Open End Fund VPs
I am currently in discussions for a VP acquisitions role at an open end fund. Due to the open fund nature, these funds may not offer any form of carry, however I presume in order to retain each firm’s rockstar employees it is not solely a base salary and bonus comp package. I have heard of general comments of potential long term additional incentive plans through a couple of colleagues I have spoken to in the industry. Perhaps it is a milestone additional cash bonus if you hit certain hurdles in number of deals, etc.
For those who operate in the open end fund space, how is your general compensation package structured?
A lot of open-ended funds have crystalization events at regular periods based on some predetermined value of the assets. This is how my carry is structured in our core fund.
Some companies have corproate level long term incentive plans to compensate. My old firm's LTIP was a 3 year vest/payment schedule. So you could crystalize something every year once you hit year 3.
Varies from company to company. Carry in it's actual meaning isn't a thing at larger shops, due to the complicated legal nature of having multiple people legally having "carried interest" in a fund/deal. I usually see it at smaller operator where there's like 5 people involved in the fund. At larger shops, folks will get a LTIP (long term incentive plan) that'll allign their interests to stay at the firm for longer. That being said, I'm sure if you're Jon Gray at BX (or any top 5-10 employees at similar shop), you'll have carry in its true meaning of the word, but those are far and few in between. Usually LTIP conversations begin when youre 5-7 years into the industry or firm you're at. Bonus + Base + LTIP (Annually, LTIP can be anywhere from 25% to xxx% of Base+Bonus... - really depends on what you bring to the team). Payout of LTIP could range from 3-7 years, really depends.
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