Change my view- low interest coinvest as an associate seems like a way to go broke if a few deals go south.

like
Posting as :
works at
You are currently posting as works at

Yes there’s always risk when investing. But “deal going south” in PE is almost never going to 0 and very rarely sub 1x return.

like

Unless it’s a turnaround fund, then the distribution is much wider (but you still generally come out ahead)

No risk no reward - generally speaking it’s a better play than what you would pick in the public markets

like

Seriously at 25. Youre really going to question a decision to sky rocket.

like

If your understanding of concepts like appropriate weighing of risk/reward, liquidity management, and diversification leads you to a conclusion of “coinvest is a way to go broke”, then perhaps this isn’t the field for you.

like

You are approaching this with the mindset that because there is a chance that it can go to zero, it isn’t worth doing at all. That isn’t true; all investments have some degree of risk and you have to understand the risk/reward you believe in and then either invest or don’t based on what makes sense for you. If you truly think all of the investments of your fund are not worth the risk/reward, then you are at an underperforming fund and should leave.

This is also where a portfolio and diversification come in in two ways. The first is it balances the risk. While coinvest might be relatively risky, If you offset it appropriately with “safer” things like broad index funds, bonds etc then that risk is appropriate. Likewise if you go deep on coinvest, then it would be irresponsible to also take a big bet on other high risk assets (e.g., crypto).

The other component of diversification is in liquidity. Coinvest locks you up for years. So likewise how much coinvest you take should be influenced by the liquidity of your portfolio elsewhere, and again you should balance it accordingly.

Your appetite for each of those things - risk and illiquidity - should be informed by your personal situation. Primarily your age and short term financial needs.

So it’s all about to what degree it fits in your portfolio (or doesn’t).

likehelpful

Related Posts

McKinsey or Google?

likesmarthelpful

Hi All How is life science Accounts of persistent
Should I join Persistent or dessault ? and Why

Please help me with below. What can be the in hand salary?? I have nothing for tax saving.

Post Photo
like

Hi fishes, got an offer from Deloitte. Can someone please help me know what is the in-hand salary? Deloitte USI Deloitte

Post Photo
likeupliftinghelpful

Do you need to formally accept your position on Wharton waitlist or does it happen automatically?

like
like
like

Quick update LA County covid update

Cumulatively, out of the more than 4.8 million L.A. County residents who have been fully vaccinated, 6,520 — about .13% — have tested positive

287 people, roughly .006%, later had to be hospitalized for COVID-19; and 30 people, .0006%, eventually died

funny

Hi fishes, need help

I'm working as a business tech analyst at ZS since 1.5 years and I have worked extensively in SQL and in automation using Python. I know a good deal of ML and DL theory and have done two projects which I believe are good. I'm from CS background and am decent at coding. Anyone who can help me with a referral for data science/ML engineer roles? Current CTC is 13L.

like

Hello sharks,

I have almost 12 years of experience and have an offer of 26LPA from a product company, seems to be there is an opening in Qualcomm, how much should i say the expected CTC to Qualcomm while applying?

like

Need suggestion.
I am working as manual testing lead. Total Exp:8 years.
Now I want to switch from manual testing. Which option is recommended for long term.

Think of
1 selenium
2 devops

Any new suggest are most welcome
Thanks 🙏

like
like

Hello Everyone, I got an offer from Mindtree 24lac fixed(Azure Data Engineer)...is it okay to join Mindtree kolkata...how is the project availability and job security? also as LTI Mindtree has been merged will I get an offer from LTIMindtree?Mindtree @LTIMindtree

like

Hello Fishes, I have offers from Accenture and LTI with 6 years of experience.

Accenture - Level 9 - 20.3 Lpa (16 Fixed and 27% VP)
Larsen & Toubro Infotech
- P3 - 20.8 LPA (18 Fixed and 10% VP)

Which one is better to join? I work with Microsoft Power BI Kindly suggest, Thanks !!

like

Everyone seems to want to go to buy side but what exits do buy side people look for/aspire to or is it usually just climbing the ranks/switching to a better fund?

like

How often should I talk to my boss about hiring me full-time? I'm a temp-to-hire currently, and I have been told that sometime this month I should be hired, but have been told the same thing for the past two months. Should I bring it up again? Or just ride it out?

like

If I feel up and down throughout the day, would that be considered bipolar? I can be super depressed for hours and then feel good and then back to depression. 😢

like

How is Guidewire as technology????

Anyone exited from their venture? I am on the process of exiting. It is a bit overwhelming to figure out handling money, capital gains, tax impact, pay off what you can. How did you handle this? Any suggestions or wisdom you can share? It is not in 100 mil but a lot for a small guy who can be totally financially independent and even much more.

like

Extended weekend, anyone?

Post Photo
like

Additional Posts in Private Equity and the Buy Side

What is the career progression like in PE? At McKinsey where I am now, it’s fairly standardized, about 2-3 years at each level, and up/out model. If can’t get elected partner after 2 or 3 cycles, will likely get counseled out. Partner eligible for senior partnership after 6 years. How is it in PE? Is it up/out as well or can you end up being “stuck” at associate level for 10 years? How likely is it to be promoted, how fast and what happens if you are asked to leave (where do you go next?)

like

Opinions on Ardian (growth) in Europe? I’m finishing my master’s and have offers from Ardian and MBB. My long term goal is to work in PE (growth). How is Ardian seen on the market? Should I start directly in PE or MBB and then try to shift to a better fund?

like
like

Can we put a stop to these dudes on LinkedIn making u comment on their post for a freaking excel template

likefunny

Everyone seems to want to go to buy side but what exits do buy side people look for/aspire to or is it usually just climbing the ranks/switching to a better fund?

like

For a senior role (Principal, MD) when do firms typically do reference checks-Before or after extending an offer? In conversations with a PE firm and it’s going well. The founding partner said during the in-person meeting they really like me, have gotten positive feedback from every partner, and see a good cultural fit. Wonder if this means they’re close to extending an offer or is this typical to say and could still lead to no offer

like

Hey 🐟s. If anyone wants any advice on getting into growth equity give me a shout. Had lots of people help me break in so want to pay it back.

like

How do growth equity funds typically source deals?

like

Received a buyout offer but thinking of turning it down to recruit for more growth oriented roles as that’s where my real interests lie. Any thoughts on starting a career in buyout vs. directly in growth?

like

Why can’t I get a job that I actually want...

like

For those who switched from consulting to mid market PE, how do you like it?

like

What are the salary expectation for an analyst in infrastructure private equity with 3 years of experience ? (In london)

like

Anyone know anything about Wombat Capital? Got an associate offer from them so curious if they’re worth it.

like

Thoughts on being an operating partner on a 1099 vs an in house role? I have both options, just trying to weigh the pros/cons

likehelpful

What are the different tiers of PE exits?

like

HH reached out with a role that is perfect but in the wrong geo (across the US). Should I go for it and try to negotiate / leverage the interview process to prove that I can close and get an offer?

like

What’s life like in LMM PE? Do I get to have a life?

like

Base + bonus + carry at EU (London) VCs at each level of the chain? I’ve heard very different things

like

Engagement manager at a top life sciences boutique. How well does that profile resonate with PE/VC firms?

like

How’s greycroft comp for a $2b firm? Expecting 130k+70k ish for associate?

like

New to Fishbowl?

Download the Fishbowl app to
unlock all discussions on Fishbowl.
That was just a preview…
Sign Up to see all discussions
  • Discover what it’s like to work at companies from real professionals
  • Get candid advice from people in your field in a safe space
  • Chat and network with other professionals in your field
Sign up in seconds to unlock all discussions on Fishbowl.

Already a user?
Login here

Share

Embed this post

Copy and paste embed code on your site

Preview

Download the
Fishbowl app

See what’s happening in your industry
from the palm of your hand.

A phone with Fishbowl app

Send download link to your phone

OR

Scan your QR code to download
Fishbowl app on your mobile

By continuing you agree to Terms of Use and Privacy Policy.

Messaging rates may apply

Download app

Sign up for free to view this conversation on Fishbowl

By continuing you agree to Terms of Use and Privacy Policy

Already have an account? Log in

Sign up for free to continue using Fishbowl

By continuing you agree to Terms of Use(New) and Privacy Policy(New)
Messaging rates may apply

Already have an account? Log in

For account settings, visit Fishbowl on Desktop Browser or

General

Legal