Am I screwing myself or perfecting my craft?

First post here, cheers. As the title shows I am unsure of the position I am in and its outlook.  
 

Currently at a very small REI firm in big city and been at the firm for almost two years. The company is extremely small where there are two associates and then the partners. My role (1/2 associates) is to take care of all things in the firm - all things from acquisition through development to asset management. I get a little help from the partners in development and we have a property management company within. The remaining arms are outsourced to a third party company we pay (attorneys, accounting, architecture, etc.) all of which I coordinate with and completely run too. In simplest terms it feels as I am running and pushing the entire firm myself and its direction is in my hands (the other associate is in their family and is practically useless). The partners are serial entrepreneurs and extremely successful with high net worths really at a young age (30s/40s). They are great mentors to learn from and illustrate why they reached that level of success. But, in turn, replicates why they put so much faith in me to drive the firm forward and practically run it myself with their busy schedules. 

Not to hype myself up - truly do work my ass off and drive the company forward. The firm has made tremendous strides since I joined and it gives me more confidence to start my own firm when I decide. But am I holding myself back with the structure or size of the firm? Should I seek larger firms that have more complexities and I’m sure slightly better pay? If I was to exit this no name firm, would there be exit opps? 
 

Regardless I’ll lay out the pros and cons with the current role:

Pros:

The firm is great with fair hours, fair pay, and good deal flow (partners are very liquid). I get to do all things in the firm and truly understand all aspects of what it is to own/run a REI firm, not just a specific arm. Also, the partners respect and incorporate what I say or think. Everyone is friendly, I enjoy the job, proud to say what I do, and have an opportunity to be given a small percentage of properties profits as a junior partner in the coming years.

Cons:

For starters: I don’t have anyone to compare myself to except the partners, small firm with little structure, organization issues (at times). The partners also have minimal REI experience and are NOT vets in the game - they created their wealth in other industries and now want to dump it in REI and created this firm. Rely on me heavily for acquisitions and know I am maximizing all subsidies or financing available - but they do know their shit, not hard in RE. Small, Only midsize properties: average 20 units. Not difficult financing or complex deals. It feels like a lot to carry and I would like to know if I am making the right choice by staying. Obviously no corporate scene with events or dinners, etc. and no coworkers to collaborate with or even get lunch with - it is what it is, not a dealbreaker being a loner.

To me this seems like a dream role as I get to understand how to manage and run a REI firm while risking someone else’s dollar, before I start my own. The old me would think I’m crazy for even debating this. But now Im questioning if this is the best route for my career. In logical terms I didn’t screw myself but it may be more difficult to find exit ops from a no name firm.  I could see how if I focus solely on development or acquisitions, I already understand the other processes and could fine tune my skills in either one to better prep myself for my own firm.

But from and outsiders view —am I holding myself back by staying at this firm? Should I seek larger firms that have more complexities and I’m sure slightly better pay? Should I seek more complexities elsewhere for better experience?

Any genuine advice is greatly appreciated here.

Cheers chimps

Most Helpful

If your goal is to do your own investments/development one day then this role sounds perfect to teaching you everything you need to know about real estate. There are very few roles that provide you the depth and breadth of responsibilities that you are getting. If you are truly spearheading everything from acquisitions, financing, development etc...then you are definitely perfecting your craft. Believe me when I say that analysts, associates, dev managers, and even VP's at Tishman aren't getting the depth nor breadth of experience that you are getting and even if they are, the projects they are working on are so large that it is essentially irrelevant if they want to do their own developments because realistically none of them will be developing 500+ units on their own.

However, I do understand that there may be limitations to your career given the size of the firm. Since you are only a 2nd year analyst, I assume you are pretty early in your career, so if you feel like you may be limited at this firm, my advice would be to get the best of both worlds. Work at this smaller shop for a couple of years and spearhead projects from cradle to grave. Once you think that you pretty much mastered the job and things are getting repetitive, then lateral to a larger, more institutional shop to gain that pedigree because there is value to having Tishman/Blackstone on your resume vs XYZ mom&pop shop when it comes to raising capital. However, I must warn you that by lateraling to a more institutional shop there are 2 down sides

1.) You may take a minor title cut. Hypothetically if you had worked at an institutional shop for 3-5 years, then you would probably be a dev manager at an institutional developer or associate/senior associate at an REPE shop, but since you came from a small shop, you will likely lateral to a larger shop as a dev associate or investment analyst. But in my opinion this is a minor setback because probably after 1-2 year you'll get promoted to those titles and the experience you are getting now is definitely worth this setback

2.) The 2nd downside is, in my opinion, much more severe and it is the fact that your job and responsibility will be completely different. Right now, you run the show and you have almost full autonomy. Everything you do matters and since you are at a small shop with limited man power, you have to prioritize the most important tasks. So for example if you were to build a model for an acquisition or development, you will probably build one that is "good enough" for all intents and purposes instead of spending hours delving into every detail of the model trying to squeeze every bps of return. But at a large shop with more team members, you as an analyst/associate go from running the show and spearheading important task to an excel/ppt monkey. Your responsibilities may become mind-numbing and sucks the soul out of you everyday you go to work. This is what happened to me and is why I left my previous job at an institutional developer. I came from a background similar to yours where I worked on smaller projects (3 - 50 units) and I had a lot more responsibility and everything I did mattered, but when I went to the larger developer, my responsibilities were fucking mind-numbing. I hated waking up everyday doing some bullshit work. Working at a smaller shop spoiled me. If I had worked for a larger developer fresh out of college when I was eager to learn how to build perfect financial models and powerpoints and work on the largest developments in the city, then I would have felt very fulfilled with the bullshit work. But after working for a smaller developer and realizing what work actually matters, it was very difficult for me to go back and do mindless bullshit

But anyways, maybe you work at your current job for a couple more years and before leaving to an institutional shop, talk to the partners about your potential growth at the company. Maybe you can start getting carry and perhaps there is a pathway to becoming a partner one day. Sometimes you can actually make more money at these smaller shop than the larger ones and honestly...money is all that matters

I also wanted to add that there doesn't always need to be a path or road to promotion. If you manage the full development process of 20-50 unit project, then not only do you master this skill set, but you will gain knowledge on sourcing deals. A lot of people on this website think raising capital and millions of dollars automatically means that they have a successful company/fund...but realistically if you were to give 99% of users on WSO $10mm or even less...they wouldn't know what to do with it. But by seeing the ins and outs of many projects and seeing what works and doesn't work then you can begin to create an investment strategy and are able to identify good projects/investments. For the last 30 years my family only developed single families and duplexes. After I joined we started moving to larger and larger projects - developing 3 units, 5 units, entitling land etc... Each time we did a "new" type of project, I learned a new strategy to make money. It's like adding a new tool to my toolbox. I recently successfully entitled a 3 unit property to 5 units. Now on top of searching for single and duplex development projects, I am also searching for properties that I think I can entitle 5-20 units because now i have that experience. Similarly for you, by managing so many projects, each project will teach you a new way to make money. You can then use this knowledge when you look for investments/development projects. This is important because now that you know what you are looking for, you can then begin sourcing deals for your partners making you that much more valuable. Eventually if you are confident enough, you can break off and start your own development/investment firm and raise capital from your partners. I know one developer who worked at a midsized REPE shop. Eventually he left them to start his own development shop and guess who his initial investors were? The REPE shop that he worked for.

I don't think you're screwing yourself over since it's only been two years. I think your current role sounds super valuable but you really need to consider where you want to be in 4-5 years from now and if what you're doing fits with that goal.

I'm in a similar role as yours with a couple more years of experience, going for a more institutional role has been thought of mine but being able to run my own operation is what attracts me to it, is the less corporate culture, the quicker nature of deals, less capital needed. the lack of relationships with LPs keeps me from actually doing it.

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