Sales at BB vs IR at Apollo/KKR/Ares

Based on the most helpful WSO content, here's how the long-term compensation comparison between Sales at a Bulge Bracket (BB) and Investor Relations (IR) at top private equity firms like Apollo, KKR, or Ares stacks up:

1. Sales at a BB (S&T):

   • Compensation in Sales & Trading (S&T) is competitive but slightly lower than Investment Banking (IB) at the analyst level. First-year analysts in S&T can expect around $120k, with significant increases as they move up the ladder.
   • Managing Directors in S&T can earn between $500k and $1M, with top performers potentially exceeding this range. However, top performers are becoming rarer in S&T.
   • Bonuses make up a significant portion of total compensation, especially at the VP level and above.

2. IR at Apollo/KKR/Ares:

   • Compensation in IR varies widely depending on the firm, region, and individual performance. For example, seasoned IR professionals at $1B funds might make $150k/year, while others at larger funds with successful fundraising years can clear $500k/year, including a significant percentage of the capital raised.
   • Some IR roles also offer carried interest, which can significantly boost long-term earnings, especially at senior levels.
   • Long-term upward mobility in IR/BD can lead to senior-level positions with lucrative compensation packages, including a share of carry.

Long-Term Comparison:

• Sales at BB: Offers a more predictable compensation trajectory, with high earners reaching $500k-$1M+ as MDs. However, the ceiling for top performers in S&T is generally lower than in IR at elite PE firms.
• IR at Apollo/KKR/Ares: While IR compensation can start lower, the potential for carried interest and performance-based bonuses during fundraising years can lead to higher long-term earnings, especially at senior levels. The variability in compensation is higher, but the upside can be substantial.

Key Considerations:

• Work-Life Balance (WLB): Sales at BB benefits from market hours, offering better WLB compared to IR, which can involve long hours, especially during fundraising periods.
• Interest in Work: Sales may be more dynamic and market-driven, while IR involves relationship management, fundraising, and business development, which some find less intellectually stimulating.

In summary, IR at top PE firms like Apollo, KKR, or Ares has the potential for higher long-term earnings due to carried interest and performance-based bonuses, but it comes with more variability and potentially worse WLB compared to Sales at a BB.

Sources: Sales and Trading - A Comprehensive Guide, what's IR / capital formations like?, Why I Left PE & Switched to the Public Markets, Thoughts on Investor Relations? A good or bad move?