WSO Podcast | E72: Principal in Private Equity - "Do This as Much as You Can"
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In this episode, @PIKtoggle shares his path from semi-target school to working two grueling years as an investment banking bulge bracket analyst. Learn what it's really like behind the scenes and how he was able to successfully pivot to private equity in 2008 even though he was very late to the typically "on-cycle" recruiting process. Listen for his advice on how to deal with recruiters but also how much carry bonus one should expect as you rise through the ranks in private equity.
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WSO Podcast (Episode 72) Transcript:
Patrick (CEO of WSO): [00:00:06] Hello and welcome. I'm Patrick Curtis, your host and chief monkey, and this is the Wall Street Oasis podcast. Join me as I talk to some of the community's most successful and inspirational members to gain valuable insight into different career paths and life in general. Let's get to it. In this episode, Pik Toggle shares his path from Semi Target School to working two grueling years as an investment banking bulge bracket analyst. Learn what it's really like behind the scenes and how he was able to successfully pivot to private equity in two thousand eight. Even though he was very late to the typical typically on cycle recruiting process, listen for his advice on how to deal with recruiters, but also how much carry bonus one should expect as you rise through the ranks in private equity. Enjoy. All right, , toggle thanks so much for joining the Wall Street Voices podcast.
PIKtoggle: [00:01:05] Yeah, absolutely happy to. Happy to be doing it.
Patrick (CEO of WSO): [00:01:07] So it'd be great if you could give the listeners a quick summary of your bio.
PIKtoggle: [00:01:11] Sure. So I've been out of school now undergraduate for a little over a decade at this point. I went to school in the Northeast, was in a program specifically within management, but also had a nice mix of arts and science classes, along with the undergrad management classes. I did a summer internship with a major Wall Street bank during the summer in between my junior and senior year really enjoyed it. It was everything I had hoped it would be in terms of drinking from the fire hose and just learning everything about the sell side in the context of the small group that I was in and decided, you know, I interviewed a little bit after that summer when I was a fall semester senior, but really decided that I wanted to go back to that group for four full time. so graduated in 2008, which was quite the interesting time. I didn't know it at the time when I graduated in May. But right after training ended in August of 2008, the world kind of went to crap. In September of 08, and so that's how I started my investment banking analyst career.
Patrick (CEO of WSO): [00:02:28] It's kind of crazy. Then what happens? Then what happened? You get fired. Or, you
PIKtoggle: [00:02:33] Know, I actually didn't we? My group was mostly unscathed in terms of analysts. We had one or two out of our entire class that was let go. But for the most part, everyone hung in there. yeah. You know, the unfortunate side effect of everything that was going on in the financial world at that time was unless you were in heavy restructuring, the life and death was pretty busy. I was in the consumer business services group, so it was a lot of pitch activity, which was good from a learning experience. But over time, the pitches became pretty similarly. And oddly enough, amend and extend was just the of the month of the quarter flavor of like two years.
It almost was a situation where a lot of banks and owners were scared into, you know, a place where it was just stasis mode. And unless a company was running out of cash, they're actually capital markets or M&A wise. There was just not a lot of activity. And so I think I might have arrived at the natural conclusion that banking wasn't for me forever, maybe a little bit sooner than had I been a little bit more busy, but probably 12 to 18 months on in my career, I started thinking about what the next chapter would be like.
Patrick (CEO of WSO): [00:03:51] And that's late, actually. Nowadays, they're interviewed for private equity, right when they hit the desk. Now, I don't know.
PIKtoggle: [00:03:56] Yeah, I know which, which is totally different than when I was around. And quite honestly, like, I don't know how I'd be able to find a job today on the buy side if that were the case, because I didn't even know, I didn't even know which way was up and I had done my summer analyst, and I still didn't feel like I really knew what I was doing when I hit the desk.
Patrick (CEO of WSO): [00:04:15] Yeah, it's interesting when I was an analyst as well. I didn't know I didn't start recruiting till my second year, and I didn't have a job lined up to like three months before, which sounds like it was plenty like a normal process. Yeah, but nowadays they'd be like, What do you mean? You're like two years behind?
PIKtoggle: [00:04:30] Yeah, yeah, you're like the dregs of the analyst club. Yeah, exactly.
Patrick (CEO of WSO): [00:04:35] So you're kind of you're figuring out like in a year or a year and a half and you're saying this is probably not for me, maybe partially because of a lot of the pitch, work and whatnot. So you end up eventually get to the buy side, correct?
PIKtoggle: [00:04:47] Yeah. Eventually, get in the buy side. And I would probably characterize my path as a little bit unique, both from just how the world was when I was interviewing. I also wanted to get to a very specific geography, so I was in New York and I wanted to get back up to Boston, actually. And so that limited the universe of not only were there not many groups interviewing to begin with, but that limited the number of groups out there that I that I was actually having real conversations with. I was also I was using recruiters, a lot of the familiar names out there, but also doing a little bit of legwork on my own. and so ultimately interviewed with three or four different groups and came across the group that I eventually joined and was really interested in quite a different model than I had been exposed to while I was an analyst, certainly in an industry group. Most of what you experience in terms of your buy site interactions are either growth equity or big elbow platforms, either for the supplement. Market or lower middle market, the group I ended up joining was actually a little bit more special, situation focused and a lot of what they were doing and what we still do, I'm actually still with this group is more debt oriented. Secondly, and unsecured and I was really interested in that approach in that investment methodology and structure. And one of the big reasons why
Patrick (CEO of WSO): [00:06:23] Before we go into the into depth there. So you've been there for a while now, right?
PIKtoggle: [00:06:28] Yeah, just like my nine year anniversary. so I'd love to dig into
Patrick (CEO of WSO): [00:06:31] That more later. But let's go all the way back to undergrad first. Let's start from there. So you kind of went to undergrad. Was it was finance and investment banking always on the radar? Or when did you kind of hear about it? Start prepping for it? And how did you end up finally landing that kind of critical summer internship?
PIKtoggle: [00:06:50] Yeah. So almost no to both of those questions in terms of what was on my radar. I grew up my father's an engineer, and so I always had that mind in terms of really enjoying my math and science courses in high school and hating everything else like English and history, basically like things I actually had to write, right? I just would. I really enjoyed my calculator and that was about it. So and so I knew I wanted to do something in that vein. Looked at some colleges and undergrad programs that had engineering ultimately just didn't love the set I was looking at. And so ultimately landed in the northeast at a school that had a pretty, pretty rigorous management school at the undergrad level, but also had an honors program within it. And that's what I that's what I really liked. And so for me, is was I don't want to say process by elimination, but it was a confluence of factors that led me to decide to go to this one institution. And then while I was there, freshman and sophomore years, I looked at the upperclassmen above me and those guys and gals that are really respected. It seemed like everyone was going to this thing called investment banking. I had no idea what it was, but that's what they were doing as junior interns and after school. And I felt like if I want to go do the next thing that's really going to challenge me, that's what I have to go do.
Patrick (CEO of WSO): [00:08:16] I feel like it's the same thing with me. I feel like it's almost like for kids that don't know exactly what direction to go as a first step, it's a great step because it leaves so many doors open. Yes, and it's funny because even at. Williams, where I went, it was like a small, liberal arts college, it is a huge feeder into to Wall Street, especially on a per capita like a per student basis compared to some of these other large cities. So it's kind of interesting because you just start hearing about it through the career and the career, like it's like management, consulting, investment banking or like. That's basically it. Yeah. What do you want? I don't know if it was similar at your place, but so you kind of the people you respected that in terms of respect, you mean like just they would get good grades. They were smart.
PIKtoggle: [00:09:04] Yeah, they were smart. They were seen amongst their peers as like leaders in their own little class. They were also part of the same honors program. And so I actually got to interact with them a little bit and I personally respected them. But you just you got this feel like they weren't the kids that were just showing up to class and sitting in the back and goofing off, although I did my fair share of that. Oh yeah, yeah. You know, they just they took it seriously, and I felt like I didn't go to school for athletics or anything like that. I really went to school. But to have a good time, but to ultimately prep for the next stage of life and my ultimate career. And so I was
Patrick (CEO of WSO): [00:09:43] It like sophomore year that you started prepping for this? Like, when did you start dropping where there are like on campus recruiting? Or was it limited?
PIKtoggle: [00:09:50] Yeah, it was. It was sophomore year that I went to a lot of on campus recruiting events, and the usual story was like, Listen, we're not taking sophomores for these roles. We're really juniors, but at least got to know and develop relationships with some familiar faces that I would then see again the following year. There were also some really small programs, like one or two week events. I recall doing something with UBS. I think it was my sophomore year. It was either over winter break or over the summer for like a week period where I got to go and it was a rotational program. So one day we went to the Levin desk. The other day we went to the trading floor, sat next to a trader you like, bought a barrel of oil for you and you, like, tracked it. maybe it wasn't a barrel of oil, but it was like some sort of commodities linked thing that you had to tell them when to buy and when to sell. So just to give you a flavor for the options set out there. And so it was little things like that, both from an interest standpoint. But I also said, Hey, listen, if nothing else, this is going to show well in my resume that I really am interested in this. And I've also got, you know, I'm taking the steps to actually really pursue something here
Patrick (CEO of WSO): [00:11:00] And you're like doing finance and accounting, and I assume your GPA was pretty high.
PIKtoggle: [00:11:04] Yeah, it was I sort of majored in finance, both finance and accounting and GPA. I had heard that, you know, you have to be above like a three six to even be in contention. And so it was it was where it needed to be.
Patrick (CEO of WSO): [00:11:19] And so you kind of start with it, a resume drop that got you the first round interview for the summer analyst spot.
PIKtoggle: [00:11:25] Like, yeah, it was in terms of the summer analyst role participated in probably every single. Process that came to campus. I think I had a pretty good success rate in terms of at least getting like those prelim interviews and it's been so long ago at this point, I can't remember how many interviews I might have had, but yeah, it was basic.
Patrick (CEO of WSO): [00:11:51] Mean, you did like 20. My guess is you did like 20 resumé drops and maybe you had like between 10 and 15 first round interviews, something like that.
PIKtoggle: [00:11:58] Yeah, something like that. And I remember like some cover letter writing in there as well. Ok. Yeah. Which is awful because it's just like copy paste and change.
Patrick (CEO of WSO): [00:12:07] A few names. Hope you don't forget to change the company. exactly, exactly. Or spell like lizard or something like that.
PIKtoggle: [00:12:14] Yeah.
Patrick (CEO of WSO): [00:12:16] So you so you end up getting a bunch of interviews. You kind of have the right profile. You shown enough, you'd met enough people or shown enough interest. Were you doing like networking like any active or aggressive networking from your sophomore or junior year where you just more like, Hey, I've shown enough, this is enough to get me a seat because they're actively coming on campus in my GPA.
PIKtoggle: [00:12:35] So, yeah, it was more the latter, and I can't. Today's world. I'm not sure I would have survived like I probably would have had to have been more aggressive, but I was mostly sticking to the on campus, recruiting events and maintaining, you know, some level of interaction with one or two folks that I had connected with at those things. I also wanted to be mindful, like I didn't want to just be badgering these folks during their day jobs.
Patrick (CEO of WSO): [00:13:01] So like, would you send them a follow up email after like the info session thanking them stuff like that? Or was it like something where you'd keep them updated like a couple of times a year?
PIKtoggle: [00:13:08] Yeah, I definitely send follow up emails. If I had actually had a one one interaction with them and got their business card might have just mentioned something. Is that
Patrick (CEO of WSO): [00:13:18] Awkward? Like when you came like as a sophomore or junior, did you feel awkward, like going up and trying to force a conversation? Or were you just naturally good at that?
PIKtoggle: [00:13:28] Totally awkward. And I was terrible at it.
Patrick (CEO of WSO): [00:13:30] Yeah, because I feel like a lot of times there's info sessions are like traps. They're like everyone's rushing to try and talk to like the three bankers there. And kind of, yeah,
PIKtoggle: [00:13:40] It's a it's a meeting. It's a feeding frenzy. And so a lot of undergrads that I've talked to, both from school and just elsewhere and some interns that we hire during the summer, I just say, listen, like don't stress about it feeling forced and don't stress if for some reason you can't have that conversation. There's a little bit of this where you do have to be aggressive and hungry, but at the same time, it's going to naturally happen and it's a grind.
Patrick (CEO of WSO): [00:14:11] But like you said, it's a feeding frenzy. So like at the end of the thing, they're sitting there for questions and people like, do they start lining up or like how it just seems? I'm trying to remember back like it was so long ago for me, what? what it was like. I mean, I didn't even know what I was doing. I don't even, yeah, maybe had one on one with like an associate, and it wasn't even a it was like one with three people standing around them.
PIKtoggle: [00:14:33] No, it was. It was very much what you just described where you know, it was the session would end. There would be a little bit of Q&A with a mic passed around the room and then the first 15 minutes, you know, all the students would stand up. twenty percent would leave. Eighty percent would rush around like the three or four bankers that had come. I found if you waited it out long enough and so long as it's not like it was an hour after the thing ended and the bankers were like really looking to get back home and get back to their pitch decks and stuff like that. If you waited it out, you, you would. The group would slowly whittle down to a point where you could at least have a real conversation with someone and just say, Hey, so and so like, really enjoyed it, you know, x y z that you said actually related to this, that I'm learning in class or I found it really interesting. Now might not be the right time, but if we can find a way to stay in touch ahead of recruiting, I'd love to do that. And if you got a card out of that, that was like the perfect end.
Patrick (CEO of WSO): [00:15:33] Yeah, and you kind of leave it at that. You don't necessarily if they seem like engaged and you can continue it, but if they seem like they need to get out of there, then you let it be.
PIKtoggle: [00:15:40] Yeah, like a good example of what not to do is it was my interview with Citi, which didn't give me an offer which, like the night I heard from, you know, people that I was talking to, mostly upperclassmen about, you know, when your interviews are over and they say, Do you have any questions for us? Like, come with a couple of good questions. And so I just done some generic Googling on Citigroup the night before and found this one really esoteric deal that they had done in like Indonesia. And I was talking to like the fintech bankers and I asked this question, the guy was like, Yeah, man, I'm. I mean, we probably did that. I don't know what you're talking about. And like, that was the end of my interview. So if the goal of sounding really smart and intelligent, I it completely backfired because this guy was like, it's clear that this kid doesn't even know what he's interviewing for. And so I would just be, you know, I say that under the in the vein of, you know, don't force it and be yourself and kind of let those. hungry and assertive and aggressive where you can be, but don't. Don't over force the organic moments,
Patrick (CEO of WSO): [00:16:46] And I think I think that's it's a good warning not to try to sound overly smart or demonstrate your knowledge with like an esoteric deal or an esoteric fact or something. Whereas maybe some of the safer questions. I don't know if you have specific advice, but maybe something more along the deal teams how their how their staff stuff like stuff that maybe shows how you understand what the role is.
PIKtoggle: [00:17:07] Yeah, I think, yeah, asking a question about the role or the types of deals that they've been working on recently. You know, in order to get an understanding for how you as a summer analyst or a full time analyst might be fitting into the context of that overall deal is a good way to go.
Patrick (CEO of WSO): [00:17:30] Yeah, I think even having a little bit of knowledge about how the bank is structured like M&A Product Group versus coverage group versus M&A, you know what I mean? I think it is kind of digging into that a little bit may show that you've done your homework without it and allow them to answer it because they probably they obviously know that.
PIKtoggle: [00:17:45] One hundred percent. Ok, sure. Yeah. Yeah.
Patrick (CEO of WSO): [00:17:49] So you kind of you bombed City Fair. Did you bomb a bunch of others or did you have a bunch of offers for summer analysts spot by the time recruiting wrapped up?
PIKtoggle: [00:18:01] For me, it was a trial by trial, by error and trial by fire. I bombed a bunch of them and I probably had to at the end of the day, out of the like eight full conversations I think I had.
Patrick (CEO of WSO): [00:18:14] That's great, though. So then you ended up at a very well known bank. Great bank. Yeah, yeah. So were you like ecstatic or what was the thought? Was it like, super exciting because you knew that some or analysts offer usually leads to a full time? Or was it kind of you? Didn't you still kind of were trying to figure out what this whole investment banking thing was?
PIKtoggle: [00:18:33] Yeah, I think I was still trying to find my feet, and I knew that the goal was to ultimately leave the summer with an offer honestly more out of fear than because it was like, If you don't get the offer, you've royally screwed this up. And if your summer bank doesn't give you an offer, no one's going to touch you with a ten foot pole in full time recruiting process. So that was actually a little bit more fear driven of like, Hey, you got to you got to leave this summer with an offer, then you can make your choice.
Patrick (CEO of WSO): [00:19:02] And did you did you? So going into the summer with that fear, did you end up working like super long hours? What was what was the offer rate like at the end of that summer for the group? Because I know you
PIKtoggle: [00:19:13] Felt like probably close to 80 to eighty five percent. and I can't tell whether that's high or low, but this was the summer of seven. And so things were still mostly good with the world.
Patrick (CEO of WSO): [00:19:24] Very good. That's that tends to be pretty average. It's usually between 70 and 90 percent is what I've seen, at least in the database from the company database that we have. Ok. But yeah, so. Things are still rosy in 2007. All right. I hadn't completely there were some cracks maybe showing, but not enough to scare to scare the banks off. So what about the hours?
PIKtoggle: [00:19:46] Hours were long and that was as expected for me, but you don't know what an 80, 90, 100 hour workweek is like until you actually start doing it. And a lot of it was a lot of my buddies, you know, I lived in New York. And what is the
Patrick (CEO of WSO): [00:19:59] Hardest part about that, though, like the 80 90 hour? Because I know exactly you're talking about, I lived it, but tell me what was the most surprising thing about it?
PIKtoggle: [00:20:08] The surprising thing for me was the amount of work that didn't happen between nine and five and the amount of work that actually had to happen between five and, you know, whenever you went home, whether it was midnight two or sometimes three or four in the morning, just the natural. It was like this natural cadence that developed of a lot of the higher level strategic thinking with the MD and the director's time during the day that that happened and you were certainly part of those meetings, whether you were a summer or a full time. But then when it came down to the rubber meeting the road and actually doing the physical work like that really started towards the later portion of the day. And so it felt like that took some getting used to just the days being quite long. Some inefficiency in the middle of it, like, you know, sometimes you show up at nine or 10 in the morning, you're not really doing anything until early to mid-afternoon. You're like, I'd rather just be sleeping at this point. but yeah, you show up and you've got to be you've got to be a part of the mix there, and it's important to be around for all of that stuff. So that was surprising. And then I think, you know, just friends that weren't doing banking, but also in New York for the summer, they're like, What do you mean you're working 80 hours a week? Like, why can't you come out on a Thursday night and you're like, No, I actually can't. I'm here and I got to do my work.
Patrick (CEO of WSO): [00:21:28] So did you feel like was there any sort of reservation? So you got the full time, you obviously got the full time offer because you started there. But was there any reservation about accepting the full time offer was there or was just like the peer pressure? Yeah. Had mounted so much and you're like, Wow, you get paid a lot of money. And I know bonuses in 07 were probably huge, right?
PIKtoggle: [00:21:49] Yeah. So yeah, 07 07 was great. 08 was not as good.
Patrick (CEO of WSO): [00:21:54] Yeah, obviously, right? But was it was the pressure just too great? Like taking like just psychologically what was your thought process when you got that offer? You obviously worked really hard over the summer, you got the offer. It's a relief. But then was there any thought process? Maybe not. Maybe this isn't for me or was it? Hey, I'm going to learn a lot. Let's just do it.
PIKtoggle: [00:22:15] It was I'm going to learn a lot. Let's do it, I really wanted to find the best place that I could be that was going to challenge me, certainly mentally, but in a weird way, and you might understand this as well. Having done it like physically, like, there is an actual physical element to all this, which is the constant grind and the stress for two years. And I know to a comment you made earlier, I know that I'm going to do this for at least two years. Maybe this is it for me and I want to do this forever. My worst case scenario is that I've gone through the gauntlet and I'm going to come out really being able to do whatever I want after this hedge fund B school operating company, if I want like it, just felt like this was not going to close any doors for me and I was going to be such a great learning experience that that's ultimately the big reason why I chose it.
Patrick (CEO of WSO): [00:23:08] And yeah, and it is I mean, I came out, I came from, I mean, you had finance and accounting. I had none of that. You can imagine what my learning curve looked like in the first. Yeah, yeah. But it was it was insane and the hours were insane. And I remember like the first few months on the job, I remember there being like a Friday night and I hadn't gone home in like eight days or something like that or so, and it was like six o'clock and I thought I was going to get home. Yeah, there wasn't much on the plate. Like, we cleared out a bunch of stuff and then like, I hadn't had anything to eat that day and he was like, he was like, You know, we got to get this. All of a sudden, there's a fire drill again on something else. And I remember just like sitting there and I remember thinking to myself, like, I almost felt myself. I must get like emotional and like for somebody who's like you, pride yourself on like I can do the one hundred a week and done it and I was like, What's going on? I'm like, I felt myself like almost cracking, not cracking, like, Oh, I can't, I'm going to, like, go to the hospital or anything but cracking in the sense of like, Oh my gosh, like, like, what the fuck like this is crazy. Like, I'm not going to eat, I'm not going to sleep again. You know, that type of like panic almost set in. And it almost became like a psychological. Thing where is like, OK, I just have to like you have to have no expectations. And like the sooner you I felt free, at least for me, the sooner I let go of any expectation of leaving was, the easier it was to deal with it.
PIKtoggle: [00:24:32] Yeah. You know, I can commiserate with that one hundred percent and it sounds really messed up. But like in a perverse way. Yeah. Towards the the back third of my career as an analyst, I almost started looking forward to the Monday to Sunday work weeks because you never had a weekend. You never had. You never had a case of the Mondays. There was no high to come. You never. There was no high to come down off of after like an epic Saturday Sunday, right? You just cranked. And that I took a step back at some point I was like, That's probably not great. Probably a sign that I should go find something else. but I advocate for the investment banking experience. For anyone who's remotely interested in it,I say, try to do it for a small period of time, if you can, and if you can handle it for two to three years, it is such a great experience.
Patrick (CEO of WSO): [00:25:27] Yeah, for sure. So I think what about? So you were similar to me. I was trying to get up to Boston. You were trying to get up to Boston, except you probably had you had a lot more challenge. And since your timing was pretty bad. Yeah. So you were trying to get up to Boston as well from New York, you that second year things started falling apart. You lost. It sounds like they fired a few analysts out of how big was the class, like 50 100.
PIKtoggle: [00:25:53] It's probably like 80 or 90, I think
Patrick (CEO of WSO): [00:25:55] 80 or 90. So it was pretty big. So firing a couple of people, not that big of a deal, right?
PIKtoggle: [00:25:59] Not that big of a deal, but we had also heard like analysts never get fired. And so to actually see it happen into guys that were not terrible, I mean, some of them were duds. But yeah, guys that were actually could do the job and still got let go. That was actually pretty surprising.
Patrick (CEO of WSO): [00:26:16] Yeah, because they're cheap labor.
PIKtoggle: [00:26:18] Yeah, exactly. Exactly.
Patrick (CEO of WSO): [00:26:20] Ok, so there are some firings at the analyst level, which is kind of unheard of. You knew things were bad, but you were still talking to the typically we spoke about this earlier. You were talking to the typical recruiters trying to figure out what's out there in Boston. And yeah. You know, I had I spoke with somebody yesterday. They said that the buy side recruiting was still it was a little slower, but it wasn't like it dropped off, right? There was still some activity there. Or did you feel like there were just there was a lot less opportunity out there?
PIKtoggle: [00:26:49] Mine was probably more Boston specific just because it was a pretty small community it did feel. I don't think in general, the by side recruiting dropped off, but in Boston it felt particularly low.
Patrick (CEO of WSO): [00:27:01] Any thought to why that was?
PIKtoggle: [00:27:04] No, not really. I personally knew that I didn't want to go to a really big shop or a relatively bigger shop like an Ortex or something like that. I wanted to find a smaller middle market to lower middle market funds.
Patrick (CEO of WSO): [00:27:20] Why? Why was that? What gave you that thought of this is this is going to be a better fit because you were at a large bank
PIKtoggle: [00:27:25] So yeah, I think it was more personal preference to be like a smaller to medium sized fish in a smaller pond versus a very, very tiny fish In a much larger Institution.
Patrick (CEO of WSO): [00:27:37] Was that from your experience from the bank?
PIKtoggle: [00:27:40] No less from my ,less from the bank and more. I think just how I'm personally wired like I really wanted to find a I hate to call it like a family, but like, you know, a smaller group of guys and gals that I could really get to know on both the professional and personal level and really understand the buy side in terms of that type of atmosphere versus just being plopped in and being one of another 10 to 15 person class, I was hired with one other associate at the time. And so I really like that dynamic.
Patrick (CEO of WSO): [00:28:15] And so when you were the reason I pushed on that is because you ended up at a really large bank. I guess you had two offers. I don't know what the other bank was, but if it wasn't middleman, I was like, Why didn't you go middle market, you know? Yeah. To begin with. So I guess you see, you're looking for this, you're telling the recruiters all this. Do you feel like they do you feel like you were ready for those recruiter meetings, those initial ones? Or do you feel like maybe you drop the ball and they were like screening you out of a lot of stuff for some reason? Like, were you ranked highly at your bank?
PIKtoggle: [00:28:43] I was ranked very highly at the bank. I think I hadn't done the legwork enough, and I can't tell whether this is just because I didn't close enough deals or work on enough live deals while it oh, that can screw you. Yeah, that can screw you, bank. Yeah, it's just I didn't really understand the buy side. I knew it was like a flip side of the trade, and all of a sudden you're the one doing the investing and deploying the capital, and the diligence is going to look a little bit different. And certainly the process is different. But like, I didn't really know what I was getting myself into, so I couldn't elucidate a lot of what I was truly looking for outside of geography. And I don't want to be at a really, really super big shop.
Patrick (CEO of WSO): [00:29:17] So do you feel like some of those? Interviews like the standard why private equity, like your answer, wasn't quite as polished as maybe some of their analysts who had been like practicing this one since they were eight years
PIKtoggle: [00:29:27] Old, ready to get 100 percent?
Patrick (CEO of WSO): [00:29:30] Ok, that's fair. Yeah, I was the same way, but we were both so late in the process. It's like most of the shops are the most of the megaphones had already hired a year prior, right? Yeah, yeah. So so you're interviewing for a lot of these smaller shops, middle market shops? What are you looking for when you're interviewing or like, are you just taking whatever the recruiters throw at you for practice? Tell me about that whole process.
PIKtoggle: [00:29:52] Yeah, I was definitely taking anything. I could a lot for practice and I would say, don't do this too much. But if I had to do it all over again, even though I was only looking at Boston, I probably would have taken stuff outside of boston, mostly for the practice, because interviewing is such an art in, in and of itself. And you definitely do need just the rote practice of telling someone you've never met about yourself and about your experience and walking through deals. And to your point, why are you interested in private equity? Why are you interested in this strategy versus another strategy, middle market versus large cap buyout and stuff like that It's like that stuff just takes practice and you can practice with friends and family all you want. It's a whole different ballgame when you didn't get in the interview setting. so I don't advocate just taking interviews to take interviews and bouncing someone out of the seat, but like interviewing a lot infrequently to understand your own pitch is super important, and that's something I would have done more. I really restricted myself to one geography, so I really I had I would pretty limited interview experience like a
Patrick (CEO of WSO): [00:30:59] Handful or so.
PIKtoggle: [00:31:00] Yeah, probably five or six.
Patrick (CEO of WSO): [00:31:03] Do you feel like in your prep for those like, weren't there, weren't there analysts at your bank that had like recruiting material or help? Or do you feel like were they all gone and like, just checked out?
PIKtoggle: [00:31:15] Yeah, there might have been, but I didn't utilize them a lot. I had utilized some third years and then first year associates to help with the modeling, exercise and building model models from scratch. But as an as a first and second year analyst, like, you can do that in your sleep. you don't really need practice all that much from a blank excel.
Patrick (CEO of WSO): [00:31:36] Yeah, you needed the interview course. Yeah, yeah. 100 percent a little plug in there. Yeah. So in terms of it's just interesting to me. So you're kind of late. You're kind of you seemed like you were just grinding and just kind of putting your head down. You finally were like, OK, maybe I got to get my act together and start talking to these recruiters. Did they reach out to you had they been on your radar? And then I want to dig a little bit more into those conversations because I feel like they're really important, those initial conversations with the impression they have of you. Do you have specific advice on how narrow you said, Oh, I wish I'd interviewed more than Boston, but saying Boston is actually, in a sense, kind of good because it shows them like this kid's like knows what he wants. Do you agree with that? Or do you feel like you could maybe widen it a little bit? But like New York or Boston,
PIKtoggle: [00:32:25] I think I could have done New York or Boston and then sort of like played up the Boston angle a bit and just said, like, Hey, this is I'm really interested. I'm not. It's not just Boston for Boston sake, because you do find groups that are recruiting for very specific geographies. And I think that's a large part of the recruiters role is to be that intermediary between what the P strategy wants and what, what else, what's out there in the market effectively like an investment banker.
Patrick (CEO of WSO): [00:32:55] Yeah, it's like a game on how much to tell them, though, in terms of how narrow to get. Like, do I tell them hedge fund and private equity? Like for some kids, they're like, Hey, I don't know what I want. I do long, short, I'll do long, short hedge fund, I'll do private equity, I'll do distressed, I'll do anything you want to get to the buy side. But going in with that mind set can almost backfire, right?
PIKtoggle: [00:33:13] Yeah, you can't. I don't think you can be so wide and say, I'll do anything because then you're just not going to be there. You know, they're going to be a little bit reticent to put you in front of someone because of my nature of that. Yeah, I think whatever you whatever you tell the recruiters, whether you reach out on your own or you're responding to the litany of inbounds that you're naturally going to get in your inbox, you I think it's perfectly fine as a twenty to twenty three year old to be like, Listen, I don't know exactly what I want. this is what I really like and this is why I like it. And then that I think is going to help inform them where you're going to be relevant in a process and also shows that you're like a real, authentic person at the end of the day and you're actually thinking about this.
Patrick (CEO of WSO): [00:34:05] Yeah, like a little more genuine not have like such a rote answer. You come across as more authentic. You don't go super broad, but don't also try to like fake that. You know this exact if you don't know that you have this exact type of. Mike is just going to narrow your opportunities.
PIKtoggle: [00:34:20] Exactly. And it honestly is a numbers game, and I think what I was just starting out, I sort of was like, I have to. I had it in my mind that I had to find my not my forever home, but the place that I was going to be at for the next 20 years of my career. And it's like, No, I mean, as a as a mid-20s guy or girl, you should want to find the next right chapter and stage in your career, but be open that that can come from a bunch of different angles. And there's not just one place out there for you at the end of the day.
Patrick (CEO of WSO): [00:34:54] So you interview with a handful of places, you get a couple of offers, you flame out on the first floor and get the fifth or sixth. What was it like?
PIKtoggle: [00:35:02] I had three flameouts and two and two offers.
Patrick (CEO of WSO): [00:35:08] And did the offers come like back to back? Because once one you had an offer, the other one jumped through? How did it work?
PIKtoggle:: [00:35:13] It was. It was pretty close. I actually I won't bore you with the details. I actually. And maybe this is for another podcast around how not to accept an offer. This was this was one that I had turfed up on my own and was not using a recruiter for, so I was talking directly to the private equity firm. And I had some inside intel on what the comp package was for someone coming out of banking, and they had low balled me. And so I was like, I took it upon myself to try to get myself up to what I considered where everyone else was landing. And they actually pulled the offer from me. So I had, I guess, I had to and round wound up with one eventually. So you
Patrick (CEO of WSO): [00:35:57] Got a hey, at least you didn't have one and ended up at zero,
PIKtoggle: [00:36:00] Right? Yeah, exactly. I did have the backup at the time. I didn't have the other offer. It was sort of like on the come. Yeah, so that was a
Patrick (CEO of WSO): [00:36:08] That was me. That's actually really interesting. So tell me about how you approach that. Was it like a had you establish some rapport, you'd obviously gone in for a round or two to get the offer right?
PIKtoggle: [00:36:17] Yeah, I had yeah,
Patrick (CEO of WSO): [00:36:19] Was there like a modeling test and then they give you the offer except low balling. You now lowballing you in the sense of what overall PE associates make or lowball you based on like knowledge you had at the firm what they paid.
PIKtoggle: [00:36:32] Up more the ladder lowballing, yep, yep, you had a legitimate gripe. I did, yeah, and I thought I had approached it very well, and maybe I just, I don't know, said some something that set the guy that I was talking to off. But yeah, it was it was not the outcome that I was aiming for.
Patrick (CEO of WSO): [00:36:51] Got it. Ok, so you gambled and lost. Yep. Yep, yep. And you but you had you quickly had another offer in the book. I think I feel like once you get that first offer, did you tell the recruiters about that?
PIKtoggle: [00:37:06] I told a limited set because I also was I was cognizant that it was a pretty small and continues to be a very small world, and so I didn't necessarily want to tell my my sob story far and wide about how
Patrick (CEO of WSO): [00:37:20] Did you tell them you had an offer?
PIKtoggle: [00:37:22] I did, yep,
Patrick (CEO of WSO): [00:37:24] Because that could that changes the whole game in their eyes. I feel like
PIKtoggle: [00:37:27] It does, and you can't you can't sort of fake that you have another offer you like you have to have a legitimate offer and negotiating one.
Patrick (CEO of WSO): [00:37:36] When the funny part is, you say, like, I have an offer, they like, go frantic to try and get you lined up for other interviews and then you lose that offer. But you don't. Did you tell them like, Oh, actually, just kidding, I lost that offer? Like, what was it stressful? Because did they like, follow up? What was that?
PIKtoggle: [00:37:52] I'm trying to remember. I think it was. The I think the questions were less around.
Patrick (CEO of WSO): [00:37:59] Do you still have it?
PIKtoggle: [00:38:01] Yeah, it was. Yeah. Who in their right mind asked if you still have an offer? yeah, it was.it was less that and it was more, you know, tell me about the timing of this other process. And so I could genuinely say at the time, you this is this is what everything looks like. And so that's how everything else got accelerated. But now, I mean, it's it's, you know, everyone has FOMO. And I think pride when we do our own recruiting private equity is notoriously, I think, bad at this is like when you hear of a candidate that has an offer elsewhere, it's like, Oh, someone else thinks they're amazing. Like, we got to get on this too. And so the offers breed other offers, which is nice. but I would say is the candidate you also have to be mindful of. You don't want to just be chosen because someone thinks that someone else likes you at the end of the day, too.
Patrick (CEO of WSO): [00:38:53] Yeah, even the offers free to other offers. The offer breeds other interviews quickly accelerated through the recruiters.
PIKtoggle: [00:38:59] And from the recruiters standpoint, you know, you hate to look at it, but like they're trying to get paid too. And so they want to be putting high potential candidates in front of folks. And so if nothing else that offer, regardless of whether it leads to other offers, is going to be good to show that you're an employable quantity.
Patrick (CEO of WSO): [00:39:18] So regardless, if it gets pulled,
PIKtoggle: [00:39:20] Yeah, if you
Patrick (CEO of WSO): [00:39:22] Get too aggressive. So, OK, so. That's just it's just funny, because that's like the nightmare scenario. And you lived it, so was this like an email communication? I want to dive into that a little bit more where you like, Hey, I just noticed or I heard through a friend that this typically the pay or how did you approach that?
PIKtoggle: [00:39:41] And it was all over the phone and it was I had spoken with like the principal level and she said, OK, you know, listen, like, I get it. And I didn't reference. I had some friends at this group, so I didn't reference any specific conversations. I just said, you know, based on conversations that I've been having with recruiters and my knowledge of other others that have joined you at my level. historically, this is what I understand the compensation to look like. And I, you know, I'd really like to be there based on the experience that I'm bringing with me. and so I think I had had one and a half of those conversations with a principal. The first go around the feedback was no, the offers, the offer, and I basically asked her to go back to the, well, one more, one more time and sort of walked her through. why? Why?
Patrick (CEO of WSO): [00:40:32] Oh, so you pushed again the second time after they said,
PIKtoggle: [00:40:34] Yeah, and that was probably my fatal mistake after that. That's when I got the call from the MD who just shredded me.
Patrick (CEO of WSO): [00:40:42] So the guy actually called you and like, was pissed.
PIKtoggle: [00:40:46] Yeah, he was he was pretty pissed and it was after one of those mornings where he'd stayed up until, like 5:00 in the morning, the car books to my own MD and met him at the airport. And so I remember I got home. I got like two hours of sleep, and then I had this call, which I thought was going to be the call where it was like, OK, you know what? We've revisited, we're going to meet you at this level, and all was going to be well and it was the exact inverse of that.
Patrick (CEO of WSO): [00:41:09] And he was just like, who do you think you are like that type of thing? Yeah, it was a lot of that.
PIKtoggle: [00:41:14] And then I don't know if he entered the call thinking about pulling off or but by the end, I think he got himself to a spot where that was the natural conclusion of. Do you feel
Patrick (CEO of WSO): [00:41:23] Like you could have saved it in that call?
PIKtoggle: [00:41:25] No way. No way. It was predetermined. Yeah, it was. It was a death spiral.
Patrick (CEO of WSO): [00:41:32] You should have like, Oh, were you like very. Were you trying to backpedal
PIKtoggle: [00:41:38] Like I did, and I tried to be super humble? I tried to walk him through from my standpoint why I was asking for what I was asking for stress that compensation is not the most important quality in a job for me that fit culturally professionally. No one and I felt like this opportunity really had that. The learning experience was really great.
Patrick (CEO of WSO): [00:42:06] He was just so riled up. You probably had a bad day.
PIKtoggle: [00:42:09] Yeah, yeah. I do think it was a little bit of that. I certainly in the moment I replayed that situation over and over, but I've sort of since done that as well, and I think I could see it landing in a different spot. but you know, things also happen for a reason. And even though I came out of that pretty depressed for a period of like 48 hours like the world goes on and life just goes on and you're going to find your spot, you just kind of kind of have to trust it when you have those massive bumps in the road.
Patrick (CEO of WSO): [00:42:38] So the good news is you were able to tell the recruiters hang onto their offer. And so magically, 48 hours later, you had another offer.
PIKtoggle: [00:42:46] Yeah, it wasn't. It wasn't 48 hours. It was a bit longer than that. But it was it was like, Bam, bam. at least remembering back today, it could have been different historically, but that was
Patrick (CEO of WSO): [00:42:57] The comp higher or lower than that initial offer you got.
PIKtoggle: [00:43:01] It was a little higher. So I felt, yeah, I felt good about that. Ok, so it also a little bit justified in terms of like at least having gone back and asked for a little bit more.
Patrick (CEO of WSO): [00:43:10] Yeah. So you kind of. Do you mind sharing what that was? Is it like around one hundred base or 80 base?
PIKtoggle: [00:43:16] Yeah, it was a hundred. Base.
Patrick (CEO of WSO): [00:43:22] Ok. Yep. All right, and then bonus of around one hundred, I guess, for your first year or something like that.
PIKtoggle: [00:43:28] Yeah, it was a little bit different because the group I joined actually even at the associate level had a little bit of a Kerry component. But like if you think about everything all in it was it was
Patrick (CEO of WSO): [00:43:37] Close to that pretty similar small, small Kerry points. And then, OK, so this is this is not your traditional elbow fund, correct? And this is this is the same place you're at today.
PIKtoggle: [00:43:48] Yeah, same place I'm at today.
Patrick (CEO of WSO): [00:43:50] Yeah, OK. And so you obviously found a great home.
PIKtoggle: [00:43:53] Yeah, I did. I did. It's been. I definitely didn't join planning on. I certainly wanted to be. But like in terms of all my experience with people in my class and others that I got to know in the industry, it was usually too and out to business school. And then you kind of find your footing from there. And someone told me you'd be here for at least four to five years. I'd say absolutely nine years. I'd be like, Damn, that's a long time.
Patrick (CEO of WSO): [00:44:19] So any thoughts ever to go back to business school or where there was the opportunity to advance at your fund just so, so good that you thought, I'm going to stick it out and tell me a little bit about if whatever you can share about like the types of deals you guys do. I know you said there's a little bit more on the debt side of the credit side in terms of how you guys invest. I'd love to hear, is it like should I think of it as like mezze? You do subordinated debt. Like what? What are you guys doing?
PIKtoggle: [00:44:42] Yeah, I think mezze is a good way to characterize it. I like to describe it as credit opportunities and special situations, special situations. Everyone's got different definitions, and a lot of people immediately go to distressed loan to own deep turnaround. That's not who we are. We try to provide really flexible capital solutions that sit below senior debt. they might be unsecured debt, they might be really loose. Deep second lien preferred equity is another tool in our tool kit, and we do like to be equity aligned. We don't like to be just debt lenders in a business, but we're never going to be the control sponsor. And so we typically own anywhere from five to call it twenty five percent on the upper bound on a case by case basis, it might be a little bit higher than that, but that's sort of the usual band width and we'll get involved in other sponsor owned businesses. It might be an existing company that's gone through a bit of a bump in a road, and they need some friendly, flexible outside capital to refi, difficult balance sheet or inject some growth capital into a business.
Patrick (CEO of WSO): [00:45:48] Are you guys looking for? I mean, my guess is restructuring. My background would have been great for that because I saw some really messed up debt capital structures in my days at Rothschild in the restructuring group. Do you guys typically hire analysts out of restructuring shops like Houlihan and Rothschild?
PIKtoggle: [00:46:04] It hasn't been. It's been live thin, mostly that that have done really well with us. But restructuring a lot of a lot of guys and gals will interview with us, for sure.
Patrick (CEO of WSO): [00:46:14] Got it! Ok, so you're should I think of it? Like the types of skills you need to to succeed at your job would be almost understanding complex balance sheets, understanding where kind of the value lies in the capital structure, like in terms of what's the valuation of this company? What's safe? Where can we align ourselves behind the secured debt and still weather a storm and come out whole? Yeah, interesting. So I guess, how would how would somebody think about developing those skills? I guess banking, obviously, but any other way they could kind of improve that or learn about that
PIKtoggle: [00:46:50] Banking and then my word of advice. And this is regardless of whether you want to do something that aligns with and tilts our way from a strategy standpoint or traditional private equity or even hedge funds, for that matter, is model as much as you can. While you're an investment banker analyst, I know different groups are set up differently. I was fortunate in that while even though I was at an industry group, we still did a lot of our own M&A and LBO modeling. Other industry groups at my bank, while I was there, just passed all that stuff off to love Fin or M&A, and they were just running comps and putting together the, you know, the acquisition candidate overview slides in the back of the deck and stuff like that. And you know, you're just you just get a whole different level of analyst experience when you're in the guts of a model and you're modeling out different balance sheets and how they ebb and flow and pick
Patrick (CEO of WSO): [00:47:48] Pick toggles, there you go. So tell me about like how someone would know. So let's say there's a bulge bracket. They have a live fit and M&A group. How do they know what their specific industry group does, that the modeling and the actual modeling in how it's like word? Is the bank forthcoming about that? Did you do? Did you know about that going in?
PIKtoggle: [00:48:12] No, I think I lucked into the fact that my group did a lot of that. I had heard that it was something that. Is important, but that was almost simultaneous with hitting the desk, and so that's
Patrick (CEO of WSO): [00:48:25] On that group, right? You do lock into that group or were you did you rank it a certain way? Did you know you were going to hit that group?
PIKtoggle: [00:48:31] I ranked it and I tried to rank it pretty high. And I think if I had not joined that group and hadn't had that experience, I would just weigh on my associates, BP's directors, to just say, Hey, listen, I'd love to. I'd really love to get this experience. And from there, from their vantage point, if they don't have to place a call to a different floor to make their modelling changes like it's almost beneficial for them to, so you can probably couch it that way.
Patrick (CEO of WSO): [00:48:55] Ok, fair. So what's next for you? I guess what's the and actually? Can we talk a little bit about pay like banking you there for a couple of years? Your first year, I assume, was what? What was it back in there? 70 base or sixty five base, 70 base? Seventy five, maybe.
PIKtoggle: [00:49:13] Yeah. Yeah, I want to say 60 to 70, this is wow, this is a year ago, but it is 60 to seventy five base and then in oh, like the 08 full year, I think I was bonus, like 40 or 50.
Patrick (CEO of WSO): [00:49:29] The oh, wait, the down year,
PIKtoggle: [00:49:31] The down here, yeah,
Patrick (CEO of WSO): [00:49:32] Which is still not that bad and then the little bad when you consider how many hours you worked with. Yeah, yeah. How about the first year? Was it similar, but it almost like a flat bonus?
PIKtoggle: [00:49:41] The like the second full year that I was there.
Patrick (CEO of WSO): [00:49:44] Oh, I thought that was your that was your second year. So your your second year, what was your first year in your second year bonus, around
PIKtoggle: [00:49:53] Seventy five bonus going out on a.
Patrick (CEO of WSO): [00:49:57] Yeah. And that's when that's when the world was falling apart.
PIKtoggle: [00:49:59] Yes.
Patrick (CEO of WSO): [00:50:00] Yeah, yeah, it's pretty good. Yeah, we're definitely highly ranked.
PIKtoggle: [00:50:04] I was I just couldn't interview very well.
Patrick (CEO of WSO): [00:50:08] Ok, so then and then in terms of how you've kind of progressed at your current fund, I know when you came in it was around a hundred base and or no, that was yeah, you said about a hundred base. And, you know, all in maybe around two hundred with the care and all that stuff, we say call 50 bonus and a bunch of other little bells and whistles. What was the what's been the trajectory as you've because you've been there now for a long time. So it's kind of interesting. We haven't had a lot of guests who've been at one place. Obviously, you've there's been subsequent fund raising their funds since you've been there, I assume.
PIKtoggle: [00:50:40] Yeah, a couple of different funds have been raised.
Patrick (CEO of WSO): [00:50:42] Yeah, yeah. They seem to be getting more more carry with each one or how should I think about it or the listeners think about that in terms of from when you went from associate to senior associate to VP to principal, like what's what's typical, what maybe you can give us a range on what you got and then what do you what have you heard is typical for market?
PIKtoggle: [00:51:03] Yeah. So I can probably reference like what at least in recent memory, how the trajectory has been. I'm going to forget the in between. But you know that that two hundred of all in comp between current bonus and Carey starts to, you know, the numbers definitely start to get pretty big with the caveat that a lot of that starts to come in the form of Kerry. It's, you know, it's not guaranteed. It's way longer dated. Most funds, I think these days have American style waterfalls, so the capital is going to get deployed over a three to five year period. There's going to be a harvest period and then the carrier is going to start to hit. Other funds are also unique and there's varying degrees of this, but you've got capital commitments to these funds, which is different than Kerry. and so you as an investor actually have to invest in these funds.
Patrick (CEO of WSO): [00:51:56] So let me impact that a little bit. So you've been there for a long time. Are you seeing Kerry from the first little piece of care you got as an associate now? Or are you starting to see checks from that start?
PIKtoggle: [00:52:07] Yeah, starting to that, that happened a year or two ago. And as a as an associate, your carry allocation is so small like, that's nothing that I'm going to be buying a Porsche on or anything like that.
Patrick (CEO of WSO): [00:52:20] It's like a ten thousand dollar check here and there or something like that.
PIKtoggle: [00:52:22] Yeah, yeah. But you know, it starts to you understand the impact of that, certainly as you stay with the firm for a longer period of time. And as funds get raised, funds get stacked on top of each other. And so there's going to be at some point this intersection. And this is probably true elsewhere in other strategies where funds? I don't know, four, five and six are starting to pay out Carey at the same time. That might be five, six, seven years down the road, but like, that's when this starts to get really amplified.
Patrick (CEO of WSO): [00:52:56] Well, also because you're more senior in the slug of care you've been able to negotiate, I assume is much higher. Yes, exactly. And so do you have a range in terms of like what an associate like? Obviously, it's small, but it's really like, how should we think about that in terms of like a fund like yours, you mind sharing like a range of sizes in terms of the fund size that you guys started at and where you're at?
PIKtoggle: [00:53:16] Yeah. So I'll be I'll be loose in terms of, yeah, that's fine. But when I joined, we were a couple hundred million dollars call four hundred to five hundred million dollar fund where we're over a billion now in terms of the capital that we're deploying per fund and as an associate, it's tough because everyone thinks about it differently. A lot of funds talk about it and I still don't even understand it all that perfectly. But there's points in terms of the number of points of care you get out of the two thousand points that the entire GP gets, that's your little sliver of of the GP's figure. Other funds think about it in terms of just the Kerry dollars that you have at work. And so if you assume a normal two times return on a private equity style fund, about a turn of that is going to be profits management fees. You're going to have to get repaid and there's going to be some drag overall. But if you kind of use that as a bogey and take 20 percent of that and then your own little sliver of the 20 percent divide that over the number of years that you think that that Carey will be paid out, that's effectively the amount of dollar dollars at work that you have per year
Patrick (CEO of WSO): [00:54:36] That you could, and that makes sense. So but as an associate, so out of the twenty points, the. 20 percent carry upside, right, is what you're talking about in terms of that coming back as an associate, coming in, I know it's become more common. It's actually surprising that you got that back then because I think it was less common, but it actually has become more common. And was this something where like they were giving you like half a percent, half a point, a quarter of a point, a point somewhere between a quarter and one point? Or is it like quarter point and five points? And then has it gone to the point where the partners are willing for they obviously believe in you. You stuck around there where they've been willing in the latest funds to go between like five and 20 or like as high as that? Or is it? Am I in the ballpark at all?
PIKtoggle: [00:55:20] Yeah, I would say for associates and I'm not sure what we're doing these days. But yeah, it's it's probably. Five, 10, 15 points in turn, this is totally dependent upon the size of the fund and the number of others that are.
Patrick (CEO of WSO): [00:55:39] You mean you mean like Bips five 10. oh yeah, yeah, OK.
PIKtoggle: [00:55:43] Yeah, OK. and then, you know, it goes up upwards from there.
Patrick (CEO of WSO): [00:55:49] Ok, fair. Yeah, great. And then so what's next for you? Are you going to just ride all the way up on with this fund? Is that the plan? I mean, you've had a lot of success there, and obviously there's a lot of assuming you guys do well, there's a lot of carry out there, carry knowledge at work. Yeah. So it could become start to become really financially rewarding is said to ride that out and kind of become more of a leader there and eventually a partner.
PIKtoggle: [00:56:17] Yeah, I I I'm really enjoying what I'm doing in terms of our spot in the ecosystem. I think this flexible capital mandate where you're not like every other LBO or growth equity shop out there, which there are so many great strategies that do that, but they're restricted to just M&A processes where we can get involved in dividend recaps and complex balance sheet refinancings. And certainly the return the return potential for debt with warrants or preferred equity like the number of times we're doing over three times, our money on a deal is quite low. But we also don't have the epic flameouts or we try not to have the epic flameout that some other the other equity shops might. So you can sort of triangulate to a similar fund return band in a very similar way. I also see that a lot of limited partners like the strategy as well because there's a current return component to it, and so the J Curve is much lower. So in terms of a capital supply for these types of strategies, there's a lot out there. There's a lot of deal flow that's relevant for the strategy. So I think it's a really interesting place to play the private equity structured capital. Special credit opportunities ecosystem. And then personally, I mean, I've really enjoyed growing up and becoming a deal leader, but then even starting to think about what's next. I think that the lower, lower middle market is one of the last bastions of lower competition areas where you can actually still uncover some really unique nuggets of value down there, where it's not 20 names that are all battling for the same unsecured term loan, and they're going to just beat themselves down in price to win it at the end of the day. And so, you know, whether it's within the current shop, a new strategy or launching out of my own at some point to start something new, I definitely think and hope that that's in the cards at some point.
Patrick (CEO of WSO): [00:58:16] That's great. So before we call it well, it's been almost an hour before we call it anything you'd like to. Anything else you'd like to share with the young listeners or to your younger self any advice you would give? Looking back,
PIKtoggle: [00:58:26] Yeah, I would say I'll probably talk to my younger self because he doesn't know what he was doing at all, and I'm sure your listeners are going to be way more advanced than I was at that stage. You know, think about your next, think about your career as a marathon, and I'm not even sure that that's the right way to characterize it. But it's so easy. Certainly, when you're an investment banking analyst, you're just thinking about the next couple of hours or tomorrow. You're not thinking about five years, 10 years, 15 years. and I felt that that bread a lot of discomfort in terms of anxiety about going through the interview process. And there was this track, and if I was off the track, that meant something was wrong with me and I had those flameout interviews. I had an offer pull that I had some pretty dark moments, just kind of trust that things are going to happen. And this is a journey for everyone. And just because you don't fit the perfect mold of your classmates or even your school classmates that are looking for interview jobs like we found that some of our best hires have been the guys and gals that have not taken the traditional tracks. They're the grinders and they're going to do what it takes to get the work done. I think a lot of that adversary perceived adversity breeds a lot both an interesting story, but just really good workout. So just kind of trust that if it's something you want, put your head down, fight for it, it's going to happen. Might take a little more time than you'd like, but you're going to get there at the end of the day.
Patrick (CEO of WSO): [01:00:03] Great words to live by. Thanks so much Pik toggle.
PIKtoggle: [01:00:06] Yeah, absolutely. It really enjoyed it, Pat.
Patrick (CEO of WSO): [01:00:08] And thanks to you, my listeners at Wall Street Oasis. If you have any suggestions whatsoever, please don't hesitate to send them my way. Patrick at Wall Street Oasis. And till next time.
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