Why is every PE firm so top heavy?
Title says it all. Do these partners just literally never leave? There’s only so much carry all the top dawgs in the firm can get.
This is obviously why a lot of mid level high performers also don’t get promoted to MD/Partner.
Yes, partners rarely leave. There are not many jobs that pay you a floor of low 7 figures with potential for much more through carry. Carry also vests over time, so if you leave you would be leaving potentially millions in carry on the table. The reason why growing funds are more likely to promote people is because there is more carry to go around. Similarity a MF is very slow in promotions because many are public (have to split the carry with the public) and are not dramatically growing fund size.
So I guess if you’re a mid level guy in PE you need to decide 2 things:
Is my carry going to be worth anything material for me to stay another 5 years?
Even if the above is true, will I even get promoted given my seniors are so resistant to leaving?
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