Will PE funds do lay-offs assuming the lack of investment opportunities continues or can’t hit fundraising targets?
Would appreciate concrete datapoints or things you’ve heard from your team recently. Have felt like everyone is very on edge and concerned about this everywhere.
Starting to see vp-principal level folks not on the partner track being pushed out or moved to BD type roles. Only hiring now above 1st years is on fundraising side
We've closed 2 platforms and closed on an upsized fund this year...
Cool story, bro.
Yes.
Onex just did a round with handful of principals
Do you know if any juniors like associates were let go as well, or partners? or is this just mid-level folks?
What happens to carry in that case?
Yes, and the publicly listed funds who need to maintain a certain cost/income ratio will be under more pressure to do this.
Maybe at the public firms, but more likely scenario is firms getting much more selective about promotions. Since PE firms are slightly less cyclical than sellside, they can afford to keep people on the payroll for another year or two (imo)
For the public firms like Carlyle, as an example, heard fundraising is on pause and wasn’t going well period, there’s also some issues with management I think…but even then does it make sense for a fund like that to massively trim down the team given they have existing investments to manage which require manpower and also assuming the environment improves, in a year or two they’ll raise again and have a load of new capital to deploy and theoretically wouldn’t want to go through the trouble of hiring everyone back?
"theoretically." hmm
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