I was promoted to Sr. Associate at LMM PE fund that I worked at in December 2019 and then quit in March of 2020 without having another role lined up. I did a Q&A right after I accepted what at the time was my dream position as a PE Associate and I thought it might help some people to do one now to talk about what I have learned in the last 3 years and why I am leaving.
I had known for a while this role wasn't right for me but I had spent years trying to get into this seat so it took my mental health deteriorating to a pretty bad point for me to finally decide to leave the role. I was actually at a firm with relatively good work-life balance for the most part but going to any job each day that your not passionate about will eventually took its toll. Also, I have had a pretty big shift this year in what my life goals are as relates to accumulating wealth, doing something that I find meaningful and spending time with my family so it was actually not only a necessary but somewhat easy decision.
I left my job right before COVID ramped up to a global pandemic so that has hindered my search plus I took things slow for the first few weeks as I focused on improving my health so I am still trying to figure out what will be next. I am looking at a fairly wide range of paths including corporate strategy and development roles, various types of positions at startups or going back to school for my PhD in Management.
I think last time that I did a Q&A my post was way too long so I am going to keep this first post a little shorter and willing to answer questions on almost any topic so we will see where this goes.
Thanks for doing the Q&A!
1) You mention work life balance not having been too bad at the LMM fund you worked at. One of the common reasons people quote for moving from IB to PE is better hours (assuming it’s not MF PE). Just curious, what were your typical hours per week during “regular” times and then in the heat of a deal?
2) As a first year PE associate who has started to question the longevity of the career path, is there anything you think you could have done differently looking back to avoid burnout?
Live deal hours can steadily ramp up from what I wrote above to 100+ hours/ week for a month or so especially if you are pushing towards a short close.
Some additional thoughts - I was always checking my email when I was away from the office to make sure I didn't miss anything especially when there was a lot of activity (good or bad) going on at the portfolio companies that I covered and when on a live deal. Whenever I was reading news or talking to colleagues, I was constantly thinking about how developments could impact my portfolio companies. This also doesn't include the weekly networking/ happy hours events, coffee chats, etc. At the end of the day, this isn't a 9-5 where you can just shut everything off at any point so there is a lot of variability. Commuting is dead time at the junior level because you really have to be in front of a computer to do ~95% of the job.
Reasons the role wasn't right for me:
Didn't want to spend 12 Hrs+ staring at a computer screen for the next 10-20 years until I maybe made partner one day - along these lines got really tired of excel and building / updating models that were solely to CYA in case something went wrong with an investment and LPs needed proof that we did our diligence
Looked at those more senior deal team members that were just below the partner level and realized that unlike IB the role didn't seem to change dramatically as you move up the chain
Wanted more interactions with people on a daily basis and a role were I can manage people
Increasingly wanted to get more involved in building something myself instead of sitting back and watching how our portfolio companies were performing
Seemed like every deal has an advisor these days and processes almost always came down to an auction decided by price. Bigger funds keep seem to keep pushing down into smaller deals and are willing to stroke a check so it was tough to win deals.
Due to lack of scale my role became very hybrid between investor, jr. resource, admin, etc. - examples: building legal schedules, printing and distributing data room docs, IT support, and lots of other tasks that a bigger firm would support with more resources.
Reasons it was difficult to leave
I am in a small market and believed that if I left now I likely would never get another PE role in the same market - after thinking this was my dream role for a number of years this was a tough pill to swallow so wanted to be 100% on the decision
I just received a raise and carry so would go back and forth on whether it was worth it to suck it up and stay for a few more years
Really didn't know what I wanted to do next - still figuring that out
This is a great post / response. Coming from a very similar position I can confirm all of the above points. Ultimately I joined a port co in a Chief role and have enjoyed this overall much more as you get rid of a lot of the admin BS you have to deal with as a junior to mid level employee at a private equity fund, specifically in the MM / LMM.
I think one day I may want to get back to PE investing but very happy with the move.
Posting mostly to just follow.
I’ve decided to not pursue PE as I think I’ll find myself in your position 2-3 years down the road. I just don’t like deals / the investment process. Feel like I’m a much better fit on the operational side but what that means in terms of next steps is still TBD.
Also, maybe it’s just me but it feels like there have been a lot more of these posts lately, or maybe I just never noticed them when I was in school as I was so focused on breaking in to begin with. Either way, it’s been helpful to see more of these as most people around me outside of the forum seem to be still drunk by the PE dream.
I resonate with a lot of what you said. The problem these days for people who don't want to stare at a computer screen all day (myself included) is that there aren't a lot of alternatives. Most careers involve that to a large degree. I was a math major who was on the math team in both high school and college and genuinely hate Excel modeling. I always sort of hated it. It's boring as fuck and it's not real math, so it's not intellectually challenging in any way. Sadly, people are willing to pay more for that mindless skill than they are for anything I can do which takes any real brilliance.
In any case, I've been where you are before and chose a different path than most kids on this forum. It's difficult to be introspective at 22 and see that money isn't everything for everyone. That's especially true once you have some money. If you take a few years to find yourself and try a few different things, you'll probably be a more interesting person in the long run.
Best of luck to you, sir!
It is amazing how many jobs require you to be on a computer all day. This has been a major hurdle but I think I wouldn't mind it as much if I could have more interaction with people (this could even be just working somewhere with a bigger junior team), travel (I realize this a double-edge sword), etc. just to break up the monotony that I was experiencing in PE.
Admittedly, this might be a grass is not actually greener situation where I realize that I had it pretty good and do a 180 in a few years but this felt like the right time to learn that for myself or find something that I really enjoy. This has also forced me to start thinking of careers further off the beaten path like going back for my PhD to become a professor, join a startup, or something totally different. However, getting someone to take a chance on me to do something that I have never done before when everyone is working remotely has proved very challenging.
I have also realized during this time off that some of what I am looking for can be supplemental to my career and not necessarily come directly from a job - e.g., volunteering, non-profit boards, volunteer coach, forcing myself to learn a new hobby like kiteboarding, etc.
Almost 6 months after leaving the firm, and having some time to reflect on your decision to quit without another job lined up, future job options, your personal life and priorities - do you think it was important for your self-reflection to have quit without anything lined up? And do you have any regrets about quitting without anything lined up thus far (for example to your point about getting someone to take a chance has been challenging)?
I personally wish PE was more forgiving towards people taking a career sabbatical (i.e., quit without anything lined up including not going to b-school) and then wanting to come back to PE after to reflect or decompress. I think almost everyone would agree that throughout a 30-40yr career, people will inevitably have doubts about their jobs and/or need time to reset and reflect.
And yet, unless you go to get your MBA, you're essentially being punished for wanting to distance yourself from the job for a period of time, to be able to reflect without being biased by sitting in the seat everyday. Let's not kid ourselves in thinking people aren't getting their MBAs because at least in some part, they just want a 2 year vacation. There are plenty of legitimate reasons why someone may not want to spend $250k to get their MBA, for many people it's just a poor ROI financially or qualitatively.