The provided articles introduce private equity salaries, bonuses, carried interest levels, as well as the day-to-day work and required skillsets of investment bankers. As high paying finance jobs, both private equity and investment banking require long hours while providing opportunities to earn significant compensation. We will analyze the compensation structures, fund economics, and work lifestyles in both careers.
Private equity salary ranges for different levels
The article provides base salary and bonus ranges for private equity professionals at different seniority levels in North America as of 2020. For example, senior associates earn $250-350K base + $250-500K bonus; vice presidents earn $300-500K base + $500K-1M bonus; principals earn $400-750K base + $1-2.5M bonus. Compensation also includes carried interest and potential co-investments.
Carried interest mechanics and vesting
Carried interest allows private equity firms to earn a percentage (typically 20%) of investment profits, subject to hurdle rate. It vests over time, with shorter vesting for more senior professionals. If someone joins late or leaves early, their carried interest is prorated.
Investment banking work hours and lifestyles
The article describes long hours as typical in investment banking, with professionals working late into the night and on weekends during live deals. One joke is about the “nine five” schedule, clarified as 5am to 5pm rather than the typical interpretation of 9am-5pm. Work-life balance varies by group.
Required skills for investment banking success
Key skills include financial knowledge (accounting, valuation, modeling), attention to detail, communication abilities, and process management. Junior bankers focus more on models and pitchbooks while senior bankers interact with clients and structure deals.
In both private equity and investment banking, professionals work long hours under high pressure while earning significant cash compensation plus performance-based pay. Success requires financial skills, modeling abilities, communication talent, and process orientation.