I haven't been on here for a while and I figured instead of going out tonight with the lady or reading a pitch-book I'll give back to the community.
Ask anything you want to know.
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1) Could you tell us about your background? Target/n-target , bb/mm i-bank, approx size of your fund, geographical area 2) Favorite/least favorite thing about MM PE 3) Lifestyle at your fund (hours) 4) Future outlook of MM PE
1) n-target, bb to boutique to PE,$350M, NYC 2) Favorite: My input counts even though I'm junior involved in all deal making/ least favorite would be the constant criticism from fund manager. 3)10:30am to 6:00pm at the office. but expected to be available 24/7 on email and calls. 4) will always be here although the US is starting to feel saturated. We are now looking into Europe, Israel and I have a bias for Lat Am.
What's the ball park compensation for pre-mba and post-mba at lower MM PE? (~500M~1B) Also, do you see more people from BB/Elite Boutique or Top MM banks at MM PE firms?
You've stated at the junior level all-in is about 250k plus carry if you sourced the deal. Do you know of any junior level employees who sourced a deal(s)?
Yes, Myself. By junior I am referring to analysts and associates.
Analysts/Associates don't get carry.
Not universally true, as there are funds who give carry to both.
You must be a salaried employee that only gets paid to do a certain function and isn't aloud to step out of the box.
Is the $350 m just the size of the latest fund or total current AUM at your firm? Do you know what is the fundraising situation like at your firm, in light of the difficulties facing many other MM shops? What is the investor base like? (mostly pension funds or endowments or HNW/Family Offices) Also do you guys have an in house general counsel? For comparable sized shops I have seen some that have in house legal staff while others outsource all to outside law firms.
Size of the latest fund. We all participated in the fundraising of the fund that is how I was able to negotiate my compensation. Fund raising is never easy but I guess the fact that our managing partner put in 3% of the target it helped a lot.
The investor base is mostly UHNWs, Pension funds, a couple of big family offices and many RIAs.
We use several service providers, no in-house counsel (not worth it).
What type of PE firm do you work at? How common are analysts coming straight from undergrad?
I wouldn't know how to answer that question; as far as our shop goes you will definitely need some prior deal experience.
Thanks for doing this.
1) Particular industry your fund focuses on? 2) The "right" or "better" way to go about MM PE recruiting (in your opinion) out of banking 3) Is your shop a 2 year & out deal as well? 4) The least favorite part of your responsibility within team
You are welcome.
1) We are industry agnostic but will only look into companies with significant cash-flow and assets.
2) Have them as a client, stand out from other individuals by showing them only deals that fit their criteria. Ask for a job.
3) I don't really understand what you mean but if you mean hold time before divesting. It is a 5 year and out shop.
4) Creating weekly reports...
Re: #3), I meant does your shop mainly hire guys out of IBD only to kick them out after 2 years? or is there a chance for you to stay on and be promoted without an MBA granted you perform well?
Bingo! That is how I got into PE from the sell side as well. A lot of people on this site tend to think in a very generic and narrowly structured manner when it comes to career transitions (2 years of IBD then go through formal PE HR recruiting channels or outside recruiters).
The best jobs are never advertised (or already filled when they show up on public job boards). If you can demonstrate value adds then the employer would create a job just for you.
Also I think what the other guy meant to ask was whether your firm has a police that associates must quit to get their MBAs after a 2-year stint before (possibly) get hired back to a partner track, as is standard practice for mega-funds but not at many MM firms.
Were you reached out by headhunter for your currently PE job?
No, I never talked to headhunters. All networking.
My bad, meant to give a banana : \
10:30 am to 6 pm...WOW. These are not typical hours for PE.
Says the investment banker.
If those are common hours in PE, I am leaving right now. I mean I know PE hours are way better than IB, but that's not even a 40 hour work week. Time for me to leave now.
1) What qualities have you seen in the associates that were able to make it to the VP level? Is more emphasis placed on your ability to do analysis/due diligence or your ability to manage the deal process (manage relationships between lenders, management, sell-side)?
I know the answer is probably both, but what is more valued in a senior role?
2) As you've seen more competition in the middle market, how have you guys managed to make good returns off of higher-than-normal purchase prices? Have you guys stayed away from processes in which many sponsors are interested in the deal?
Thanks in advance for your time and answers.
1) Be outspoken about companies and the emphasis is more on deal making and thinking outside the box. There are thousands of analysts out there.
Deal making and being able to have a CEO like you is way more important than numbers once you figure out they work.
2) We have a committed fund and don't need sponsors in our deals. If we don't get the price we want on a deal; we move on to the next. Most of our deals are proprietary so we do not need to worry about auctions. There is a lot of competition in the MM but we have a prop source which has value add to our investors.
I will be answering the rest of the questions later on tonight. Sorry, got a little busy.
How would you recommend getting an internship for an upcoming jr at a semi target school? (Rutgers)
What advice would you give to an undergrad who wants to break into PE?
Start in IB even if it is a small shop but make sure there is PE exposure. look into All Cap Corp and aleutian.
have great numbers skills and people skills. Be HUMBLE
I am in an MSF program. If I am unable to find a job in IB, what would be the best places to start in hopes of lateraling over to IB in hopes of eventually getting into PE? Some have suggested places like Duff & Phelps valuation, Big Four valuation, and places like Moody's. How hard would you say it is going from a no-name boutique to a top MM or BB?
If you have no interaction with PE funds you wont be able to just "get in". Unless you answer an ad and somehow get the job. You have to have some sort of value add in order to "get in".
what groups were you in at the BB and boutique?
Great question! I started out in a BB's Wealth management group then moved on to a MM boutique bank's S&T desk and from there we got taken over by a well respected PE advisory firm where I did a lateral into IB. my job function in IB was to develop relationships with CEOs over the phone and find their needs where we did the whole gamut of finance. I learned a lot because every MD I worked for made me read a ton of text books (probably about 25 in total) and I am learning something new everyday.
But, the one thing many people have told me is a gift I posses is the power to be able to make anyone laugh.
Jesus. That sounds horrible.
An equity investment analyst / associate with 3 yr experience at an AM with macro focus. Not much modeling in the job.
Would he be desirable at any PE firm? If so, what qualities? Thanks!!
I don't see why not. Especially if you have contacts in AM and are able to get some money in a firm looking to raise a new fund.
Do you have any advice for a top tier strategy consultant trying to break into PE? In your experience have you seen many consultants in MM PE? If so, which firms are open to hiring consultants?
One of the partners was a partner at KPMG so my advice would be to reach out. I don't know which funds hire consultants. sorry.
Do you overall really enjoy your job? Do you find it rewarding and do you feel accomplished at times? What about your career path, are you proud of yourself, looking back on it all?
What do you think you want out of the PE industry? In other words, do you think you want to do this for 5 more years, 10 years, 20 years?
I Love the last one. I dream of something similar all the time.
What would be one piece of advice for someone who is starting in IB next year and would love to work at a PE fund the size of your fund?
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