Senior Associate Comp Benchmarks

I just got an offer for a sr associate position at a fund with ~$2bn, but was disappointed by the comp package outlined in my offer letter. Hoping you kind folks could help provide some data points and/or insights. I'm short, terms are $125 base + $125k bonus + levered coinvest. No signing bonus and $5k in relocation reimbursement. The latter is a head scratcher considering I have a full apartment across the country from this role and definitely wouldn't cover moving expenses in full. Also worth noting role is in Florida, where there's no state tax.

Comments (34)

Jan 11, 2022 - 8:41am

250k total comp for someone with what, 4 years total work experience? Plus you get co-invest opportunity and don't pay nyc taxes?

Seems slightly low but not disgustingly low.

If you always compare your offers to Warburg Pilon us numbers you're gonna be disappointed. Try instead to see if there is a path to working there long term and ask the other senior associates and vps at the firm how their comp progressed.

  • Associate 3 in PE - LBOs
Jan 11, 2022 - 11:03am

Pretty tight on comp relative to fund-size, but location-adjusted not terrible - I'm at a $1B NYC fund making $300k cash + 50 bps carry + levered co-invest, which I think is on the low end for NYC cash but probably closer to high end when factoring in carry. 
 

I wouldn't sweat the cash differences at this level - bigger questions are whether you see a long-term role here. The prospect of making VP or Principal, particularly at a place with solid returns and fundraising, will blow comp differences at the Associate / Senior Associate level out of the water

Jan 11, 2022 - 12:57pm

Maybe a tad low, but not shockingly off-base in my opinion. Senior Associate comp is generally closer to Associate comp than it is to VP. Add in a non tier one geography and a MM focus and you're not going to be getting some of the comp figures that are thrown around here.

If you really want the most accurate comp check you can get, reach out to recruiters and ask them for comp ranges. They can usually get you really specific comp figures based on geo and fund size. 

If you like the geo, like the team, think you can get from Senior Associate to VP in a year or two, and generally see longer term potential at the fund, then I'd eat the ~$50k.

Last thing, if you're really unhappy with the comp and it's borderline pushing you to not take the role, I think you can respectfully go back to them and express that dissatisfaction and see what they say. I would do your research though and make sure you have a good sense of market for that region, which is why recruiters are helpful. Going back and saying something like "Thanks for the generous offer, really excited to join the team, see a lot of opportunity to grow, etc etc with that said, the total comp package is a little lower than what I was expecting. I'm seeing market ranges of xyz and in addition to that, I'm moving my entire apartment across the country, which the $5k relo likely won't cover. " 

Comp discussions can be tricky, I've found that in PE some folks expect you to negotiate; however, some partners for some random reason really take offense to it (despite that fact that we all negotiate for a living...). Personally, everytime I bring up comp, I kind of know that I might be burning and bridge and I really try to determine whether it's the hill I want to die on. If you pushed them for more comp and they pulled your offer would you be upset? All things to think about. 

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  • Investment Analyst in HF - EquityHedge
Jan 11, 2022 - 6:37pm

For what it's worth, was in a similar position back in the day - was disappointed in senior associate comp and decided to leave a couple years back. My advice - go to a place that pays you well. The labor market is incredibly competitive right now. Good places with good leaders will pay for good talent. If you go to a subpar place with subpar leaders who don't truly value talent and don't fully believe that people truly matter, what are the chances that they'll pay you full price? They won't. If they don't pay you full price as a senior associate, when all we're talking about is an extra $50k, what are the chances they'll pay you well when you're a principal? When you're a partner? If they're cheap about $50-100k, what are the chances they'll be generous when the difference is going to be $200-500k in cash comp as a VP or Principal? Think about it.  

From my experiences since, when you join a good place with good leaders who really understand that they need to pay people to keep the best people, you'll feel a lot better. Always find places where you'll be valued for your full skillset. Don't settle for subpar pay. There's a lot of shops out there today - this isn't the 1990s when there were like 10 PE funds. There's thousands of investment firms these days. Go get what you deserve. 

  • Associate 3 in PE - LBOs
Jan 12, 2022 - 3:17am

All depends on how much you bring... I moved a 1bd from Texas to NYC a few months ago and it cost me ~$10k. When my family moved from GA to TX as a kid it was closer to $40k (and that was 20 years ago)... though obviously a big difference when moving a large house. You can certainly do it cheap if you drive a truck and all your stuff fits in the bed, but if you have people pack and ship it, which really isn't that much of a luxury, it adds up fast

Jan 12, 2022 - 3:36pm

Other people have covered the whole maximize pay thing, but I'll bring another way to look at this. Lots of people need to take a step back and evaluate if they're realistically going to become a PE Partner / whatever senior role.

The argument of accepting lower cash comp for better career advancement / economics down the line is mostly predicated on staying at the same firm for the next 5-10 years. In this day and age, I just don't think that's realistic. Putting aside self-selecting out of PE (which a LOT of Associates do), shit happens in life. Maybe you find a firm that promotes only from within and you have a "clear path" to making VP/Principal/Partner, but pays you 50K+ less than street? Something can happen in your life that either forces you out or forces you to re-evaluate where you want to be after a few years in your role (shitty culture, WLB, industry, life event, anything). Then, you're out a few hundred grand of cash that you'll never get back. Sure, that's a drop in the bucket compared to the millions of carry payout you might get down the line, but until that money is in-hand/fully vested, it's not really "yours." 

Separately, I think the comparison of money on this sub as a whole is skewed. $50K is a lot of money to me and a lot of other young people, especially if you're not from a well-off family and graduate with debt and/or minimal money in your bank account. I am not operating under the assumption that I'll be making mid-to-high six figures in 10 years, or that I'll be nearly as hardcore career-driven down the line. So if I'm in the trenches working my ass off, I want to get paid commensurate with the market, especially since there's no guarantee that I'll be here long-term (and statistically I won't be, whether or not by choice). I'm not saying I'll literally kill myself to work at APO for the bands, but that I would seek to maximize comp at comparable firms.

Companies as a whole don't give a shit about employees and are focused on themselves. In turn, it's not wrong for people in the labor force to then act in their own best interest, especially nowadays where there seems to be a lot of soul-searching among people for what they want to do for the rest of their lives.

  • Associate 3 in PE - LBOs
Jan 12, 2022 - 7:09pm

I'll give you a datapoint - in Florida, smaller fund size, $130 + $130 and levered co-invest. Some random exit bonuses bring it closer to $300. I didn't push on SA comp because it's a growing fund, solid people, and some much bigger numbers at the VP level. 

Idk, you have a bird in the hand. Doesn't seem too unreasonable for the geo, but you probably have a bit of wiggle room to negotiate or at least get some clarity on what VP looks like

  • Business School in PE - LBOs
Jan 12, 2022 - 7:16pm

Lobbing in data point at $5bn-$8bn fund non nyc. Total comp for Sr AS is ~$410k + levered co-invest, no carry. ASO 1 is $300k + same co-invest.

  • Associate 2 in PE - LBOs
Jan 12, 2022 - 7:18pm

This is a pretty interesting data point. I'm at a similar firm with higher total cash comp but our co invest is unlevered. 

  • Business School in PE - LBOs
Jan 12, 2022 - 7:22pm

We got a little bump after the bankers. Just for clarity, the firm doesn't lever our co-invest but facilitates lending through relationship with bank so there's about 3% rate on ~70% of the check. It's not free free money.

  • Associate 3 in PE - LBOs
Jan 13, 2022 - 10:31am

Based on what you've heard, do you think your comp package is in-line with market? My profile is almost the same as yours. First year senior associate at $5-8bn fund, non-NYC.

  • Business School in PE - LBOs
Jan 13, 2022 - 9:01pm

I think so but curious on your data point. Sounds like my comp is right around market. Sure there are some higher comps out there but if I'm being realistic, we are ~market especially COL adjusted.

  • Associate 2 in IB-M&A
Jan 13, 2022 - 3:02pm

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  • Associate 3 in PE - LBOs
Jan 13, 2022 - 5:47pm

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