Is MM PE a smarter move than MF
It seems like ever making partner , or really even beyond associate for most people, is nearly impossible at a MF, so would it not just be smarter to take a smaller mm and have the chance to make partner? Plus, isn’t the economics and valuation aactually better on mm deals?
Oh, plus you close way more deals in mm, giving u more experience, versus not many deals, that are all huge.
European perspective here but I've worked in two LMM/MM PE's as analyst, associate, and manager...the idea that you do more deals is not necessarily true. You fishing pond is bigger in volume terms, but your restrictions are: ultra-competitive auctions (in developed markets), and typically a key-man risk in IC... (e.g. big shot partner who controls the ultimate decision). If you're at a firm who values typically at discounts, you're lucky to do a deal at all because there's so many MM shops to compete against.
On the advisory side, however, you can pound out mid-market deals like there's no tomorrow (in my previous live as strat/CDD consultant I did 20+ transactions in 2.5 years), so on this side of the table the argument holds up.
I generally agree and am interested in MMPE for that reason. The one good counterpoint I’ve seen though if as it’s easy to move downstream, so a KKR associate could probably jump into a MMPE firm as a VP much easier that someone from another MMPE firm, so a MF brand is helpful for keeping doors open.
Depends what you want. I've gone into this in length before, but the pros and cons of both, IMO:
MF:
Pros: Most optionality post associate stint, best bschool placement, best brand names, better comp
Cons: Rarely upward mobility, generally more structured program (less responsibility, more like a banking analyst role), less portfolio company exposure, larger deal teams, worse work/life balance
MM:
Pros: More responsibility, smaller deal teams, more exposure to portfolio companies and management teams, generally better work/life balance (though there are exceptions)
Cons: Less brand name when it comes to bschool placement, less optionality when it comes to laterals/etc., lower comp usually
Probably are more that I'm forgetting right now.
Is it possible to get carry earlier at a mm? Also, if so, if you had to choose between brand name at MF or carry at mm, which would you choose?
First question -- That is all situational. Sure, I know of some MM funds that give carry to associates, but it's not common. If the firm has a track record of promoting within (so, Asso --> Sr. Asso --> VP), then they are probably more likely to give carry. Firms generally will not give carry to associates if it's a two-and-out program.
Second question -- Again, situational. Carry at a poor performing MM fund won't really get you much, but at a top MM it could definitely be worth while. You are guaranteed to not get carry at MF, but you would choose the MF over the MM for all of the reasons I listed above.
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