Contemplating job opportunity
Currently an acquisitions analyst at an institutional shop (all property types) and contemplating a transition to the GP side focusing on multifamily as I’ve been presented with an associate role at a smaller firm (<$1Bn AUM).
Deal flow is minimal at my current firm and will be for the foreseeable future, but I like my coworkers and enjoy the perks the company offers, such as trips, benefits, and a good work-life balance at the moment.
At the GP, they seem to be active in the middle market space and I will take on a bigger role in the acquisition process and have more autonomy with some support. Long term, I have entrepreneurial endeavors in residential RE that I would like to pursue, and this position may help me gain that skillset.
Considering the stability of my current position and the uncertain conditions of both the CRE and job market, I'm somewhat hesitant about transitioning to a new role at this time, especially at a smaller firm.
Has anyone had experience changing jobs recently or going from a bigger to smaller company early in their career? I am grateful to be in this situation and would appreciate any insights or advice.
I think moving to the GP seems more in line with your long term goals but need more details to give you a better answer:
I appreciate your response. To answer your questions:
They source their equity from established relationships with HNWIs and a few institutions. They mentioned their recent closing with private capital was oversubscribed.
If they are continuing to grow AUM even in this environment and not having deployment issues then I think you'll be fine
Who will be your direct boss? Ideally want to be very close to the decision maker at these smaller shops. If you are too far removed I'd be slightly hesitant because it would be harder to move up.
Assuming not much opportunity to move up at the current shop and you are getting compensated appropriately at the new place I would make the move. Gets you more deal reps and closer to the deals.
Always risk in this industry so why not swing for the fence? Sounds like a promo to a more active shop. If they have been doing deals the last 6 months I don’t see why you wouldn’t jump. You can always make you way back to where you are. Gonna be lay off risk anywhere you are at in this market. Wouldn’t count on your current gig being safe if they aren’t doing deals… Definitely ask some hard questions around hnw capital and figure out how reliable it is. But if they have a fund raised and commitments then pretty low risk imo.
Based on the most helpful WSO content, making a transition from a larger to a smaller firm early in your career can be a strategic move, especially if it aligns with your long-term goals. Here are some insights and advice drawn from similar discussions:
Increased Responsibility and Learning Opportunities: Moving to a smaller firm, like the GP side focusing on multifamily, often means taking on a broader range of responsibilities. This can accelerate your learning curve and provide you with a more hands-on experience in the acquisition process, which seems to align with your entrepreneurial ambitions in residential real estate.
Entrepreneurial Skill Development: Smaller firms can offer a closer look at the entrepreneurial aspects of real estate, providing valuable insights and skills that are beneficial for anyone looking to start their own venture in the future. The autonomy and significant role in acquisitions at the GP might be exactly what you need to prepare for your long-term goals.
Consider the Trade-offs: While the smaller firm offers more autonomy and a potentially richer learning experience, it's important to weigh these benefits against the perks and stability of your current position. The trips, benefits, and work-life balance you currently enjoy are significant factors to consider, especially in uncertain market conditions.
Networking and Mentorship: Before making a decision, try to find a mentor or industry professional who has made a similar transition. Their insights could be invaluable in helping you weigh the pros and cons. Additionally, networking within both your current and potential future sectors could provide more clarity and possibly open up other opportunities.
Market Conditions and Firm Stability: Given the uncertain conditions of both the CRE and job market, thoroughly research the financial stability and market position of the smaller firm. A firm with a solid track record and a clear growth strategy, even if smaller, can offer a secure stepping stone for your career and entrepreneurial endeavors.
In summary, transitioning to a smaller firm can offer significant growth opportunities and align with your long-term entrepreneurial goals. However, it's crucial to carefully consider the trade-offs, seek advice from mentors, and assess the stability and growth prospects of the smaller firm before making your decision.
Sources: When to jump - Advice on switching jobs, careers, and fields, When to jump - Advice on switching jobs, careers, and fields, Took an Associate job at a tiny firm, how screwed am I?, Q&A: I grew up in Consulting and reinvented my brand 3 times, People who fall off the map professionally
Honestly I would probably stay put for now if I were you. It sounds like you're at a larger, well-capitalized firm where you job security will be significantly greater than moving over to an entrepreneurial GP. Most of the layoffs that I have seen in the last 12 months have been at smaller to mid sized developers, sponsors, and other owner/operators, and much less so on the institutional investor side. If you're dead set on 1) multifamily and 2) being on the operator side and nothing else for your career, then perhaps you can stomach this risk, but I just want to throw this out there as a very relevant and considerable risk to think about.
If your firm is looking at all product types, why is your transaction volume down so much? I work at an institutional investment firm where we cover all product types within the CRE universe, and there's certainly no shortage of dealflow. In certain product types, yes, but definitely not across the board.
If I were to guess, OP may be at a shop that says they are product type agnostic, but most of their capital and experience in recent years has been focused on one product type / return threshold. I work at an operator that says they are product type agnostic, but has done office almost exclusively for a decade and our discretionary capital is value add / opportunistic, so transaction volume has been near zero the last 3 years.
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