When does PE comp catch-up to IB comp?
For most PE firms, associate pay is 20% lower than IB comp. At what point does the comp actually catch up? How is the carry taxed - do you get a 1099?
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Without even getting into carry point, I bet you PE associates come out ahead of IB associates this year (at UMM/MF funds).
Banking salaries and bonuses shot up last year but let’s see what happens when advisory fees are down 40%. Would be shocked if many associate 1s are pulling $325k+, especially at BBs.
Obviously this isn’t the case at MM PE funds, but at large cap funds salaries are still very solid
I would think the pull back this year affected PE firms too since debt is too expensive to do deals. Where do you think associate 1s, 2s and VP 1s to land this year
PE pay is way stickier than IBD. I doubt bonuses will be down much (if at all). May roll back some one time special bonus items because people aren’t getting crushed like they were a year ago
Outside of one time bonuses there will be no impact because salaries are paid out of mgmt fee and fund raising is in 4-5 year cycles.
PE firms make money by management / advisory fees (that are generally going to hit each year regardless of economic cycle, assuming no downside scenarios) and carry. The latter only happens upon a realization and even then, depending on structure (i.e .fund, independent sponsor), it may not payout until hurdles on reached on the overall fund.
How risky are layoffs in PE in a slow market like now?
The only risk is if the next fundraise is lower than the current fund
Second year at a MF and have been guided to around $375k all-in cash (no carry), unsure how many of my banking friends are clearing above $325k this year
What was your first year all in?
Feels like never in European MM
Signed an offer for UMM Aso1 that is 350k all-in (150 base / 200 expected bonus)
Hard to compare comp because a lot of pre-COVID threads feel outdated
At a MF and our base + bonus is pre-determined for our entire Associate program. Expected to clear $400K+
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