LifeCo Positions on the Equity Side

Hey Monkeys,

Wondering if anyone who's been in an equity position at a lifeco can talk about culture/comp/where they exited to. I'm currently working at a sponsor as an internal capital markets guy, where I finance deals once committee has approved the deal. This is about 70% debt or structured/preferred equity and 30% JV equity. I just graduated my MSRE program a few weeks ago and am really looking to target moving back to the equity side full time and have mostly been chasing private equity acquisitions opportunities. 

That said, I just got a call back for a second interview for an associate / senior associate level position with the equity group at a LifeCo. I'm a little less than all in because this isn't a top LifeCo but more of a second-stringer with a smaller CRE portfolio and would require relocation to another market (which I'm not opposed to but not completely thrilled about either). Having said that, it has gotten me thinking about the possibilities at other LifeCos and if I've been unfairly not paying enough attention to equity roles at non-PE firms.

Can anyone who's been in an equity role at a LifeCo talk about comp, culture, and exits? Did you feel like being at a LifeCo was a good way to learn to see the whole chessboard and become a more sophisticated investor?

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Comments (8)

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Jan 23, 2021 - 7:57pm

Thanks for the mention latinbanker 

Comp., culture, exit. Let's do this. 

So..comp 

Comp will be about 20% below REPE shops. Generally though, where as REPE may have higher high and lower lows - Life Co pay will be pretty consistent year to year. From analyst to senior associate I would expect (in the ballpark, for a high COL city) to start around $90,000 all in and progress pretty quickly to $110-$120K all in through analyst years. It'll continue to ramp up quickly whereas the top end of senior associate will be around the $200,000 to $215,000 mark. (Starting senior associates will be around $160,000-$170,000) 

Culture: 

Generally fantastic. You'll have your late nights, tough weeks, and weekend work. When I was on live deals I worked 6 days per week. But generally, Life Cos are chasing fully marketed deals so I had great visibility into my next few weeks. If I worked weekends (read: my 6 days per week) it was more because I decided to go home at 730 every night that week knowing I would put it 3-5 hours on Saturday or Sunday. When I wasn't on a live deal I could leave at 5 on the dot. Generally I worked 5 days per week. Monday to Thursday was until 630/730 PM. Friday the office was a ghost town by 5:30  

The people who get into Life Cos later in their career generally don't leave. Call it a life style firm. Hours are good and compensation is consistent. It's harder to move up as people don't leave, but it's a great place to make a solid living and work reasonable hours. Generally people will care about their lives outside of work and want you to relax and enjoy as well. Some of the Life Co's pay NY/SF salaries in their Atlanta/Chicago/Texas/Carolina offices so these people get even better life style due to the cost of living. Definitely be advised Life Cos are as corporate as real estate companies come. Highly structured and processed. If you don't do well in structured environments or don't want one, definitely determine in your interview how structured and processed this firm is. 

Exit: 

Great. You can easily leave to operators, developers, PE shops, etc. Everyone will know that because you worked at a Life Co you saw tons of deal flow and the reps that gives you provides great insight and feel for deals. People will pick your resume up because of it. You will be able to go where you want, and you never know - you may just stay.  
 

Happy to discuss further. Let me know what you want to hear more on or questions you have. I'm typing from my phone and can add if you want. 

Jan 24, 2021 - 5:37pm

This is really helpful information, thanks pudding .

A couple questions for you:

Where do MBA grads fall in that salary spectrum? It seems like $160K is light for someone 1) coming out of one of the better programs and 2) living in a market like SF/NYC.

Conversely, what is "market" for MBA grads at the a REPE shop?

Jan 25, 2021 - 11:23pm

Pudding,

Thank you, this was exactly what I was hoping to find out. Appreciate your thorough answer. Just to follow up on comp - around what ballpark would you estimate for the base salary in a Boston/DC type of market at say an associate title? I want to make sure my ask isn't undercutting myself but also isn't wild / out of touch.

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Jan 24, 2021 - 5:47pm

I don't have an MBA so I could be wrong but it probably won't effect your salary and bonus all that much. We are talking about corporate companies here. There are salary bands and ranges etc. If you go to a Life Co with an MBA you will still start around 160-170k all in. Generally it's because this is their range that they are allowed to pay. They can move in their bands, but that is it. If you manage to negotiate a high salary to start, eventually, it'll catch up to you because even if you perform really well, they can only pay so much. You may start high, but it'll level off over time. For a PE firm that pays market, add 20%. Real estate salaries are pretty all over the place, some firms may even pay less than the Life Companies. It just depends. I know plenty of people who did an MS and it didn't have an effect on their salary. I also know MBA's where it didn't effect their salary. It's firm dependent. 
 

I know you mention better programs and NY/SF, but I don't think the program actually effects salary range. It all comes back to pay bands. Going to an M7 doesn't mean you command a higher salary, it just means you have doors open to you from school which happen to pay high salaries. If you look at the data and see everyone from an M7 makes large incomes - you are forgetting the part of the equation of what companies they generally go to - those that pay high salaries. I've seen roles at good firms for 5 years experience pay $130k all in (High COL city). Real estate is not linear and as I said above, salaries are everywhere. On top of that, advanced degrees really don't do much for controlling that salary. 

Jan 24, 2021 - 5:59pm

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