I see a lot of people comment about PE just being banking 2.0 or whatever, but how many others actually had a significantly worse experience in their PE gig? I'm a year in (MM NYC) and feel like my quality of life is significantly worse than at the one-year mark in banking (and nevermind compared to if I had stayed on as associate).
In terms of work content, I don't think I really find investing any more interesting than banking. Anything can get monotonous when you iterate on 50+ versions of it. I do find the work a bit more challenging, but not exactly in a fulfilling way. Instead of alphabetizing logos or making bar charts, I'm writing some convoluted SUMIFS formula on some data pull or troubleshooting 20 data tables after I've reworked a formula that no longer has X as a simple input. If you ask me which I'd rather be doing at 2AM while counting down hours of sleep, it's the mindless monkey shit for sure.
Hours wise, I really struggle with the lumpiness of deal sprints. Maybe some people prefer it for "visibility," but I think losing like 6-8 weekends in a row is brutal for my mental health, not to mention you could go 10 or 15 weeks sometimes if you're on a particularly shitty deal or back-to-backs. So far, it's felt like I'm on a deal sprint more often than I'm not, so it's been a pretty consistent 80-100 hours a week. And once you have PortCo's at a MM firm, there's no real "non-deal mode" 50-60 hours type stuff. Realistically I definitely had bad and very bad weeks in banking sprinkled in but I wasn't working more than 70-80 regularly.
Culturally, I feel like I'm consistently walking on eggshells. In my banking role, the junior bullpen all hated their jobs, laughed about it, and commiserated. I feel like my current firm doesn't have any room for that since it's heavily career track and everyone views it as their long-term future. I know the saying is to never become friends with coworkers so maybe I'm naive, but I feel my interpersonal relationships in IB were far stronger than now. Talking to anyone above you here is just top tier schmoozing and absolutely ZERO pushback. I imagine IB gets more cutthroat too at the higher levels where promotion becomes tougher, but at least in my group the threshold for promotions seemed relatively attainable without becoming a different person entirely.
Which brings me to - there's a particular intensity to PE that I was ill-prepared for. It feels like you have to *care* so much more than in IB. This makes sense in that PE work is higher-stakes at an individual level, but it definitely feels like it isn't for everybody. I don't feel like I've ever been a slow worker - quite the opposite even - but it feels like I'm always behind or not hitting the team's expectations. I'm actually not even sure if I'm fucking things up (no one has really indicated as such), or just that they regularly operate at a higher level of micromanagement than I'm used to. Personally, I do truly feel I'm working pretty close to my max capability given my level of *give a fuck*. Admittedly I've always been going through the motions a bit with work (I don't ever think I can be that guy that throws himself into the job entirely), but where I succeeded in spite of that mentality in IB, it might be causing my downfall in PE.
Maybe I was particularly lucky in banking and somewhat unlucky in PE (which I'm trying to gauge from this question). Banking was tough but I was decently respected and had a manager that at least somewhat tried to reduce weekend work, manage timelines, and stay mildly receptive to feedback / input. I guess also given the constant turnover and average tenure in banking, it became easier to build a reputation over shorter periods (and subsequently get more trust / freedom). It might also be worth mentioning that the general "prestige" of my PE firm is marginally higher than my former bank so maybe that's where I went wrong. Most of my coworkers are from better banking programs, so culture may just be representative of those firms.
Finally, I think I was a bit more tolerant of the BS at 22 than I am at 25. Maybe if I could reset my brain to my fresh college grad self, I could put up with more of the lack of control and respect. I knew I was going back to the bottom of the totem pole, but didn't expect to reset as much on softer skills side. I've tried to look for more objectivity by comparing to my analyst experience given that establishing human capital is natural. But at the same time, you'd want the experience and years to count for something.
Unfortunately I guess there isn't much point to this post, but just curious if others are in the same boat. I do have quite a few friends at other firms who don't seem to be having the same experience. Realistically I know my PE stint will be relatively short, and though banking was somewhat better for me, chances are I move on from the general industry entirely. I guess misery just loves company and I'd feel better knowing it's not just me that got duped into thinking PE was some kind of promised land.
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Feels kinda relevant to this thread, but FWIW I’ve been evaluating returning back to the sell-side for a couple years now. I miss the reliability & career path of it all; not to mention I didn’t hate the client work - I hated some of the bosses that screamed rapid turnarounds when, now, as a mid-level / early senior, I see how much wiggle room there really is in timeline deliverables.
Not to mention, I have friends who stuck it out and are VP/Directors now from lmm+ banking who have magnitudes more saved up than me & make 2-3x my annual cash comp annually (even in this rougher deal environment). My carry isn’t even real for 5-7 years. And I’ve been at several firms at this point.
I would never join a sweat shop on the sell side, ever, but if there was an interesting role with solid comp & trajectory, that got me home at my current 5-8pm daily timetable outside of sprints….I’d consider it heavily. FWIW, That 5-8pm excludes heavy deal work periods where even if I head home, I’m grinding 70-90 hours a week or more to close.
Identical experience to my PE firm when I was associate. Much more buttoned up, intense, detailed, and you have to fit in a country club-like way to get treated close to an equal instead of the help
Wow, felt like I was reading my own thoughts. This was a cathartic read as a second year buy side Associate. You’re not alone man..
1.5 year into my association stint at a LMM firm and my experience has been exactly the same. Once I get my bonus, think I'm going to recruit to go back to banking. More money, less hours. Just trying to maximize my own ROI at this point
I feel like reading my own thoughts - exactly what I’ve been telling my friends. I was at a mid-tier IB but had a good experience - hours were bad but the people were genuinely caring. I got great deal experiences and was well liked by the seniors. I am now at a MM fund and while life is ok, I feel much less optimistic about the prospect. In banking I had a lot of visibility for promotion (I was told by the seniors that I’m in the pipeline for VP when I was just an analyst) but at my current PE shop, I’m not even sure about promotion to senior associate let alone VP/principals. Nobody above VP leaves the firm (Im pretty sure some want to but they can’t find what they want) and spots are limited by fundraising. Cash comps are lower than banking across levels. Yes we all get carry (associates get a small amount) but a few years before it starts vesting and then a few years till fully vested - so to me the carry doesn’t mean anything when I apply my own discount rate. A principal told me once (when he was tipsy) that he’s been here for 5 years and have not seen a dime of carry.
I think work is still more interesting as I enjoy commercial diligence but most of the time it’s about tweaking the model to do whatever to get a 3x / 25% case and then dealing with portfolio issues later. What I’m not sure about is if it’s just a junior experience and if life feels very different once you become a senior that you will really feel you are driving things / building businesses / partnering with management. If any VP+ has thoughts to share I’d appreciate..
Xx
I went through this exact same realization (can check my past posts for reference!) and unfortunately I think this is the norm for a lot of people. If you aren't driven by prestige, money, or a genuine true interest in investing, it's hard to find your PE job fulfilling.
After going through 2 years of BS in banking and convincing yourself PE will be better, finding out you have to have the same level of neuroticism to succeed is a tough reality. Plus, as you note, people care so much more in PE that there is no collective 'this sucks' attitude that breeds camaraderie. Everyone there has a ton of comp at stake or are locked into their carry path. In some ways, they've chosen PE as their life and molded everything else around that, whereas after banking I was ready to not be a 'job guy' anymore.
I was planning on leaving the industry after my associate stint since, despite good reviews, I shared the same attitude you did and felt it would eventually either mean I wouldn't care enough to make it as a VP / above or I'd burnout (likely sooner than the former). Ended up getting a job offer somewhere else and left during my second year. No one understood at the firm why I was leaving PE for a lower paying job in my dream industry with better WLB, but that made me more confident I was making the right choice.
TL;DR: people go into banking for a variety of reasons, but most people in PE are planning on being lifers, so it's hard to go through the motions and that causes people to burnout quite faster than IB
Largely agree with the sentiments expressed here and I think the issue people have (or at least I have) going into this job was that it was a step up and endgame from IB in terms of thoughtfulness of work, comp, responsibilities and skills developed, better WLB (at least marginally), etc. For me anyway, it’s generally been the opposite - pay cut in compensation, worse hours on leaner teams, and generally similar amounts of mind numbing work at banking. It is more critical work generally but instead of building a CIM I’m managing other admin tasks for my portcos or formatting market maps, etc.
What disillusioned me is seeing how you have to grind even as a mid level and your stress doesn’t go away or magically get fixed, it gets even worse as your rep is based on the deals you close or don’t pursue. Partners may have more free time but they’re still always on calls, managing portcos, etc.
If you love all that and love the job itself then its a great gig and I don’t want to come off entirely negative as you develop a strong skill set and get to interact with high level executives as a junior. That being said, in order for the math to work out for carry you have to work your way up in often political and poor culture environments, and then stay at a firm long enough to realize that carry (multiple years). If you’re driven by money or love the job, then the cost is worth but if it’s neither like it is for me, makes it easier to walk away.
Very much agree on mind numbing shit. Tbh I may spend more time formatting stuff now than I did in banking.
All absolutely hilarious because 98% of it is strictly internal unless it’s a specific PortCo task or lender stuff. I understand for IC and high stakes deliverables. But I was mindblown the first time I was told “partner wants to see this quick analysis on customers” and it required like 3 turns of formatting nits (number formatting & dollar signs, summation lines vs an indent, adding a line between columns, etc.) I remember in banking even if it was my director, I could just send a raw data Excel or screen grab for something so elementary.
Your last line also resonated. To an extent I’m grateful because prior to PE, I might’ve been one of those who wrongfully stuck around whether it was due to comp or prestige or just inertia. Seeing the reality of this side, at least I’ll feel absolutely confident in my decision to leave.
Also, from what I've observed, folks who enjoy their PE associate experiences relative to IB all had trash IB experiences. They needed it to be that bad (from a starting point) to enjoy PE.
If you had a mildly good (or above) banking experience, chances are PE will feel like a downgrade.
I made a similar post addressing PE issues recently. See my post here https://www.wallstreetoasis.com/comment/3154943#comment-3154943 (also pasted below). In my experience, your sentiments hit home for the majority of ppl who go the PE route.
PE as a longer-term career is vastly overrated and not a good decision for the long-haul, which shocks many. I do think there is merit in associate years because the learning vs. banking is significant and opens up a lot of doors. The problem is a lot of undergrads and bankers have been gaslighted into thinking that PE is the long-term career path way to go. The following are just a subset of issues that are not discussed often enough about PE:
1) The big $ in PE that pays off vs. other finance paths will not be made unless you stay with a fund for >10 years. This is the case at >90% of funds. IMPORTANT: this requires you find a fund that is tolerable and that you can reasonable stay at for that duration plus one that you play the corporate politics well-enough for the more senior seats. Hint - this is extremely hard to find.
2) The work is mind-numbing after you do your first couple of deals. Once you learn the game, combing the data room and modeling out false precision becomes unbearable. Most folks cannot say they enjoy sourcing with a straight face and view it as a necessary evil.
3) PE is banking 2.0 narrative is absolutely correct. You are trying to do deals and accumulate AUM. Firms will claim they are not and that "trying to stay small" but they are trying to do as many deals that their LPs will allow within their strategy, regardless of forward returns. Don't be fooled. If you want to do investing, go to public markets.
4) It's incredibly hard ex ante to pick which firm you want to be at since you're dealing with very smart folks who all know the right things to say. Weight that against the fact it's hard to get more than 1 solid PE offer and you're left making a less than ideal choice if you want to do PE. Try to speak with former associates/VPs if possible, they are likely the only ppl who will give you a straight answer.
5) Last, reverting to my point #1, if you want this path to make sense, you have to suck it up and deal with all this BS for ten years at the same fund without going crazy and ruining your personal life, knowing that if you decide to leave, it's a negative NPV decision due to the way the carry vesting works.
In summary, the narrative around PE needs to change. This is a mature industry where it's incredibly hard to get 1) a seat at a good fund and 2) a seat that you have staying power at that makes the sacrifices worth it.
I left PE earlier this year and your post is relatable. The work was generally fine and my hours were fine, but the culture and energy was awful. I got dragged over the coals during my time in banking but I made some of my best friends and still talk to various of my coworkers. I appreciate that that isn't a 'normal' job experience, but at my PE firm the culture hovered between bad and non-existent (and I took a pay cut). A few friends from banking left PE for similar reasons — one of them went back to banking after a year.
Everyone Sr. Assc and up sat in their offices and the associates were in the open area. We all (associates, office services, IT, the comms team, etc.) generally wore headphones and it wasn't abnormal to message people who were 15 feet away from you instead of walking over to them. I think in my 2 years me and the other associates got drinks after work 2x. Our holiday party was a 2-hour luncheon. Pretty much any chit chat during meetings was about a) work, b) sports, c) someone’s children, or d) someone’s children’s sports (my co-workers in banking also all had kids).
Agreed on the intensity. Everyone else was super bought in — for obvious reasons ($) — and it felt like I cared about my /job/ and they genuinely cared about what the issue at hand was. I don’t think we ever commiserated like “this sucks!” If you joked around on Teams it would normally be left on read. Basically, it was an intense job with no connection to your coworkers. Most of my coworkers had also been working together for a very long time (it was a small team) so I felt like I was sort of on the outskirts.
Professional development was also pretty bad imo. It was rarely explained clearly what was expected of me (at my level, not specific tasks I mean) and feedback was hard to come by. In banking we got a ton of feedback, expectations were clearly set and it felt like people genuinely wanted you to grow. When I was in PE my VP borderline refused to give feedback then dumped it all in your review. It felt more like you were supposed to just know what you needed to be doing to step up without any input.
I work on a Corp Dev team now and my team + the firm I work at both have a good culture. When I’m in the office there are people sitting around and talking, I’ve been out to drinks with co-workers several times, they have interesting events and stuff. Obviously didn’t expect all of that in PE, but it’s made me realize I missed camaraderie. It’s a lot of small stuff. During calls me and my Sr. Manager message each other on Teams cracking jokes. One of my directors was telling everyone about the Taylor Swift concert she went to on our team meeting, and when I started they asked me to un-blur my background so they could see my dogs.
This was a long rant, but I guess the takeaway is PE can be a very good job and there are probably some firms with awesome culture out there, but by and large it’s a much more staid environment and having ‘fun’ at work is less common.