Need help choosing a PE offer that will help me get to equity L/S in the future

Hey guys, I have an interesting situation at hand. I have always been most interested in doing bottom-up fundamental research at an equity l/s fund. But as luck would have it, I am currently deciding between two private equity offers. Both seem to be 'growth equity' funds. Pay is similar so won't be the deciding factor.

Fund A is a very new PE firm. They have committed capital and have already exited some deals, but have not yet raised an official fund. The principal doesn't come from a buy-side background, but has connections to find deals from his many years on the sell side. And connections to connect potential strategic partners to create synergies after investing. The level of analysis the fund does will not be very in depth. Modeling is kind of an after-thought. On the plus side, the hours should be quite manageable.

Fund B is also a new firm, without much capital currently, though they have plans to attract more capital and have backing from their parent organization which is a bit bigger. The manager does have several years of private investing experience. The level of analysis should be quite in-depth, with 100+ page investment memos (all done by one analyst), and various modeling scenarios. But the typical deal sizes are very small, comparable to VC deal sizes. Given the long and detailed investment memos, I think there will be quite some pressure involved in working in this role.

My ultimate goal is still to work in equity l/s. I know that PE is a good pathway to get to equity hedge funds, as PE analysts are perceived to have learned how to analyze companies in depth and adopted an investing mindset. If Fund B was a mega LBO fund, I would go for it no question. The thing is, is it really worth slaving away creating thick investment memos on very small-sized deals? I'm sure I would learn a lot working in Fund B, but come interview time with HFs in the future, when I say I was working on $5MM deals, they may just scoff at me. Maybe its better for me to work at Fund A, learn less, but keep my sanity, have time to follow the markets for myself, and make the same amount of money. What do you guys think?

 

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