Just got laid off from my 3rd PE job in 4 years - help!

TMoneyNY's picture
Rank: Monkey | banana points 43

I just got laid off from my 3rd PE job in just over 4 years (all MM). I am pretty devastated as I thought this was the one I was going to stay at for awhile. This time I was a VP (first two as Associate and Senior Associate), and was laid off after less than a year there. Last two PE firms were boutiques, first one was bulge bracket. Nothing negative was said about my performance, although I'm certain if I was a rockstar I would not have been let go.

I think I don't have that special "something" that is needed to succeed in PE and I now have to reluctantly face up to that. But I do enjoy most aspects of it - so what should I look at getting into now to make a career? I am post b-school so can't go back there. Perhaps I could be a rockstar at secondary PE or fund of funds and make a good living? Any help/support/thoughts appreciated!

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Comments (35)

Jan 17, 2018

what do you think you are missing?

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Jan 17, 2018

Also, what was the feedback that each firm gave you at the time? Was it due to factors outside of your control, such as downsizing the next fund etc.?

Jan 17, 2018

So every time you get laid off, you get bumped up at your next role? Maybe just keep doing that.

Sorry, in all seriousness, I would ask for feedback from various past colleagues with whom you had a nice working relationship or maybe still keep in touch with. When lost as to reasons why something turns out a certain way, a little critical feedback has never hurt anyone. After the third go-around, I think you've reached that point. Are there any glaring areas of weakness you can self-identify (analytical, managerial, presentation, etc.)? The trick is usually as you switch roles / firms, the "hat you wear" often changes. A good junior banking or investment professional =/= a good mid level or senior professional. How have you been approaching the learning curve and adapting, as you have become more senior? Do you have an active system in place for self-assessment and areas / things where you want to learn / grow?

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Jan 17, 2018

I may be throwing shit in the dark but it may be Partners don't see you as a good proactive board member? Do you have weekly calls with your portfolio companies? Do you speak up? do you tell CEOs NO? Do you push back on their budget? Do you push back on their wants vs. needs? Do you advocate for the executive teams' needs in front of the board? Do you voice your opinion in front of partners / committee?

Jan 17, 2018

Hey guys thanks for the feedback - looks like you have a lot of questions about my specific weaknesses and how self-aware I am. I have a decent idea of my weaknesses. 1) I am not an elite modeler - I can be slow and it may take a couple more iterations than expected; 2) I am not as experienced with all the deal docs as I should be at this stage, and can't fully take charge of deal doc negotiations the way I'd like; 3) I am not as creative with deal structuring and term sheet proposals as I'd like to be.

But regardless, I've now spent 4 years in PE as an associate, senior associate (post MBA), and now 1 year as VP, so I have learned a lot and have a lot to offer. I just don't think it will be in MM PE anymore. So where else can I apply my talents and get a superior outcome? Perhaps secondary PE or co-investing will welcome me with open arms?

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Jan 17, 2018
rickamir1:

Hey guys thanks for the feedback - looks like you have a lot of questions about my specific weaknesses and how self-aware I am. I have a decent idea of my weaknesses. 1) I am not an elite modeler - I can be slow and it may take a couple more iterations than expected; 2) I am not as experienced with all the deal docs as I should be at this stage, and can't fully take charge of deal doc negotiations the way I'd like; 3) I am not as creative with deal structuring and term sheet proposals as I'd like to be.

But regardless, I've now spent 4 years in PE as an associate, senior associate (post MBA), and now 1 year as VP, so I have learned a lot and have a lot to offer. I just don't think it will be in MM PE anymore. So where else can I apply my talents and get a superior outcome? Perhaps secondary PE or co-investing will welcome me with open arms?

Take a much bigger step back. Any time you've spent in PE is a sunk cost. I know it's difficult to leave, but if PE isn't the right thing for you, the best time to leave is now.

What are you actually good at and what do you enjoy doing?

How much money would you want for 40-50 hours per week?

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Jan 17, 2018

Thanks. A sunk cost implies it doesn't help me going forward. That's not the case. While I now accept PE is not going to be where I end up, that doesn't mean I don't want to use the skills I have learned. But I also want to be a rockstar at my next job. I'm wondering if secondary or co-investing is that perfect compromise, any thoughts?

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Jan 18, 2018

I'm no PE expert by any means, but I feel like to be successful in PE you need to have some area of proficiency that elevates you above your peers.

If you're not an elite modeler thats fine, but you should have a great grasp on deal docs, negotiations, sourcing etc. You have to decide if those are things you can improve on or maybe just aren't quite as quick on as other people, which will make it tough for you to make it to the top ranks of PE.

With that being said, if I were you I'd be proud of the fact that you made it to a VP level in an extremely competitive industry and have had success there so far. I recently read somewhere that there are as many people in PE as there are professional athletes(not sure if true, but it makes me feel good) so its not something that everyone can get into. Maybe you're not cut out to be a partner or to run your own fund, but the fact that you keep getting rehired means you are adding value to the firms you're joining, so I wouldn't get too down on yourself.

Industry Corp Dev is something people bring up a lot but that could be a good path.

Family office investing might also be interested in someone with your background as its still deal oriented, but the pace is a little slower.

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Jan 17, 2018

Thanks, good thoughts. I think I do have areas of proficiency that make me stand out - I am able to present and speak effectively for instance, and good at getting to the bottom of questions.

While I now accept PE is not going to be where I end up, that doesn't mean I don't want to use the skills I have learned. But I also want to be a rockstar at my next job. I'm wondering if secondary or co-investing is that perfect compromise, any thoughts? Industry corp dev is something to consider, perhaps like a Time Warner? Family offices I don't know much about.

Jan 18, 2018

Pretty much every F500-F1000 will have some type of corp dev group. Even small companies will start hiring for Corp Strat/Corp Dev people pretty early on.

If you've done any industry specific deals in the past few years, those industries are usually a good place to start looking for Corp Dev groups. @Sil could probably add a lot of color here, but Corp Dev tends to be good hours, good pay, and in the right groups, the work can be varied and pretty interesting.

Jan 20, 2018

out of curiosity where did you see that statement that there were as many people in PE as professional athletes?

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Jan 19, 2018
rickamir1:

This time I was a VP (first two as Associate and Senior Associate), and was laid off after less than a year there.

Associate, Senior Associate, VP.
What's the problem?

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Jan 17, 2018

After giving your situation some more thought, have you considered targeting very small / lean PE boutiques or PE startups? The logic is that you were laid off from the bulge bracket which is probably more common than you think, given the competitive and super demanding dynamics. I would imagine the dynamics of the MM roles were along those same lines.

I think that at a boutique you would have more opportunity to differentiate yourself in terms of showcasing the areas where you feel you excel (presentation skills, distillation skills), i.e. have a greater opportunity to put your best foot forward in a more "fluid" / startup-y environment. Your past experience would probably be more value-adding within a very small startup fund and there would probably be less politics or closed door discussions where you're not privy to why things turn out a certain way. If you know you want to stay in PE which it sounds you do since you enjoy it, this gives another, potentially last, shot on goal. The only downside is obviously that the areas where you've identified weaknesses, you will have no one to punt to and you will have to deal with these things yourself which may potentially magnify issues if you don't improve in those areas

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Jan 20, 2018

You've got great generalist experience, it may be time to specialize in something. That takes courage and risk but usually pays off. I think the back-half of being a generalist career looks much like the road you're on. Good luck

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Best Response
Jan 21, 2018

Wouldn't say this for too many others, but in your case- have you considered VC? Some more thoughts for your benefit:

Given your perceived weaknesses in modeling, and the fact that you have strong sourcing/presentation/networking skills (judging by your career trajectory despite being laid off), that may be a good trade-off and perhaps a world you could really shine. It may also make for a good "story".. "hated getting in the weeds of mature cos., not enough value creation opp, wanted to do something more entrepreneurial blah blah.."

Several folks on this forum have suggested corp dev, and while I think that's one route to go, there are two questions that come to mind: (i) Are you genuinely interested in going that route? (doesn't sound like it), and (ii) Are you willing to endure a similar diligence process and do you genuinely believe you're going to be good at it? At its core, I don't think the work at a reputable F500 is going to be all that different from PE when you're in the weeds of an acquisition.

I'd suggest VC over going the FoF or secondaries route as that's really where you can leverage the skills you've built most (i.e. in making direct investments). The couple downsides I find with FoFs and secondaries (and a lot of people will hate me for saying this) is the work's a bit "fluffy" and it's not really transferable (except lateraling- what do you do if you don't like that industry).

Lastly, corporate/senior lending could definitely be an option. When I worked in PE, I actually somewhat envied the lives of the lender bros. Yes they were never going to make "carry", but they had cushy jobs taking PE chieftains out for golf every other week, got paid decently and could leverage all of the grunt work the PE associates did and just overlay their covenant "model" on top of our exhaustive and unnecessary "bank models". They also had all of the inside info on who was going to bid what- it was sort of fascinating to watch them use that to their advantage (like the IBD guys). I never thought they were the best modeling junkies, but they had great personalities/strong people skills and knew enough modeling to be able to offer you L+500. Could definitely see it being an enjoyable job that keeps you in the same world.

Hope this helps. I know multiple folks who unfortunately faced a similar predicament and just wanted to say I'm sorry about what happened. The industry, even at the middle market / LMM level is getting ridiculously competitive. Anyway, I have nothing to do with VC or lending but just felt from reading all of the posts above and your responses that your skill set might lend itself better to either of those industries vs any of the others suggested above.

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Jan 25, 2018

I think this is pretty solid advice, but if in the feedback you received from speaking with former colleagues, they say they didn't think you were 'partner-track material' (or something along those lines), you might not have accurately identified your weaknesses. A lot of people imagine themselves to be good presenters or speakers. That doesn't make them good board members or investors. I can't be sure what everyone means by 'executive presence', as it's different for everyone, but most people just don't have it. While this might not matter a great deal at the associate level at a PE fund, it matters A LOT at venture funds. Since the work is far less modelling-oriented, you have to be a comparatively better strategist to make your investment case.

I have worked in both F500 corporate development and venture capital . The hours in corporate development aren't as cushy as a lot of people seem to think. I guess it depends on the firm, but the pay/hours worked ratio isn't that great. That said, corporate development jobs (so long at the firm sees corporate development as a distinct career path) tend to be a lot more stable than VC funds. Venture funds have all the same fundraising issues PE funds tend to have, but they're smaller (generally) and more subject to business cycles. If you want a hybrid role, I would consider looking at corporate venture funds since they don't generally raise outside capital (some do, most don't). That said, the history of corporate venture is grim since companies operate on fundamentally different timelines than VCs (quarterly and annual earnings don't translate well for corporate venture funds unless they're separately capitalized/not investing balance sheet money).

Aside from the suggestions above, I'd lump endowments and foundations into your search. CIOs at endowments make VERY good money for VERY little work. You need to learn a lot about public markets to eventually take such a role, but you could start on a 'private markets' team investing in PE/VC/hedge funds, and gradually take on more responsibility over time. The people who work in the field are not the best financiers in existence, so it's easier to be a standout performer. At the same time, the people who work in the field tend to be lifers. They don't like to job hop too often, so the promotion trajectory is flatter. They also don't pay as much for junior and mid-level talent, so I'd expect a significant decrease in comp in the near term.

Family offices are hit and miss. Some are great and run with institutional protocols in place managing billions of dollars. Others are a guy and his dog with <$100M and no structure whatsoever. That lack of structure, by the way, means you're subject to getting fired on a whim by the family. Keep that in mind when considering your options.

One final idea--you might consider a 'deals strategy' role in consulting. All the major shops have transactions services and deals strategy teams. There are PE groups at most of the top firms too (largely doing DD). You could try to lateral into one of those groups, stick it out a few years and make partner or move back into a PE fund at a more senior level (probably at one of your clients) where your modeling skills will be irrelevant.

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Jan 26, 2018

+1 on endowments and foundations. I knew nothing about this field within finance and it is rarely talked about on wso, but I had an interview with a foundation a year ago (didn't get the job). Comp and hours are really good, and the work is quite interesting. As @brotherbear noted, you need to really REALLY understand the public markets and macro factors affecting the economy/world. It is also an analytical role where you are using statistical programs to assess fund performance or PM performance, etc. Not a heavy "quant" role, but you need to know R-squared, correlation, std. deviation, black scholes and other similar statistical measures.

As for my interview, it sort of went like this. They showed me a chart with 8 graphed lines and pointed at the line that was the S&P 500's performance over the last 10 years. I had to then identify the 7 other lines based on their relative position to the S&P 500. (i.e, which line do you think is gold? how about the MSCI? how about oil? etc.)

Needless to say I completely bombed my interview.

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Jan 28, 2018

I would not consider deal strategy at a consulting firm. You'll be getting paid much less money to work harder with less control over your lifestyle. Your job will often be to find ways to rubber stamp the deal team's desired conclusions and/or do the work no one at the firm wanted to do.

Also, except at the junior level (first year associate) I don't think it really opens up PE opportunities because consultants get limited practice in modelling and none in deal structuring, term sheets, and any of that other fun stuff

Jan 26, 2018

this is a good thread to flash the @APAE bat sign

Jan 26, 2018

I think co-investment, secondaries and FoF is a good shout despite what other people say and if it was "fluffy" then there wouldn't be a lot of smart people doing it and getting paid well for it.

They'd appreciate you a lot and you will very likely be the rockstar of your job, plus hours will most likely be good and you'll work on interesting stuff. PM me if you have more questions.

Jan 27, 2018

I've posted my story on previous forums. In short about 6 years ago I left consulting (MBB) after 2 years to go to a mid-size pe shop about $3B in AUM so that I could go do an executive MBA and get PE experience. I'm a non traditional hire military right out of high school, target undergrad, target MSF. Needless to say it was a disaster, a lot of politics.

In short everyone was trying to get me fired from day one. Sometimes you just don't click with people. I left before getting fired but I could hear them bad mouthing me through the walls and accidentally got CC'd on an email bad mouth me.

Needless to say it hurt but I started looking for a new job immediately. Got a new job at a mega fund and haven't looked back.

I asked for feed back before I left and honestly it was all BS "you messed up on xyz or I screwed up on abc." My response was "big issue, I never worked on any of that stuff." Their response "Well you have a beard and are doing a MBA program that's every other Saturday and I just don't like you blah blah." Ending up just walking out during that conversation and didn't stay my two weeks and deleted all my work. Didn't answer my phone when they asked questions and have never responded to an email.

Honestly I was super cautious at my next job but it worked out. Went from shit fund to mega fund. It will all work out.

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Jan 27, 2018

Thanks for sharing this. I've been surprised how wildly different "culture" can be in various firms/groups and how it can make or break an experience. It's critical to have lunch with your future team before accepting any offer if you can. I've started really pressing this issue. You can learn a lot at a team lunch.

When I transferred from one office of my old firm to another, I had lunch with "the team." I got a great vibe, and it turned out those three guys I had lunch with were great. But after relocating, I got assigned to two other people in the group I'd never sat down, who had just joined the group themselves. They could not have been more different (in all the worst ways) from the three guys I'd had lunch with. I ended working with original three guys about 1/3rd of the time and being forced to work with and report to the other two people the rest of the time. What followed was the longest eighteen months of my career. Absolute nightmare.

I left to do an upstart consulting project with a couple guys I knew from my first firm, and it's been amazing. I consider them good friends and mentors as well as coworkers.

Six years into financial services, one thing I would tell my first-year self is that the people you're going to spend 12+ hours working with every day will make or break any role. It can be your "dream job" based on the job description, but if you have a supervisor who's dishonest and/or incompetent, it will be a nightmare. Conversely, a role you're not wild about on paper can become exponentially more enjoyable if you're working with people you'd gladly hang out with even if you didn't work with them.

"Now you's can't leave." -Sonny LoSpecchio

Jan 27, 2018

Couldn't agree more. Unfortunately I think the firm I went to had issues well before I joined and I just exacerbated the issues. The hiring process was typical but a lot of red flags.

I had an offer late last year at a small firm through a recruiter and turned it down. Too many red flags. One of the big ones was lack of communication, high turn over, and they gave me a verbal offer with a certain number in mind and then on paper it was lower. Money only goes so far. A toxic environment is not worth it and it only gets harder to find a job the higher up you get.

Jan 28, 2018

This guy fucks.

Jan 27, 2018

I do fuck

Jan 27, 2018

I have been in a very similar situation. I lost my job with a family office in less than a year. I have worked at a real estate fund for 5 years before this. But I left that because they weren't fund raising and I was basically stuck with making asset management reports most of the time.

I would say losing my job was a combination of factors. I realized that PE analyst role isn't something I truly enjoy, I was working in a small family office set up with a lot of politics and an unhealthy work culture, where everything happens on the whims of the boss. I also felt high finance jobs are discriminatory to women (but that's just me). I was working long hours with no acknowledgement and constant criticism and I felt my soul was being crushed every single day.

I would say find something you like and look forward to, it's scary but take some time off and think about it. Please don't work with a family office, they have no work culture there.

I now work as a product manager with a bank, where I need to develop new investment products, meet clients, work with other relationship managers. For the first time in my life, I felt some semblance of a work life balance, I like the work culture here and my job profile. Make a clean break from PE, I say. Don't kill yourself just to make more money.

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Jan 28, 2018

Can I ask you how in the world you continuously land better and better roles despite being laid off repeatedly? Not trying to sound like a dick at all, what's you're networking/job search process like? To you go through recruiters? Job boards? LinkedIn and cold-emails?

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Jan 28, 2018

investor relations, government would be a slam dunk, f500 finance role, or a smaller pe firm?

If the glove don't fit, you must acquit!

Jan 28, 2018

You became a VP in a little over 3 years in spite of being laid off twice during that time....really?

Jan 29, 2018

I think you should look into DFIs, like that of Norfund, DEG, or something like that of some Canadian pension funds. They have direct private equity investment team, and their workload or expectation is often low (within the institution) compared to the professional fund managers (PE firms). These are easy going places. Working in a PE fund where they are the LPs, I can get a feel of their way of work. With your background, I think you will be a highly qualified candidate for them. All the best!

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Jan 17, 2018

go work for the FBI - they love finance / acct backgrounds

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Feb 8, 2018

How many deals have you gotten done?

Jan 28, 2018
NYC10023:

How many deals have you gotten done?

Barely any...He couldn't even close the deal with his last girl, who I know for a fact was giving it up to everyone in town.

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