Take a $100k paycut to get into buyout PE?
I currently work in a multistrat investment role doing equity/credit opportunities in a niche industry which I started 2 years after banking.
I had always wanted to do traditional buyout PE, but the offers never came.Fast forward 2 years, I am getting LMM / MM PE looks due to my experience at my current firm.
The only problem is, I am in a HCOL city, and the offers I am getting are at or above a ~100k paycut to my all in comp of ~320-350k
Is it worth taking a paycut like this as well as alikely increase in hours like this to get into LMM/MM PE?
I feel like on the one hand the answer is yes, but on the other hand, it might be a bad sign that these firms are lowballing me, or the firms I'm getting are low payers.
Curious, what is it you do/don't like at your current role? sounds pretty cool on paper and pay is great, but if pretty niche I could see why you might want to make the jump. 100k paycut is steep but mid 200k's in LCOL area probably isn't as steep a drop as you may think factoring in all-in take home + increased savings rate. Another factor to consider would be hours/WLB, assume hours would ramp up from PE compared to your current seat but may be off on that.
It is a really cool and interesting role and I generally like what I do. The main problem as I said is the types of deals and the sector I am in is niche and so I feel a bit cornered. Also, won't go into too much detail but I don't love the investment committee at my firm.
As you mentioned, I am having a hard time justifying a 1/3 paycut AS WELL as a ramp up in hours, with people I potentially could not enjoy working with.
Can’t really tell if I’m using fear or logic.
That’s a steep paycut.
I know folks on here love to say “who cares about $100k, 10 years from now it won’t matter”. Reality it is for many of us (assuming you’re not from an upper middle class family) that shit matters. I would think long and hard about this decision. How niche is the strategy? Any chance you can continue recruiting where the haircut isn’t that bad? Additionally, I know having an IC you’re not fond of does impact how you approach your job, can you continue seeing yourself working at your firm and eventually growing into liking the process or making real changes? Is there room for you to grow at the current firm? Just throwing a lot out there. Coming from $300k to 200k is a bit much on top of being in a HCOL city but if you’re unhappy in your role and fear it’s too niche and this opportunity is your chance to break out. Go for it. But certainly give it some real thought
MM PE London, from my POV, unless there is a decrease in hours - don't do it.
There will be other / better paid opportunities with fewer hours.
Definitely not
Unless you really love your current strategy, i would make the jump. Getting your foot in the door is the key thing. After a couple of years, you can look for a firm that pays better if this is still a problem. People telling you that 100k does matter right now are wrong IMO. Sure, every dollar matters, but assuming you’re still early in your career, this is the chance to take what is barely a risk.
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