First-year analyst at top NYC EB and beyond crushed on. I wanted some megafund when I was a senior, but now I just want a job where I can have a life. Are there ANY PE funds in the mm space that have a <60hr/wk wlb?
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Look at some mezz funds and some maybe minority/structured equity funds. Lower middle market too. You’d be a shoo in and maybe the deals aren’t sexy and you will def take a cool haircut but WLB is good
Why not just Corp Dev if you are going after WLB?
EB RX group and historically no one at the group has exited to corpdev. Also, want to stay in a relevant space as I do find it interesting, just hours matters to me a lot more now.
Ah experience, the great teacher.
MM Special Sits/Opportunistic Credit.. 2nd Tier City. 9 am to 8 pm.. No weekends. 100 base and 50-70% bonus... Interesting deals, great hours and never missed a family get together.
Lmm pe would likely pay more than Corp dev
Same situation. Might just go LMM PE (Like a $500mm fund), have heard decent things but obv. depends on the specific shop.
LMM PE is the way. Gets a bad rep but its a good life
100% accurate; I'm in LMM PE and my work weeks are 40hours MAX.
What’s your fund size and how many investment professionals roughly?
How does that even work? Why does a smaller fund size equate to less work intensity? If anything in my experience it’s been the opposite. The smaller companies and family owned companies are usually a ton of work because they’re not even close to professionalized.
The smaller targets have less infrastructure and reporting, so it’s even more work to diligence. Your fund size is subscale so you have to run a super lean deal team, you don’t have the scale to burn a few hundred grand on broken deal fees to advisors/lawyers/bankers so you’re the one doing all that work, you’re not a real attractive fee payor so there’s no bankers/advisors willing to do free work for you to invest in the relationship.
Just curious.
Does it really get a bad rap? Why?
Bad rep from people on here who think MF/UMM or bust. Also because pay and exit opps are not as good. But the exit not as necessary if it’s a sustainable lifestyle.
I was dead set on MF PE and now I wish I would have recruited for LMM.
LMM is hit or miss. Some really firms are run by talented and creative investors and others are run by guys that you wouldn’t want to learn from. Base case outcome (from a learning perspective) will be a lot higher at a larger fund, and you can always move downstream when you want to
I’ve got friends at sub $500M funds who get crushed too because those tiny funds have no overhead so you wear every hat... a small fund is no guarantee of a cushy life.
For some reason WSO changed recently where you can't use the less than sign or else it cuts off the rest of your message, FYI.
To answer OP's question I feel like the reason these are so rare is because often once people are in those seats they don't leave precisely because WLB is so good for being in PE, and those shops are usually smaller and there's just a lot less info available out there about them. Definitely firm dependent too and it's not as easy as saying "oh just join any fund that's sub-$x"
Any insight on how to diligence for funds like this when interviewing
Thanks fixed - point being smaller funds are no layup
I have also heard this—and deals are small so theres just way fewer resources and they get stretched and the associates have to do way more time Bc target Co’s aren’t sophisticated
This is very true but you add a lot of value here and you actually get some good experience out of this work. It also sets you up better to do an LBO personally or with friends or a LMM Search Fund because it’s an amount of capital that you can usually source as an individual with connections
You can suggest them to outsource some of the work. It's quite effective and helps in the long run. Check out Acuity Knowledge Partners. They have end-to-end support for all kinds of PE and VC work.
I'm at a single family office doing direct PE deals for a well-known multi-billionaire family, after a couple of brutal years at a top BB. Lifestyle probably hovers around ~60 hours a week (with no weekend work) unless there's a sprint for a deal. I do take a haircut on comp relative to traditional PE funds, but the work life balance is much better and they won't kick me out after X years like some funds do.
Mind if I ask about comp and trajectory?
Family offices & UHNWs are the bomb in LMM/MM space in my opinion. More flexible time horizons and usually bring some added value to the table as an LP/platform.
but how do you find the names of these family offices?
Can you share your views on future opportunities after your stint in a single family office? Does it weed out future opportunities (including return to PE)
Also, is carry typically deal-by-deal given the nature of the fund source?
Much appreciated
I’m in a LMM PE right now and considering a move to a single family office doing PE
also wondering
Don't know in US. In Europe working ,60h/week in PE is feasible. It depends on the fund culture - Your MD
Where? Fund size?
If interest is in LMM or MM direct buyout/lead, look at single/multi family offices that focus on these types of deals (i.e. Pritzkers and the like). Can't speak to Pritzker specifically but generally I hear the hours are more "reasonable" and can average out in the 60-70 range (obviously when you're closing, it ramps up to your expected 100/week levels for about a month but that's typically only 1-2x occasion each year).
Worked at one myself - typically it's going to be smaller, non-NYC type firms (NJ/CT/Westchester if you're targeting northeast). A good barometer is the background of the partners and deals per fund versus associate headcount. If they're all from MFs, senior BB M&A guys, or from sweaty shops in general, they will probably grind you.
Might be worth looking at private credit, too. Lower risk-return profile but same deal based environment, 55-70 hours, 90% of MM PE comp, no MBA 2-and-out requirement.
I'm impressed with this comp metric, would have expected a bigger haircut (around 75%) at your run of the mill unitranche / stretch lender. Any idea what the overall numbers look like for Associates ($200-$250k?)
$190-225 is what I hear for A1 these days with annual bumps to the 225-250 context after that
Top shops expect to clear north of 300 as an A1. Very few of those though admittedly. Nyc rates are probably more like 225
Fair to assume carry in long term is also smaller? As deals are more conservative hence lower returns ?
Honestly not sure. Sometimes your credit fund is 2-3x the size of your LBO fund so gross carry dollars could be higher despite lower returns? You also realize returns faster since average hold time is shorter.
LMM PE is the move. Roughly 60 hour weeks. Good culture and camaraderie. Deals and businesses are fun to work with. And by any normal person's standards you can still become incredibly rich.
Currently at LMM PE shop where we work maybe 55 a week on average, gets down below 50 in the summer and around holidays assuming no deals are going on. With deals it usually looks more like 70 or so, which still isn’t that bad all things considered.
Dealflow is pretty sleepy. We run hard at maybe one deal a month, and typically only close 1-2 per year. Our goal is to be ultra-concentrated (5-6 investments per fund) so the light dealflow isn’t a death knell in terms of deploying the fund. Fewer portfolio cos also helps you focus time on the handful of new deals we’re looking at.
I’m a little concerned about prospects if I end up needing to lateral, but luckily there’s no 2-and-out program here. I won’t get rich here, but it’s a nice balance in a MCOL city
Tons of LMM PE funds though and they all know eachother so I think lateraling can work
I'd be careful with the LMM PE advice. Sure, some funds may offer better WLB than others but a large % of LMM PE funds are super hands-on with portcos and involved in several deal processes so they are jammed on the resources front. Not the best bet IMO to go to a LMM for the WLB unless you know that specific firm has a culture like that.
A safer bet is usually something like a permanent capital vehicle or a family office, though those opportunities are generally a bit more rare.
There are funds like this, like prudential private capital, where WLB is good. Pay not as good. But you are correct. I have to imagine a place like Trivest doing 85 deals in 2 years is pretty intense and not a “WLB” shop
I'm about to go to a LMM shop where the feedback from past associates has been WLB is pretty good, hours are pretty good except for deep into live delas. However, it appears the culture is not great and the partners don't really connect with the juniors. Any advice and has anyone been in a similar situation?
Right now in IB I'm in the opposite situation where I really like my group and we all get along nicely, but its been grinding 100 hr weeks for over a year now.
I’m in same situation where partners kind of do their own thing and you definitely work “for” them vs “with” them. You won’t like it at first but then you’ll get over it because it’s a job and who cares, as long as you think they go to bat for you when it counts (bonus/exit)
Great, thank you. All W alum so hoping they'll help out there
it exists
Know its not the focus on this sub but currently at an UMM ($6bn fund), never experienced <60 hours but have been averaging ~70ish hours (9am~10pm with 4-5 hours on sundays) with pretty solid comp (~$250k all-in) so honestly can’t complain here.
Of course once every other month you have that 100+ hour week when closing deals. So there definitely could be some type of W/L balance even at the larger shops.
Does this make you want to stay in the firm if there's a pathway to senior asso / principal promotion? Going into a similar fund so curious about your perspective.
At the end of the day, it's entirely driven by the people/strategy versus fund size. The guys that want to crack the whip on juniors and generate the highest fees/do the most deals will more likely be at the larger funds. That's not to say there aren't hardos at the sub $500mm funds, just fewer of them.
I'm at a MM firm (~$10Bn AUM), so can provide some relevant thoughts. You should watch out for firms that are highly acquisitive / pursue rollup or build-up strategies. What this actually means is that on top of doing normal PE Associate work (i.e. evaluating new investment opportunities, building models, etc.), you could end up getting completely buried in add-ons and other strategy work for your port cos. It's pretty interesting stuff, but has been worse hours than banking for me and the other associates all concur. I'm looking at pursuing other opportunities because I just can't live like this anymore.
Sounds like Audax?
Not Audax, but similar model
Got donkey fucked in LMM as did my peers in other LMM funds. You look at shittier companies with way less resources than those at UMM/MF PE and your optionality + economics are significantly worse. If you want lifestyle, PE is not where you should be. If you still want to be involved in deal space look at family offices or if you're interested in investing, go to the public side.
Out of curiosity are you and your friends in NY/SF or smaller market cities (chi, bos, Dallas)
LA
Family Offices are the hidden gem of finance
Careful with family offices. These vary hugely in size and sophistication.
On the low end of the spectrum, you are at the risk of being at the mercy of one very rich person who is used to having domestics and servants working for them and will be working on random deals coming from dodgy connections
on the other side of the spectrum it wouldn’t be very different to the more sophisticated funds (EQT was originally a family office)
Also, the pay is coming directly out of their pockets and it's possible that they wake up one day and fire everyone/outsource to their friend's firm etc.
Work at a ~$500mm structured credit fund and WLB is pretty ideal. Most weeks are 50 and heavier ones top out at ~80 when there are multiple deal deadlines.
That structured credit as in Securitized credit? Also how’s comp look for an Assoc1 - Assoc3?
Structured Credit as in senior lender with equity kickers in each deal. This is primarily in the energy space.
Assoc 1 should be around $170k all in. Not exactly sure how comp will progress over the next few years, but fairly lean shop.
Hi OP. I work less than 60h a week, but not in a London / NY kind of city. A smaller European city. Fund size is >EUR 300m. Small team of 10.
Comps is a lot lower but overall I am happy, work on interesting stuff and I have a life outside of work.
So yes, it is possible but you would have to make some sacrifices
Late reply, but how do you find funds in this kind of smaller euro city? Is it harder without speaking the language.
I speak the language so not a problem for me. I think for multi-office PE firms, not speaking the language is fine as most times they have people from other countries and speak English in the office. I work for a regional firm so language is a prerequisite but luckily I speak it
LP chiming in here...
I think people are defining LMM firms differently. In general, let's call LMM funds $250mn-$1.0bn and anything less than that as micro cap. Within this space, you could see a range of approaches--firms who are small and want to stay small, Fund I/II spinouts from established firms starting at the lower end of the market to raise LP capital, or more niche strategies (sector specialists) where fund sizes are restricted by the focus on opportunity sets.
Some here are talking about firms that are dedicated LMM specialists in non-core geographies. I would expect these firms to be less polished, have lower deal velocity, pay less, but have better work balance. For spinouts (ie firms led by GPs spinning out of megafunds/upper middle market), I would expect there to be no change in WLB. These GPs are used to working with associates that constantly grind and likely will be working just as hard alongside them as they build their own firm. At these spinouts, you would likely have more of a long term, potentially partner path as a junior investor.
So, TL;DR, do your homework. Look at the pedigree of the partners and do your referencing to understand the culture. No two firms are really that similar in the grand scheme of things, especially at small shops.
I am at lmm pe with
But I have to bear 35k base salary. No bonus given so far, and I doubt I can get any anytime soon.
Is that a gvt owned vc? French state have those. Great dry powder but companies and deals you look at are tiny and you make no money
Very fair question you're asking and hope you're able to catch a bit of a break soon. Generally speaking, it's tough to find PE roles that guarantee a certain set of hours, as the biggest destroyers of WLB are process timelines. Even at a MF/UMM, you may have a stretch when you're just working on early stage opportunities, and then the hours are like ~65/70 hrs per week, which isn't terrible. However, even at a smaller fund, if you're in the later stages of a deal, you're inevitably going to have to go through the natural aspects of the PE job that create the tougher hours e.g. diligence, IC decks / memos, etc.
What's very messed up (at least from what I recall in banking) is that people somehow continue to market that any PE role in general will be better than banking, and that just isn't true. For the most part, unless you get very lucky with the shop / team / vertical, PE is 100% banking 2.0 - as a side note, a few of my friends thought they were going to "lifestyle" groups at smaller funds and they were definitely wrong...at a certain point it's challenging to also figure out what someone is marketing to you during an interview process / what you hear from friends about lifestyles is actually true or not. Hope this helps!
Does this hold as well for lmm funds, < 1bn fund size?
I really hesitate to make generalizations and if WLB is the single biggest criteria for you, then I would try to diligence the below aspects as hard as you can
(1) partner vs. associate ratio - a lot of smaller shops are pretty lean or maybe they’re just starting out, hiring patterns are less predictable and if you don’t have many associates per partner then the few associates are doing everything; even MFs who might be starting satellite offices...for the first few years they might be testing out the headcount and only have a small group of associates which can also pile on the work fast
(2) dry powder left in the current vintage + prior vintages not fully deployed - if there’s dry powder left and if deployment is behind schedule, you best believe people will be hustling, which means sourcing more opportunities
(3) ratio of proprietary deals or bank processes in vintages - this one is pretty hard to assess as an outsider but definitely a question you can ask during the interview process, the more proprietary the deals the more you have a chance to not be working on bank deadline schedules which like I mentioned above is what kills WLB
(4) is the current vintage one of a first handful of funds raised - a lot of LMMs are spin-offs of larger platforms and etc., so managers / partners are very much incentivized to knock it out of the park for the performance of the first few funds, which again can drive a lot of incremental work
(5) the average tenure of associates and is there an existing track record of promotion - the higher the promotion ratio, the more the fund is encouraged to nurture you and not totally burn you out
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