Would You Do It? (In-house) Forum

[Anonymous User]

In-house position at major market private equity/hedge fund/IB type firm. ~$130k base. Up to 40% bonus.

Is this below/at market? Worth it to leave for?

[Anonymous User]

Maybe yes, but first explain the 40% bonus. As in, how and how much.

IMHO: If it adds up to less than 200k, then fewer hours needs to be the selling point.

[PMan99]

Impossible to answer without more information. There's a big difference between a first year lit associate in Houston and a seventh year tech trans associate in Palo Alto.

[Anonymous User]

OP.

Bonus would be % of base. Likely wouldn’t be $200k+ overall to start, but hours would be less (not a significant drop however). 2nd year m&a, major market (ny, sf, etc. not tx)

[Toni V]

OP.

Bonus would be % of base. Likely wouldn’t be $200k+ overall to start, but hours would be less (not a significant drop however). 2nd year m&a, major market (ny, sf, etc. not tx)

Please explain bolded. TIA

[Anonymous User]

In-house position at major market private equity/hedge fund/IB type firm. ~$130k base. Up to 40% bonus.

Is this below/at market? Worth it to leave for?

I don't know why people are struggling with this. The bonus is up to 40% of his base salary, probably depending on certain performance metrics (both by the firm and personally). OP, this is a low offer and I wouldn't consider unless you are unhappy in biglaw and just want out now. I just went in-house recently (TX M&A associate) and did a lot of research before accepting. Not sure what year you are, but I was finishing my 3rd year (right before becoming 4th) and I got comp about $300k all in, this includes target bonus and RSUs that don't vest for many years. But I spoke to many people who made the jump (all in TX admittedly), and they were all in the comp range of 225-300k. I would hold out for higher comp, your initial package will limit pay raises early on (at least from what I have seen). See if you can get to $150k base, that gets you over $200 all in which is a good spot.

[Anonymous User]

In-house position at major market private equity/hedge fund/IB type firm. ~$130k base. Up to 40% bonus.

Is this below/at market? Worth it to leave for?

I don't know why people are struggling with this. The bonus is up to 40% of his base salary, probably depending on certain performance metrics (both by the firm and personally). OP, this is a low offer and I wouldn't consider unless you are unhappy in biglaw and just want out now. I just went in-house recently (TX M&A associate) and did a lot of research before accepting. Not sure what year you are, but I was finishing my 3rd year (right before becoming 4th) and I got comp about $300k all in, this includes target bonus and RSUs that don't vest for many years. But I spoke to many people who made the jump (all in TX admittedly), and they were all in the comp range of 225-300k. I would hold out for higher comp, your initial package will limit pay raises early on (at least from what I have seen). See if you can get to $150k base, that gets you over $200 all in which is a good spot.

OP.

Correct on the bonus. 2nd year currently. Sounds like it makes sense to push for a higher base given the limited early pay raise potential or wait and look for similar opportunities down the road?

Thanks for your input and background, it's much appreciated.

[azntwice]

This depends on a lot of factors, including what the growth potential at the fund would be, how well the fund is going, and how much you are likely to actually get paid on the bonus. However, $130k base I would personally consider very low, particularly given how high market is right now.

[Anonymous User]

The bonus confusion makes me question the quality of advice in this forum.

$130k base seems below median for a non-GC role in a major market for a fund (can't speak to an IB), but not without the range of base salaries in this space (I wouldn't describe it as very low, maybe 25th percentile range). I would be surprised if the hours weren't significant, as you allude to, even though they would be less than what you're doing now. Personally, I wouldn't think of jumping as a 2nd year.

[smokeylarue]

Question hinges on how certain is the bonus? All-in comp of $182k for a 2nd year is actually quite good in my opinion. I mean, you're only making 190k this year at the big law firm, so it's not a big step down. The 130k base is definitely low, but the 40% bonus is also abnormally high. If the 40% bonus is basically guaranteed every year, this is a fair offer. If the bonus is subject to extreme fluctuations, then I would be wary.

[shock259]

Biggest things for you to investigate/consider, in my opinion:

1) How much do you hate biglaw and how much better will your hours really be? I work mostly across from IB/PE lawyers, and many do not have any better of a lifestyle than outside counsel. The one position you don't want to end up in is working just as many hours for more questionable compensation and poorer exit options.

2) How confident are you that you will receive the bonus, and how much risk are you will to put up with? I would try to get a sense from folks at the company of how bonuses are paid. Even if it is a bit ambiguous as to process, you should be able to gather the historical data on how they have been paid in the past. Can you make ends meet if you don't get a bonus at all? Can you deal with the "lumpy" nature of big bonuses?

3) how do you actually feel about the company and about your potential new coworkers? Ideally you'll be settling into this role for a long time (it is much easier to jump from firm to firm than it is to jump from in-house position to in-house position). Are you excited about the prospect of working there? Can you see yourself staying for a long time?

[JohnnieSockran]

Question hinges on how certain is the bonus? All-in comp of $182k for a 2nd year is actually quite good in my opinion. I mean, you're only making 190k this year at the big law firm, so it's not a big step down. The 130k base is definitely low, but the 40% bonus is also abnormally high. If the 40% bonus is basically guaranteed every year, this is a fair offer. If the bonus is subject to extreme fluctuations, then I would be wary.

2nd years make $200k, and actually slightly more this year ($195k in salary this year + $7500 summer bonus + $25k EOY bonus), but the new going rate for 2nd years is $200k, with $25k bonus, so $225k.

Not arguing that this offer seems pretty fair (contingent on bonus), just noting that it's a bit more of a step down than mentioned (~$45k pay cut).

[smokeylarue]

Question hinges on how certain is the bonus? All-in comp of $182k for a 2nd year is actually quite good in my opinion. I mean, you're only making 190k this year at the big law firm, so it's not a big step down. The 130k base is definitely low, but the 40% bonus is also abnormally high. If the 40% bonus is basically guaranteed every year, this is a fair offer. If the bonus is subject to extreme fluctuations, then I would be wary.

2nd years make $200k, and actually slightly more this year ($195k in salary this year + $7500 summer bonus + $25k EOY bonus), but the new going rate for 2nd years is $200k, with $25k bonus, so $225k.

Not arguing that this offer seems pretty fair (contingent on bonus), just noting that it's a bit more of a step down than mentioned (~$45k pay cut).

Very fair point. Not everyone hits their hours though so lots of people don’t get a bonus every year. If OP is in that boat he may want to compare guaranteed comp vs guaranteed comp only.

[Anonymous User]

OP.

Appreciate all the responses and feedback, thanks everyone