anyone else find their PE job boring?

theoffice's picture
Rank: Chimp | 2

Anyone else bored by their PE job? After two years of banking, PE was supposed to be the golden ticket - but now that I'm a year in, more often than not I'm bored as hell. I started at a large nyc-based PE firm last year after two years at a BB.

I once spent a few weeks on a bond desk and sometimes I wonder whether a job closer to the markets (S&T, actively trading HF) would be more up my alley - more action and pressure and rapid decision making. PE is mostly repetitive lbo analysis and diligence work with 1-2 deals per year and a long runway to a senior decision-making position.

Even the idea of sitting on a rowdy trading desk seems far more appealing than sitting alone in my office listening to the air conditioning. I'd be willing to sacrifice some comp to have a job that gets my blood pumping a bit and that I'm passionate about. My shop sometimes promotes associates but I might be looking for a job anyways in a year.

Anyone ever heard of someone leaving PE to go directly to sales/trading on the sell-side or a HF role thats close to the markets? Do you think an mba at wharton/chicago etc. would be the best transition?

Region: 
United States - Midwest
United States - Northeast

Comments (29)

Jan 29, 2010

the grass is always greener...

my previous employer gave me that warning before i left

Jan 29, 2010

^ yup, he's right.
Try consulting, then. It will take you to some exotic places with bad food.

Jan 29, 2010

I too share your sentiments theoffice... personally, I find PE too boring and "hands-on" for my liking / personality. I haven't been in a year and am already bored. Also, to date, I find that this "value-creation" pitch rather shallow - I think the only value that ex bankers add is maybe governance and deal doing... i really haven't seen much operational improvement so to speak (my firm doens't have any operational consultants)... and like you - i ama long way off from senior decision making... sometimes it feels like i have made a mistake...

Apr 24, 2013

[x]

Jan 29, 2010

Totally agree... even from the debt side of the PE picture, it gets tiring hearing the same bullshit, reading the same decks and running the same diligence process over and over... the steps never change, the models are always boring as fuck to make and it all gets stuck in some memo no one ever really reads but has tons of opinions on... I'd love to spend my days schmoozing like an MD and getting on calls, but until then I've got to keep repeating the same ridiculous cycle with a min. of 60hrs/wk.

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Jan 29, 2010

Tech Buyout went from well, Tech Buyout, to a HF role. Its funny though, grass is always greener because I'm at a HF, albeit a small one, and am more interested in the private side due to the operational experience I hope to gain, not really passionate about the markets, there's just too much noise on the public side...

Jan 29, 2010

This kind of goes back to a post I made about finding what truly interests you (haha needless to say there weren't many responses). I feel like I constantly chase these things and get myself psyched on the glamorous aspects of them. Buy-side investing, trading, private equity. Now, I was not in quite the position that you are, as I am just in my first year. I just wonder...when do you stop chasing prestige and settle into what interests you. And even then, will it be that enjoyable? Or will you constantly be thinking about alternative options.

Who knows.

Mar 11, 2010

This whole thread has really touched me. It's so honest.

I'm in my final year at university. I did an internship in IBD at a BB. I hated it, but after not landing a job at Bain (got to final interview, got nervous, fucked up my maths) I'm now going back to the BB in July. These last few months, I've tried to get motivated, focusing on my 50k starting salary - more than anyone in my family has ever earned - and telling myself that it's just 2 years then I can go into a PE or a HF, or telling myself that it's a good way to get the money to start my own business.

By the sounds of it, PE, like banking, relies on money and prestige. When you have both of those things, I imagine you just envy the happy guy who owns his own bar. Maybe bankers don't burn out, they just get some perspective..

Jan 29, 2010

A couple questions/comments for you:

1) Do you prefer your current role over your time during the IB stint?

2) It seems PE consists of a wide range of functions/industries/niches/etc... What area do you focus on? I've always thought emerging markets PE sounded very exciting. Film funds (yes, rare) also sound cool/unique.

Jan 29, 2010

Interesting post i've also wondered the same thing... transaction are such long and painful processes... I always wondered what it would be like to be on the market side, executing instant transactions with more of a high-paced lifestyle.

has anyone seen both sides and can comment. this would be especially helpful for those looking at exit options after IB stints.

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Jan 29, 2010

Havent seen the PE side, but I made the jump to IB from the buyside (HF/AM) after less than a year. I'll list some reasons below. Currently, my end goal is to get into a PE shop.

  1. I thought my personality fit in better with transactional-type work. Ya, I enjoy making decisions on the go and taking risks sometimes, but, I prefer to work on big, complex, and sometimes long projects that require lots of problem solving/deep analysis throughout.
  2. I'd like to have an impact on the things I place my money into. Cant really do that at an HF (unless you're an activitist investor).
  3. Plus, like SAC mentioned, too much noise in the market.

But, after thinking about it, I am aware that it could have been firm specific reasons that made me jump/dislike the market side of things (a bit disorganized, managing risk was less of a concern, shark-like culture, comp was good but not great, etc...). Not saying that I will never go back to a HF/AM, just thought IB offered a better skill set that I wanted to develop.

Jan 29, 2010

I made the jump from banking to VC, where exits take even longer. VC is arguably one of the more interesting fields however I'm so tired of waiting for brilliant technologies thought-up 10 years ago and have yet to turn cash flow positive. I actually miss banking a lot, where (aside from sell side mandates that drag on forever) you create instant value in M&A transactions, etc. Plus I loved having an analyst class you can chill with outside of work or at 3am in the morning. PE/VC is a lot more lonely (if you care about the social aspect).

Jan 29, 2010

very interesting conversation....BUMP

id like to add becoming an entrepreneur to the conversation.

its less structured. your ideas are what drive the firm. theres always some new challenge to consider. you have to think long term and short term. your leadership skills are stretched by managing strategy and personnel. your skill set ranges across all functions. it is by far the most stimulating job, ive ever had (my WE = bulge banking and trading, small biz consulting).

its not all a bed of roses however. unlike consulting, the ultimate task is your responsibility and you never have a day off. plus, there is a tremendous amount of risk involved that may not produce any monetary reward. unlike other people's money in trading or banking this is squarely on your shoulders. moreover, you typically have to soldier through years of VC/PE/HF/IB work in order to amass the contacts and funds to create something significant (tho you could just be like me and go small business!).

anyway, i guess what im saying is i think setting yourself up to eventually create something is the way to go if youre constantly bored.

Jan 31, 2010

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Jan 31, 2010

Believe it or not I find my PE job pretty exciting. There are certainly bouts of boredom and I am still in my first year, but I try not to fall victim to the "grass is always greener." I talk to my friends and almost all of them hate their jobs. I even know someone who works in the video game industry making video games and he is looking to get out. No one ever seems satisfied with their jobs. I actually think that PE is pretty exciting. Traveling to other cities/countries, meeting successful business people, and learning about all sorts of different types of industries. Outside of being a professional athlete, I'd say we've all got it pretty good.

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Jan 31, 2010
CompBanker:

Believe it or not I find my PE job pretty exciting. There are certainly bouts of boredom and I am still in my first year, but I try not to fall victim to the "grass is always greener." I talk to my friends and almost all of them hate their jobs. I even know someone who works in the video game industry making video games and he is looking to get out. No one ever seems satisfied with their jobs. I actually think that PE is pretty exciting. Traveling to other cities/countries, meeting successful business people, and learning about all sorts of different types of industries. Outside of being a professional athlete, I'd say we've all got it pretty good.

I feel that this touches upon a common theme in our generation, a certain sense of entitlement that is very pervasive. I've also noticed that every single person I know seems to be so dissatisfied with their jobs and feels like they deserve to be a CEO calling the shots. It is my opinion that growing up in a land of plenty and without any experience of widespread military conflict or other turmoil has led to this phenomenon.

Feb 1, 2010
CompBanker:

I actually think that PE is pretty exciting. Traveling to other cities/countries, meeting successful business people, and learning about all sorts of different types of industries. Outside of being a professional athlete, I'd say we've all got it pretty good.

I totally agree. I've always been fascinated by people living on the socioeconomic fringe, whether they're homeless drug addicts or the uber-successful. One of the best parts of being in banking/PE IMO is having the opportunity to constantly be surrounded by some of the most successful people in the world.

Jan 31, 2010

I agree with Compbanker but it also depends on the firm you're at. My shop has given a great deal of responsibility to the junior folk so my time is not spent only on modeling and drafting internal memos. I've found it to be very interesting and pretty eye-opening from an overall operational and business-level perspective. Aside from learning a ton about industry, I've been able to pick up some interesting views/tools on deal negotiation, financial engineering, and value creation just from "being there" with the senior guys. It might not be something I want to do forever but it definitely helps to see the big picture and I think it's the same general theme across any industry.

Feb 3, 2010
HerSerendipity:

I agree with Compbanker but it also depends on the firm you're at. My shop has given a great deal of responsibility to the junior folk so my time is not spent only on modeling and drafting internal memos. I've found it to be very interesting and pretty eye-opening from an overall operational and business-level perspective. Aside from learning a ton about industry, I've been able to pick up some interesting views/tools on deal negotiation, financial engineering, and value creation just from "being there" with the senior guys. It might not be something I want to do forever but it definitely helps to see the big picture and I think it's the same general theme across any industry.

Interesting. This summer I was a SA, and after a meeting with a PE shop, my MD and VP were talking about how much it would suck to be an associate at a PE shop. Myself and the other summers thought that was ridiculous since we all were under the impression that PE was the "promise land". We didn't think there was any way being an associate at the PE firm could be worse than being a banking associate. But obviously there are pluses and minuses with everything, and a lot depends on the firm.

Compbanker and Serendipidy (this may be a dumb question, but I'm just trying to learn a little more)- do you think that the firms which focus a bit more on operational improvements with their portfolio companies tend to give their associates more interesting work than the firms which focus more on financial engineering? Also, are there firms out there that actually allow the associates to go and spend some time working with the companies (and learning about the ops) rather than having you sit on a model all day? I've always got the feeling that associates at megafunds spend just as much time staring at their comp screens as they did when they were banking analysts...

Feb 1, 2010

Don't know about anyone else...but, I just saw Avatar, and I'm not sure I'll ever find any job interesting after that. God damn.

Best Response
Feb 4, 2010

clb, here is a link to another thread where I talked about my PE responsibilities and also gave general advice about breaking in: //www.wallstreetoasis.com/forums/advice-for-new-anal...

Also, I've copy and pasted the one specific post that best answers your question below:

I won't go into too much detail, but the majority of my time is spent evaluating new deal opportunities (60%), and portfolio company management (25%). The remainder is internal initiatives whether it be recruiting, fundraising, quarterly reporting, etc. I also sometimes do meetings with bankers or other professionals that come through our office looking to offer their services. I'll give you an overview of evaluating new deals, as that should answer your question.

New Deal Opportunities:
The majority of new deals that come in house come through investment banks in the form of a nice, lengthy, overly-repetitive offering memorandum ("OM"). For every new deal that I'm assigned, I need to read the OM. At some point before initial indications are due, our team will get together and discuss the opportunity to decide if its worth pursuing. If we decide its worth pursuing, we will do additional research, run a basic LBO with very high level assumptions, pull together materials into a presentation to the rest of the organization, and sometimes get on the phone with the bankers to answer any clarifying questions. After enough of these, this becomes a fairly quick process. However, I usually have a number of new deals on my plate at any given time (I once had 3-4 OMs dropped on my desk in a single day). This is generally pretty fun though as you get to learn about a new company and industry without putting in much effort (the banker has compiled the whole thing nicely). If there is no banker in the process, you're doing your research from ground zero, and this generally takes much more time and produces less cohesive results, but it's more or less the same.

If the banker accepts our initial indication, myself and my deal team then go to meet with management and typically tour the facility. We are then given access to the company's dataroom with all sorts of data on the company -- data ranging from corporate minutes to detailed financials to tax returns. I'll sift through the entire datasite and try to learn as much as I can. This includes things such as reading customer contracts, evaluating operational metrics (backlog, efficiency stats, whatever -- it depends on the type of company), and of course, modeling the financials. Overall, modeling the financials is just one little piece within the broader picture. Also, during this time, our lawyers are generally marking up the stock purchase agreement. In conjunction with my team, I'm reading the stock purchase agreement and giving my feedback to the lawyers (usually our team will get together and discuss our feedback internally so we don't have multiple people giving conflicting feedback to the lawyers). In addition to dealing with the lawyers, I'm also on the phone with lenders trying to get them excited about the deal. We'll share our internal materials with them and they will have access to the datasite. Frequently they will barrage us with questions which we will either answer, or turn to the management team to answer if we don't know. While all this is going on, I'm preparing documentation for our deal team to present to the investment committee to gain approval to submit a letter of intent ("LOI") to acquire the company. If all goes well and everything checks out, we'll submit the LOI.

If the LOI is accepted by the banker, at this point we'll enter into exclusivity (aka force them to cut off all negotiations with other parties and work exclusively with us) and work towards completing our due diligence. This involves continued digging into the data, but also hiring a large number of third parties to conduct diligence on our behalf. Diligence areas typically include tax and accounting, legal review, an industry study, background checks on key members of management, a review of the company's IT system, insurance, and, depending on the type of company, an environmental review. Each of these areas of due diligence are conducted by a separate vendor, so it takes a lot of management to make sure everyone is getting the information and access that they need. Generally myself and an individual 1 level senior to me will do 100% of the management of the 3rd parties, and between the two of us, we both act as the point person for the different groups. I spend a lot of time going through the materials they produce, and at this stage of the deal, spend a LOT of time onsite at the company conducting my own diligence, overseeing 3rd party diligence, and just spending the time with management. Also, all the while, we're continuing to talk to lenders and I am putting together a final presentation, catered towards the lenders, to enable them to have a day on site with management and hear the story first hand. If all of this diligence goes over well, there are additional responsibilities involved in the closing (preparing the funds flow documentation, reviewing lender term sheets and credit agreements, finalizing the stock purchase agreement, etc. etc. etc.).

Obviously this is just a quick and dirty overview of the deal evaluation process, but as you can see, modeling, while very crucial, is not a major aspect of my job. Given I work in an extremely small and flat organization, I am generally the #1 or #2 guy responsible for all of the activities above. A good deal of the time I'm the only one on the phone with the 3rd parties, the bankers, or the lenders, and I simply report out to the team afterwards. Note that I am on multiple deals at once, though most of them are not extremely active, otherwise I'd be working around the clock.

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Feb 4, 2010

I won't reiterate everything that Compbanker just laid out but it sounds like we have very similar experiences. My shop has trended towards mostly acquisitions in the last few years, with very few divestitures. I'd say that since I've joined, I've worked probably worked 65% deal origination and 35% port management. I spend a good deal of my day talking to our management teams, operations people, etc.

As reiterated above a few times, it is really shop dependent. The deal teams at my firm tend to be one senior guy, one VP, and one associate; sometimes, one senior guy and one associate. I generally attend every meeting whether its with management or with the day-to-day operations team, the bankers, lawyers, etc. The closest comparable firm to ours (in size / investment strategy / etc) has barely visible associates. I've worked on 2 or 3 deals with them now and I have yet to meet an associate from that firm whether it's at a site visit or a strategy huddle up.

I can't really speak to megafunds but I hear they're pretty sweatshoppy.

Mar 1, 2010

Great forum topic.

What type of IB did you guys do (M&A / LevFin / Indusry-focused?), and how did your experience prepare you for this management-line role?

Also, do you plan to stay in PE for a long time or are you looking to exit to b-school and then pursue another career?

Mar 19, 2010

(Not related to the topic of the thread, but I couldn't help but notice the salary number you mentioned - isn't base, especially at a BB, about 70k right now? You said you were making 50k? Even with the higher number + bonus, after taxes and living expenses you'll hardly have the money to start your own business)

Apr 25, 2013

bump. Also curious about any responses to Futura's questions.

Apr 25, 2013

Curious here as well. Good thread.

Apr 26, 2013

+1 for CompBanker's comment. I love my job. Very challenging and get the opportunity to understand a bunch of different industries.

P.S. The deal flow process described above is spot on. Kudos.

Apr 28, 2013
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Apr 28, 2013