Do the exit opportunities pay that MUCH better than banking?
From what I've read basically everyone on this forum that is currently an analyst or in banking will eventually try and switch over to either PE, HF or VC.
The hours are better, the quality of life is better and the pay is higher.
Private Equity, Hedge Funds and Venture Capital are very prestigious industries that are tough to get into. Some of the most prestigious PE shops such as KKR only take extremely qualified candidates that have usually worked at either Goldman or Morgan Stanley or were at the top of their class at another BB.
How much better is the pay in PE, HF and VC. Will you automatically make 7 figures even if your at the bottoom of the food chain?
Check out this thread:
http://www.ibankingoasis.com/node/1903
Hah, I remember that thread.. That was depressing as hell to read.
After finishing BB analyst stint and exiting to PE, HF, VC does pay skyrocket? (Originally Posted: 03/31/2007)
I hear all these people on the board going head over heels about the famed "exit opportunities" that so many people mention.
Once you complete your two year analyst position at a BB and successfully exit into either PE, HF, or VC do you automatically start making around $250,000 in your third year and do you reach the annual seven figure income much sooner than you would if you stayed at the BB and attempted to reach senior positions such as MD etc..?
For the majority of peole, no. The pay is at best the same or less. The main difference is the quality of work and the hours. You might only get 200k, but your hours will be a fair amount less and the work will be more enjoyable.
Why do so many people then leave the Bulge Bracket investment banks and attempt to make their fortunes in PE, HF, or VC.
If you think about all the people that use banking as a stepping stone, if you decide to be a career banker, your odds of reaching Managing Director improve significantly considering how many people decide to leave after completing their analyst role.
Yes, the lifestyle may suck but you are improving your odds of reaching senior management status such as Managing Director and really having a great lifestyle (out of the office).
Jambaman, think reinvestment
I agree- a lot of the reasons you want to be on the buyside have little to do with pure finances.
Not everybody wants to spend their 20's doing mind-numbingly boring work until 2 AM, when they can do slightly less boring work until 10 pm and maybe, just maybe get a slice of the pie later on.
500k vs 1.5m a year = not enough difference in lifestyle to give up your 20s
i think that on average, PE comp is comparable to banking comp at the same levels. However, the range is much wider vs. banking, so that some PE firms pay much higher than bankers and some pay much lower. As you get more senior, I think that the difference in PE pay relative to banking begins to grow, but tilted towards higher. Thus the lowest paid PE partner is probably still doing alright relative to the average MD, but the compensation of the highest paid partners outpaces that of bankers.
btw-- i don't think bankers make 1.5mm in their 20s...
I've heard of people that were offered 500K+ at a hedge fund after their first two years of banking at a BB.
Thats outrageous...what hedge fund?
it was most definitely a unique case. People do not earn that much money normally at such a young age
Seriously, would you shut the fuck up? You're the one who started this thread asking for advice and information regarding PAY. Then, 6 posts down, you're telling someone what people "definitely" do and do not earn at what age. Nobody wants to hear your shitty and uninformed opinion. Asking questions is fine, but I constantly see you posting these 'facts' all over the forum and I don't know why you even bother.
why is it that in the ny times there is a compensation discrepancy b/w ibanking nd pe? http://graphics8.nytimes.com/images/2007/04/03/business/0404-biz-2dsubP…
How many 25-year olds do you know PERIOD? eh?
[quote=slik vik]why is it that in the ny times there is a compensation discrepancy b/w ibanking nd pe? http://graphics8.nytimes.com/images/2007/04/03/business/0404-biz-2dsubP…]
Upside is higher in PE.
You might work 65 hours instead of 100, but in with your spare time you can take up a second job (I heard bartending pays quite well) or start a search engine or something, if you're that insane.
Or you can have a social life with the 35 spare hours.
what school are you at, jamba?
It's a non-target school. Although I do have a very high gpa that worked in my favor. Ultimately I figured out how to network to get myself in.
It doesn't matter what school I'm coming from because I got an internship and if it makes your ego any greater knowing that I go to a non-target then I'm happy for you. (If your not doing this in a condescending manner, I apologize)
I think we should let the level of our position once we are FT do the talking about who is better.
I love how Zalas like would you shut the fuck up and its on an online message board. hahaha kind of funny.
When you exit ibanking are you potentially sacrificing the chance for MD level pay (Originally Posted: 03/22/2007)
So I know all the people on here that talk about leaving IB after 2 years of the grueling analyst lifestyle. They go to Private Equity, Hedge Funds and Venture Capital firms.
People make it sound that the exit opportunities are phenomal. True, you don't work the crazy hours and you probably make a bit more money.
The real question I have is for the people who leave and get into the top-tier PE firms such as KKR. Do the new opportunities in PE present a much higher potential for a large income than if one was to slug it out in Banking and trying to reach MD.
Also at what level in PE, HF, VC do you make the equivalent amount of a Bulge Bracket Investment Bank MD (roughly $1.5-3 million per year)
The odds that you will make anything close to what an MD makes at any point in your career given that you start as an analyst are statistically insignificant.
I don't get the feeling you know what statistically insignificant means.
who cares
True, the odds are most people never reach Managing Director. Either because they leave after serving as analysts for two years and realizing that there is no chance in hell that they are going to endure another 5 years of a work-only lifestyle for the potential to reach the glamorous lifestyle and power that comes with being a Bulge Bracket Investment Bank MD.
The other half decide that slugging it out for the rest of their careers isn't such a bad thing and they could end up at the MD level some day, but figure out that once they hit VP the shit hits the fan and they don't rise up any higher eventually retiring as VPs.
What I'm asking here is who are the people in these mega PE firms such as KKR, Hedge Funds or Venture Capital firms that make the money that Bulge Bracket Investment Banking MD's make.
I've read that the "MD" title is reserved for less than 15% of all of a bank's employees.
Does somebody have an aswer to this question?
What kind of answer are you looking for? These people are Finance experts who decide to go to PE firms or join a small hedge fund. Generally, the work is about the same, except the groups are much smaller in size and more exclusive, and you now take a more front seat role in bringing in business (just like MDs do).
Man, just concentrate on your analyst stint instead of thinking 15 years down the line.
I think its an interesting question though, esp. if you don't absolutely hate banking and are debating whether or not to stay on for the 3rd year/associate track or jump ship to buyside.
Apply to be Warren Buffet's apprentice.
Qui sint voluptatem sint quibusdam laudantium. Quo dolores quis facere velit. Delectus repellat consequatur iure id nam asperiores totam.
Ea est cum vel voluptatem aspernatur omnis consequatur. Omnis doloribus eum occaecati veniam sit. Velit est et voluptatem iste.
Quas est et esse fugit ratione sed consequuntur. Rem hic aut aperiam amet vel et vel. Nam ut delectus quis quam. Qui repudiandae quia dolores delectus culpa cupiditate distinctio. Quo explicabo aut nemo magni maiores reiciendis.
Quasi illo ipsa iusto officia qui blanditiis laudantium. Doloribus totam accusamus veniam et. Odit alias eos aspernatur qui omnis id. Ut quis totam atque occaecati quos et.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...
Porro minima sint voluptatibus vero voluptatum fuga officiis. Voluptate sed occaecati in saepe. Ut veniam dolorem sed voluptatem. Rerum omnis architecto recusandae qui nobis aut cupiditate ut.
Id ea minus est autem ut quas. Et culpa et nihil nemo eos dicta. Tempore dignissimos voluptatum et inventore et placeat expedita. Aut nulla earum dolores corrupti suscipit maxime quia officia. Sit blanditiis aliquam aut molestiae occaecati explicabo. Sed asperiores totam quo quas aut sed dolorem.
Animi impedit libero voluptatibus magnam occaecati non atque. Veritatis omnis iusto totam illum. Et at molestias accusamus autem.