I was wondering how pay is structured at such a small firm like this? There is one MD, one VP, and one Associate. Investment criteria is $15-100mm Revenue and $2-$10mm EBITDA and they currently have 3 portfolio companies.
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What's the AUM? I'm assuming this is the firm's first fund?
mrharveyspecter not really sure, but they are funded mostly by one family
mrharveyspecter I believe they recently sold a portfolio company for around $10mm after keeping it for 8 years and claimed to make a 10x return for the investors after the sale
I would be able to give a better estimate given AUM and the fee structure, family offices can be structured a little differently. I would assume slightly lower than usual base + bonus with the one partner having most of the carry and distribute a little bit to the VP(and maybe the one associate). Small chance that the VP could have a good amount of carry based on entering while the firm is so small and the fact that if he/she has PE experience that they might be taking a pay cut from a larger firm in return for more carry. Based off of a 2/20 structure I'd just break down what 2% of the AUM comes out to, subtract some for operating costs like rent/travel, etc, pay the associate and VP slightly below marketing rate (75-80% of a usually MM fund due to firm size and age) and give the rest to the partner.
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