The annual Private Equity Jobs Digest Compensation Reports are based on surveys designed to capture valuable compensation information directly from those directly involved in private equity and venture capital. Over the years, we have surveyed many partners, principals, vice presidents, associates and others from investment firms, both large and small.
The complete report is sold on www.PrivateEquityCompensation.com and a complimentary version of the report is available to our Premium Members for no additional cost.
Here we summarize the results of the current private equity compensation survey to include some of the earnings data and other findings. The report addresses issues such as the compensation earned by professionals and their work satisfaction. The report also reveal how these professionals perceive their work and what they expect from their employers.
Although 2015 will not go on record as a banner year for private equity and venture capital firms, they did turn in a solid performance which resulted in compensation gains and enhanced job opportunities for professionals in the field. Private equity and venture capital professionals saw a repeat of the modest gains posted in 2014 but that has not dampened optimism for the majority of our respondents, as fully 65 percent of survey respondents expect to see an increase in cash earnings this year.
Linking compensation with fund performance from the investor’s perspective has been an ongoing theme across the entire financial industry for several years now. We’ve seen this trend strengthen and this alignment between investor goals and compensation may make the industry more sustainable in the long run, providing a clearer picture in the value added by investment professionals.
Private equity and venture capital firms have maintained their strength in the alternative finance space. High net worth and institutional investors both continue to move money into the hands of these portfolio managers, despite the returns not always keeping up with stock market indexes. It is an alternative asset class that provided creates needed portfolio diversification.
One challenge the industry continues to see is the call for greater transparency and value for management fees. In the end, longer term performance will determine if a firm can continue to charge higher fees and, thus retain the best alternative investment talent. We’ve seen a trend of stronger correlations between fund performance and individual performance.
Check out the Private Equity Compensation Infographic