“High” Comp in Venture Capital
I’ve been reading on different posts that total compensation in VC is higher than IB (or even Buyout/Growth). At what point is this true? It seems like from analyst to principals (pre-partner), VC would pay you significantly less than IB. How much of expected carry can you get in VC?
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Based on the most helpful WSO content, it's important to note that compensation in Venture Capital (VC) can vary widely and is often tied to the performance of the fund. This is different from Investment Banking (IB) where compensation is more structured and less dependent on fund performance.
In VC, a significant portion of your compensation could come from carried interest, or "carry", which is a share of the profits of the fund. However, this is a long-term play and can be quite risky, as it depends on the success of the startups in the portfolio.
As for the specific amount of expected carry in VC, it's hard to provide a definitive answer as it can vary greatly depending on the fund size, the success of the investments, and your position within the firm.
Remember, while VC can potentially offer high rewards, it also comes with its own set of risks and challenges. It's a different ball game from IB or Private Equity, and it's important to consider these differences when making career decisions.
Sources: Breakdown of Post-IB Exit Opportunities, Q&A: European PE professional at a Large-cap Megafund, Vice President Fund Carry/Equity, Expected carry compensation at senior associate/VP level?
Junior comp in VC is not higher than PE or banking. In fact, at most firms it's considerably lower. But the lifestyle is much better.
At senior levels, it's highly performance based since much of your comp should be based on carry. So yes, it's possible to make much more than peers in other industries if you're really good. But generally speaking, PE and hedge funds will comp higher than VC, mainly because fund sizes are significantly larger in those fields.
yeah will echo the above. Usually VC comp at the analyst t/ associate / principal level is gonna be lower than PE / Growth/ banking
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Analyst 1 here at a VC. Make 120 base. Know associates get carry
Fresh out of UG? Sounds really good
:)
Just like the Lyft CFO, fat fingered an extra 0
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