocation - which could be an extra $200-400k/yr or could be nothing, and either way I won’t know for 5-10 years.
If we do 3x in 7 years, it blows IB out of the water. If we do 1.6x in 12 years, completely different story.
So what happens if you leave before carry materializes
Usually subject to vesting and / or buybacks, which have been discussed elsewhere. In any case you’ll probably retain something, but leaving will materially reduce that amount.
Associate roles are one thing, but at VP+ the incentives are structured to keep you around, and expected longevity should absolutely factor into your decision
TL;DR: you get screwed
Can you shed some light on senior associate pay? My understanding is that there's a much more direct path for IB moving upward than in PE.
I know associate pay are usually $110k - 120k base for 1st year and 100% bonus plus $10k signing. After 2 years, what do you expect for senior associate?
I think our current associate payscale is:
ASO 1 - $275k, no carry
ASO 2 - $300k, no carry
SR ASO 1 - $375k, $1MM carry
SR ASO 2 - $400k, $1MM carry
Is the carry quoted per year?
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