Leaving your PE firm

Subscribe

I've been working at my current PE fund for less than a year now, after breaking from IB.

I must admit that when I took the job, my motivation was more to get out of banking rather than because I thought the fund was great. I was really getting killed badly in IB, and not getting paid much to alleviate that suffering. In a nutshell, I thought the guys and the fund was just OK (not a brand name shop), but was pretty far from my dream fund. The other thing is that the fund is in fundraising mode right now which adds to the uncertainty.

Recently I got approached by a great PE shop that needs to make some additional junior hires (has the brand, the money and the track record), and I would be quite keen to make the move. Questions are:

  1. How bad will it be for me to quit so quickly? Will the partners rip me apart?
  2. What do I tell them when I quit i.e. how to quit "nicely"?
  3. Does it look really bad on the CV, should I wait a bit more?

Thanks for the advice

Comments (49)

 
Mar 7, 2012 - 8:37am

If the new shop approaching you is a better fit. Take it.

Why suffer at a place that doesnt meet your expectation for the sake of what the partners think.

Leaving banking after a year or two hardly speaks volumes for anyone in terms of job hopping but this is finance and people move. The opportunity might not be there if your wait.

 
Mar 7, 2012 - 9:18am

yeah melvvvar I was thinking about mentioning the comp. but what if they come back and top up the package significantly? I still wouldn't want to be in that place and would look pretty stupid. I will probably be straight forward and tell them that I don't think I fit.

My CV is already quite scattered, look at the mess:
1 year at a second tier IB
2 years at a second tier IB
Ivy MBA (+ internships at 2 different megafunds)
1 year at a BB IB
almost 1 year MM PE

 
Mar 7, 2012 - 9:36am

HighlyLeveraged:
yeah melvvvar I was thinking about mentioning the comp. but what if they come back and top up the package significantly? I still wouldn't want to be in that place and would look pretty stupid. I will probably be straight forward and tell them that I don't think I fit.

My CV is already quite scattered, look at the mess:
1 year at a second tier IB
2 years at a second tier IB
Ivy MBA (+ internships at 2 different megafunds)
1 year at a BB IB
almost 1 year MM PE

let me share with you some of the best advice i have ever received on career switches.

take the money and run.

 
Mar 8, 2012 - 3:42pm

HighlyLeveraged:
yeah melvvvar I was thinking about mentioning the comp. but what if they come back and top up the package significantly? I still wouldn't want to be in that place and would look pretty stupid. I will probably be straight forward and tell them that I don't think I fit.

My CV is already quite scattered, look at the mess:
1 year at a second tier IB
2 years at a second tier IB
Ivy MBA (+ internships at 2 different megafunds)
1 year at a BB IB
almost 1 year MM PE

curious,
what do you mean by Ivy MBA (HBS, Wharton), or something like Columbia, tuck (are there more ivies in the top 10)?

also,
really interested in how you moved to Pe after Associate IB, most people in this forum say it is not possible.

btw, my advice is "move out".
Check my background
.5 years quant finance off shore for top 5 BB
1.5 years actuary at big multinational insurer
then 1.2 years manager at Big 4 (advisory)
hopefully MBA this fall

i promised 3 years at insurer, but still took the opp at the Big 4, best decision i have ever made. There is nothing like waiting on sunday nights for monday to come so that you go to work because you love what you do.

 
Mar 8, 2012 - 3:47pm

lifeofpurpose:
There is nothing like waiting on sunday nights for monday to come so that you go to work because you love what you do.

Should be working on Sunday you pussy!

Joking.

"After you work on Wall Street it’s a choice, would you rather work at McDonalds or on the sell-side? I would choose McDonalds over the sell-side.” - David Tepper
 
Mar 8, 2012 - 3:57pm

lifeofpurpose:
HighlyLeveraged:
yeah melvvvar I was thinking about mentioning the comp. but what if they come back and top up the package significantly? I still wouldn't want to be in that place and would look pretty stupid. I will probably be straight forward and tell them that I don't think I fit.

My CV is already quite scattered, look at the mess:
1 year at a second tier IB
2 years at a second tier IB
Ivy MBA (+ internships at 2 different megafunds)
1 year at a BB IB
almost 1 year MM PE

curious,
what do you mean by Ivy MBA (HBS, Wharton), or something like Columbia, tuck (are there more ivies in the top 10)?

also,
really interested in how you moved to Pe after Associate IB, most people in this forum say it is not possible.

btw, my advice is "move out".
Check my background
.5 years quant finance off shore for top 5 BB
1.5 years actuary at big multinational insurer
then 1.2 years manager at Big 4 (advisory)
hopefully MBA this fall

i promised 3 years at insurer, but still took the opp at the Big 4, best decision i have ever made. There is nothing like waiting on sunday nights for monday to come so that you go to work because you love what you do.

I'm post H/S/W MBA. I had megafund internships and networked like crazy while in B-School. Still had to go back IB but went to Sponsor/LevFin (as opposed to a sector team previously) so at least I did learn something. Then more crazy networking while in IB and finally got the job through an alumn. Definitely possible to break in (at least for mid market PE) but I didnt have a lot of choices, that's why I ended up in this fund.

 
Mar 7, 2012 - 9:52am

Option A:
1. Irrelevant
2. Irrelevant
3. Irrelevant
???
n. start new job and be happy

Option B:
Your other option is to play nice, stay where you are, and be miserable. It's likely that your work ethic will suffer, you'll get laid off, and then be fucked.

Pick one

Get busy living
 
Mar 7, 2012 - 9:30am

HighlyLeveraged:
IThe other thing is that the fund is in fundraising mode right now which adds to the uncertainty.

This statement is the most important reason to consider the move, assuming that what you're saying is your fund doesn't have capital to put to work yet and is strictly in fundraising stage. At this point in your career, the most important thing for you is to get good deal execution experience. If this means moving to another fund, nobody down the road is going to question you for reasons for doing so.

 
Mar 7, 2012 - 10:18am

hmmm ... thanks for all the good advice.

Fund doesnt have money to put to work now (maybe 50m leftover), and fundraise likely to take 2 years in this environment. We're looking at deals but nothing really serious. To keep myself busy I'm getting involved in a lot of networking and B-school stuff, which is why I'm more visible and other funds reach out to me. The upside is that if we raise the money, I'll get promoted real fast given that it's a small place, but I'd put a 30% probability on that.

I also invested some cash in one of the portfolio company (very small company but likely to do a 10x return...), I just hope I won't get screwed on this.

 
Mar 7, 2012 - 10:41am

Dude, you're post MBA, who gives a shit.You've now moved out of the realm of trying to impress to trying to get paid. If this shop offers you more money and or the opportunity to further your earning potential make the move.

I'll tell you how to quit even. Close the door to your MD's office, say you've greatly appreciated the opportunity to work at the MD's fund however you've been presented with an exceptional opportunity elsewhere and will be submitting your resignation.

Ace all your PE interview questions with the WSO Private Equity Prep Pack: http://www.wallstreetoasis.com/guide/private-equity-interview-prep-questions
 
Mar 7, 2012 - 10:56am

If you are going to take the new offer, ensure you can commit to it and that the new firm is somewhere you can spend 3-5 years (if you leave it will probably be due to you leaving the industry or your team leaving and taking you with them). Will you get carry at the new fund?

Once you say you want to leave, do not entertain counteroffers from your current firm, you will be the guy who slept around while in a relationship... not to be trusted even if they let you back into bed with them.

You are treating them like shit with a move so soon after you have been hired as it seems you are post-MBA and on the career/partner track. Make sure you leave things on a good enough note. You don't want the partners of your current firm feeling like a hurt ex-girlfriend. If you leave badly, they will try to screw you, not so much on your investment, but in terms of reputation. Manage the break up well. This is a small world and you may want to work with them in the future on club deals, a new firm, or similar opportunities (who knows where you guys will be in the next phase of the cycle).

 
Mar 7, 2012 - 11:16am

I think if the new/better shop is approaching you....then you should capitalize on the opportunity. Its not like you went under their nose to get out.

XX
 
Mar 7, 2012 - 11:19am

My whole perspective on leaving a job changed the first time I did it. I left for completely legitimate reasons and with an offer that my then current employer could not match. Sure, I would not have considered a counter-offer, but they couldn't provide one anyways. I was all concerned about not burning bridges...blah blah blah

The next job I took turned out to be a pile of festering shit. My new employer had oversold me to the point of blatant dishonesty. I considered going back to my old job, something I would have never even thought possible when I was initially leaving. I met with my old boss (about a year after I left at this point), and it was clear that he was still as pissed at me as the day I told him I was leaving.

At my current job, we had a guy leave by leaving his company property on his desk and sending an email. After being a not even mediocre employee, he will forever be remembered here as a legend.

TLDR: at some point in your life, take charge of your career and stop worrying about not burning bridges between you and some asshole MD who really is an asshole. Burning bridges only comes back to bite you in poorly made Wall St. dramas and chick flicks.

 
Mar 7, 2012 - 12:17pm

I could definitely spend 3-5 years at the new fund, given that they've just raised a massive pile of cash. Sure the career progress will be slower as I'll start from scratch (i.e. post MBA senior associate, probably no carry until a couple of years, maybe 10 years to partner) but at least I'll get to do deals and will have a good brand name to leverage on.

Over the last 6 months, I haven't even been in a serious due diligence exercise at my current fund and just doing portfolio stuff, which gets boring very quickly if you don't like the sectors. Pay and bonus is also at or slightly below market (but promises of massive payouts when we close the fund). Only advantage is lots of free time and freedom.

The MD in our shop is a very high profile ex-CEO of a very high profile financial institution, and if he wants to destroy my reputation, I suspect he could do this very easily. So I don't want to quit out of nowhere, and probably will need to send a few "signals" first i.e. flag that I want to do more deals, ask for a raise, etc.

Quitting was much simpler in IB...

 
Mar 7, 2012 - 12:25pm

Dammit, this is going to be even more painful than breaking up with a hysterical girlfriend - at least they can't scratch my face or burn my stuff

The other day they were saying how bad it looked to have 2 people quitting over the last 2 years for fundraising purposes (they actually fired the guys), add another resignation and its going to look extremely bad

 
Mar 7, 2012 - 2:46pm

I would say just make sure you are in the right line of work. I know it's not entirely uncommon to jump around a bit but you should definitely decide whether you are unhappy because of where you are at or because of what you are doing. If it's the first, then jump ship as nicely as possible and enjoy your new opportunity. If it's the latter, take some time to think about what you would rather be doing and potentially make a move in that direction.

I know a guy that did 3 years in IB then went to VC for a year but didn't like what he got himself into. He left to run his own little business for a little while but realized that wasn't enough so he went back to IB. After a year back in IB he decided he didn't like that as much as he thought he did so he left for some asset management type role. I'm sure it will only be a short bit of time before he moves on again. The point? Make sure you are happy with yourself otherwise you won't be happy anywhere doing anything. Not saying you are, but worth giving some thought. Best of luck.

Regards

"The trouble with our liberal friends is not that they're ignorant, it's just that they know so much that isn't so." - Ronald Reagan
 
Mar 8, 2012 - 2:23pm

you're already post-MBA and this new gig is way better, like somewhere you will stick around for a few years at least. go for it!

Money Never Sleeps? More like Money Never SUCKS amirite?!?!?!?
 
Mar 8, 2012 - 4:41pm

M&A, Sponsor, LevFin, sector teams...it doesn't matter much..it's really about the whole CV "package" and quality of experience. You just can't look at components of your CV in isolation - if the guys is smart and nice, who cares if he was in LevFin or M&A, or if its Columbia or Wharton, or if its CS vs BAML...

I was in a sector team pre-MBA and lacked a bit on the LBO modelling side so that's why I picked that team. It's all about making sure that you have the right skillset for PE: business sense, modelling skills and personality. Then whatever you pick is fine.

 
Mar 8, 2012 - 9:29pm

One more thing (note: currently hammered post a closing dinner), interned with a HY debt investor in college. Super chill joint, 45 hrs of work a wekk, group got hammered at a drop of a hat. Awesome place to do some half assed finance, still kinda be in "the game", b;ut your not really hot shit comp'd to your analyst calss peers being VP's at top PE houses, etc. / still doing 100 hrs a week between the office, traveling and married to their BB's at 32.

Had one sr. I worked 4 who was a burnte out BX guy. Stacked resume up till working at said shop. He was like, good pay, still kinda challenging and have my life back. Piont being, you ave your MBA, done your time in deal pits, do what makes you happy and you'll get satisfaction out of personally / professionallhyh

String, Out..

Ace all your PE interview questions with the WSO Private Equity Prep Pack: http://www.wallstreetoasis.com/guide/private-equity-interview-prep-questions
 
Mar 9, 2012 - 3:37am

Thanks for all the input, really useful to think about this.

Now assume that I don't get the offer at the other fund. Would you advise me to actively look out for an exit (discretely of course)? Moving out takes time so don't want to sit around.

Its just been 6 months but I kind of lost faith in this place. There is no partner that I truly respect or admire (yeah they were big shots CEOs but doesn't mean you can do PE and I really have some doubts), and some of the investments they look at truly scare me. Sometimes I'm asked to screen companies and think to myself "Really? You really want me to look at this??"

I'm really worried about not getting any deal experience, not having any real mentor in the firm and destroying my CV if fundraise doesn't work out.

 
Mar 9, 2012 - 5:25pm

HighlyLeveraged, if you really have no faith in their ability as investors and they have not concluded their fund-raising, it makes sense to keep your options open... Ultimately your progression at this firm would depend on:
- them having capital to invest
- their ability to make good investments (and/or be lucky)
- your ability to shine in this environment and get part of the carry at some point (or build a network / exit to a portfolio company)

Your fund's track record will become yours after a certain amount of time. This is not banking, today's acquisition is tomorrow's portfolio company. You're still junior though, so I suppose this point isn't of immediate importance.

If you are using this place as a stepping stone, then keep looking for better opportunities, no need to delay.

 
Mar 19, 2012 - 10:03am

interesting topic, usually you get a lot of conversation around how to make it to PE but not much on what happens after...

Do you think brand is very important in PE in terms of exit and career opportunities? (lets say if you want to be an entrepreneur and raise money, launch your own fund, work for a PE backed company) Or is it basically all about the quality of your experience??

 
Mar 19, 2012 - 1:49pm

HighlyLeveraged, any update on what you decided to do?

There have been many great comebacks throughout history. Jesus was dead but then came back as an all-powerful God-Zombie.
 
Mar 19, 2012 - 5:19pm

I'm in the final stages with the dream shop, it's going well so far. Also sent my CV around a bit and started a process with another good fund.

I had a chat with the partners of my current fund to try to "set the scene", mentioning a couple of things I wasn't happy / didn't agree with in terms of investment strategy and mentioning that I wanted much more responsibility, etc. Nothing is going to happen with regards to that, but at least, if I take one of those offers, I can just say "I warned you guys".

So if I get one of those two offers, I'm definitely gone....

 
May 27, 2012 - 2:47pm

Do it. It's normal to feel what you're feeling when presented with such an opportunity. The people you're working with will understand. It's fine from a legal perspective since you're probably at-will and can leave at a moment's notice (obviously not a good idea). Be thankful for the experience and set a nice early notice as to not leave anyone hanging. Good luck!

 
May 27, 2012 - 2:56pm

Contemplating leaving my firm in the semi-near future (1-2 years), and just recently was able to justify that if what I want to do is elsewhere, then fuck it. Jump in baby. Nobody will blame you if your resume says "went from decent PE shop to awesome PE shop where I'm happier and do better work." In hindsight, opportunities passed up are way more painful than opportunities you took and realized weren't so great. Can't imagine someone will frown upon you when they see you spent only 1 year at your first PE firm but have 2+ years at a more prestigious one most recently. They'll only care about that.

YOLO BRO

I hate victims who respect their executioners
 
May 27, 2012 - 2:57pm

Leave PE Associate Position Early? (Originally Posted: 09/14/2013)

2nd yr analyst at very strong BB group / elite boutique w/ PE job lined up for next year. Starting to think I may prefer to be at a HF instead. Based on deals I've worked on since recruiting for PE positions, I've realized I hate the traditional diligence process and would rather spend more time on analysis and less time dealing with parties like bankers, consultants, lawyers, etc.

Recruited for PE as it seemed more similar to the work I was doing and a safer route to obtaining a buyside job post-banking than recruiting for HF.

My questions are:
1) How frequently do PE associates leave their firm before the end of their traditional 2 / 3 yr program? How bad is it in terms of burning bridges?

2) How difficult is it to go about interviewing for HF positions when you're part of a fairly lean PE shop (not many people to give you cover)? How would headhunters or HFs view a PE associate at a strong, but not amazing MM PE shop w/ good background (Ivy / Ivy-caliber school, aforementioned banking experience, etc.)?

 
May 27, 2012 - 3:00pm

I think the first question you should ask yourself is why aren't you trying to recruit for a position at a HF now? If that is what you wish to do, then getting hired for an immediate start and leaving your current gig is your best bet.

If you don't want to work in private equity and you don't want to market in private markets, then don't worry about burning bridges at that particular fund. Call them up and explain your decision and apologize for the inconvenience.

This notion of entering a PE fund with the intention of leaving prior to having started is backwards. That is what banking is for. Sure it's possible and I'm guessing frequently done, but if you are ready now, then I don't see a reason for you to keep waiting by working in adjacent jobs.

Sorry I don't have a response for your specific questions, but it sounds like you need to change your initial approach.

 
May 27, 2012 - 3:01pm

Disagree with the last guy. IB -> PE -> HF is a well worn path. I recommend spending 1 year in PE then contacting head hunteres and telling them that you want to recruit for HF gigs during your 2nd year. It sounds like this is a 2-3 year up-and-out situation, so it's going to be expected that you will be looking to go to b-school, lateral to another pe fund, or jump ship to the dark side (hf)

 
May 27, 2012 - 3:02pm

IB -> PE -> HF is a worn path. Are you suggesting that because it's a worn path it's also the most optimal?

OP, the HF universe is far and wide. My recommendation is to see what type of work you would like to do at a HF, see the shops that do such work, and see if it is possible to recruit at them with just your banking experience. There are reputable HFs out there that recruit out of undergrad, out of banking programs, out of banking and PE programs, etc. Don't spend 2-3 years doing work you don't enjoy at a fund that you already plan to leave, unless it is the best route. It sounds like you have great credentials that if coupled with good investment knowledge (likely accumulated from self study), then I say go for it now.

 
May 27, 2012 - 3:03pm

By going to this PE gig, OP gets to:
- Definitely move to buyside (becomes more difficult the longer you stay in IB)... bird in hand
- Potentially discover that he/she actually likes PE (it's still transactional but better than banking in most respects)
- Learn certain skills in PE which are legitimately useful in a long-term business career which will likely outlast the waning glory days of Asset Management by several decades
- Become more attractive to hedge funds, thus increasing the chance of getting into a top brand name fund instead of xyz $500 million undifferentiated imminently-going-out-of-business L/S equity hedge fund
- Avoid pissing off the PE firm where he/she has likely already started. The entire alts word is very small, and one should avoid burning bridges until such time as one never needs to work again.

Start Discussion

Popular Content See all

Received my PWP rejection email!
+91IBby Prospective Monkey in Investment Banking - Mergers and Acquisitions">Prospect in IB-M&A
Is Evercore the next Bulge Bracket bank?
+24IBby Intern in Investment Banking - Mergers and Acquisitions">Intern in IB-M&A
I got a top IB SA offer thanks to WSO
+17IBby Prospective Monkey in Investment Banking - Mergers and Acquisitions">Prospect in IB-M&A
Is Liontree the next bulge bracket bank?
+16IBby 1st Year Analyst in Sales & Trading - Equities">Analyst 1 in S&T - Equities
Virtual Summer Interns - which banks sent you WFH gear?
+15IBby Intern in Investment Banking - Industry/Coverage">Intern in IB - Ind
Biggest Regret in Undergrad
+14IBby Prospective Monkey in Investment Banking - Mergers and Acquisitions">Prospect in IB-M&A

Total Avg Compensation

October 2020 Private Equity

  • Principal (6) $693
  • Director/MD (14) $640
  • Vice President (53) $361
  • 3rd+ Year Associate (60) $272
  • 2nd Year Associate (112) $246
  • 1st Year Associate (242) $222
  • 3rd+ Year Analyst (23) $162
  • 2nd Year Analyst (52) $141
  • 1st Year Analyst (150) $118
  • Intern/Summer Associate (17) $66
  • Intern/Summer Analyst (167) $60

Leaderboard See all

1
LonLonMilk's picture
LonLonMilk
98.4
2
Jamoldo's picture
Jamoldo
98.3
3
Secyh62's picture
Secyh62
98.2
4
CompBanker's picture
CompBanker
97.8
5
redever's picture
redever
97.7
6
Addinator's picture
Addinator
97.6
7
Edifice's picture
Edifice
97.6
8
NuckFuts's picture
NuckFuts
97.5
9
frgna's picture
frgna
97.5
10
bolo up's picture
bolo up
97.5