What would you do in my shoes?

First, apologies in advance for the fishbaiting title. Feel free to MS me for it if the below does not interest you. To the rest -

Hello! Long time lurker here. Similar to others, I have found the WSO community to be incredibly helpful in my career decisions and to follow suit, I would like to ask the broader group what they would do in my shoes.

My background

  • Upper-tier Ivy Graduate

  • 3 years at at large US MBB office

  • Recently started at a MM PE fund (5-10B AUM) in the US

In short, through a network, I have an open position to be a leadership role (think MD/Partner level) at a sub-$200M fund in an APAC country (Tokyo/HK/Singapore/Seoul). The fund is only 1 year old and has no track record. The small team is very well pedigreed (Ivy + Upper BB IBD) but similarly has a limited track record. My base + bonus at the MM PE fund will be roughly the same as my base at the new fund but I will also receive large amounts of carry.

My biggest concern is my ability to add value and also invest in a different country from the US. My experience in PE has been <6 months and I wonder if I could actually lead deals and return decent MOIC. However, I also could see a world where I just throw myself in there and take, what I see to be, a opportunity of a lifetime.

What would you guys do?

Comments (5)

 
Sep 13, 2018 - 6:36am

How is your network in that country? LMM is all about sourcing and if you have no network and litle execution experience, it's hard to see what value you wold bring to the table.

 
Sep 13, 2018 - 10:17am

Nonexistent....I would basically just piggyback on the network of the founder and the thought is my value would exists more on deal execution and deal evaluation

Array
 
Most Helpful
Sep 13, 2018 - 9:53am

A few thoughts:

  1. I don't mean this to be offensive in any way. Joining a small / new PE shop is all about having faith in the team you're joining - and I see it as a major red flag that these guys would offer you a partner level role in the first place. You have no investing background whatsoever, and only three years of professional experience. Perhaps you've spent a ton of time developing a novel investment thesis or created a unique framework that you spoke about and they loved, but this would scare me otherwise.
  2. To some extent, your experience and proven ability to execute deals can be more important at a small fund like this. You're not going to have the resources you would have at a larger fund during the execution process (not going to hire Cravath to work on a $10mm deal), so you really need to have a solid understanding of all parts of a process. Again, don't want to totally discourage you - but that doesn't sound like you.
  3. Is this fund raised yet? It's a lot safer to join a fund that already has capital. Similar to the above point, if these guys just went out and killed themselves to raise capital, it shocks me that they're willing to give up material economics after doing the heavy lifting of putting a fund together.
  4. Do you want to live there? Carry will take a long time to materialize, so you are in this region for the long haul. By that point, your sourcing network, relationships, deal experience, etc. will all be in this region and focused on smaller deals. Without substantial US experience to fall back on, it will be harder to break back into a US focused MM PE shop should you ever want to return. Doable, but harder.
  5. All the above considered, very few people get that kind of opportunity. I'm a big fan of leaps of faith, when the faith comes form a belief in yourself. But one thing I have learned over my career is that no matter how good you are, you cannot succeed if you put yourself in an environment where you are setting yourself up for failure. The concerns I mentioned above are the first of many questions I would ask to see if this is or isn't one of those environments.
 
Sep 13, 2018 - 10:17am

Thank you so much for your thoughtful response and please be as direct as possible as that will make sure I make an informed decision. To answer your questions -

1) In short, the founder is a very close friend. Obviously doesn't assuage the red flag but does explain the rationale.

2) Completely agree - my understanding is they do have all resources e.g. third party providers but won't be best in class. With that said, that does not solve the piece that I will not know everything to the full extent, however, there are many veteran'ed advisors who are plugging in.

3) The fund is raised! So I lucked out there

4) I would not mind living there but the ability to come back to the US is an area of heartburn for me. I figured I could attempt to leverage the experience for a LMM here in the U.S., returning to MBB consulting or going to bschool. Maybe I won't be able to stay in PE but could likely come back to the U.S. Not ideal for sure.

5) In summary, I am leaning towards not going. I think there are a lot of red flags but I wanted to see how others would think about this opportunity. I feel like I do not even have the framework to even ask the right questions when evaluating this opportunity.

If you have further thoughts, I would love to hear them but appreciate your response!

Array
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