Why is MF PE 2 Years and Out?

What's the thought behind most MF PE firms' 2 years and out policy? Why would you not want to keep more tenured associates at the firm for a couple extra years if they're willing to continue at a similar pay level? Is it just to continue cycling talent through as fast as they can, so they can be extra picky on the folks they ask to stay?

2 Comments
 

If realistically almost no one will get promoted to the VP+ level - then why would any talented MF associate want to stay more than ~2-years? (this is usually after a ~2-3 year IB stint, so now we're talking about ~27-28 year olds). 

The job is also extremely tough in the associate role lifestyle wise - most people wouldn't want to do it for any more than ~2-years. 

 

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