Private Equity Careers: How Much Can You Make?

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A career in private equity is rife with money! Private equity professionals earn way more than any other finance professional, ranging from thousands to millions of dollars. They receive perks and other benefits on top of their salary. With the recent explosion in demand for private equity professionals, now there are a plethora of opportunities for PE professionals. 

What makes private equity appealing? 

High income, bonus, perks, and other monetary benefits make a private equity career appealing. The satisfaction of closing large deals, meeting high -net worth individuals, entrepreneurs and constantly chasing deadlines add to the charm of a private equity career. Usually private equity firms are staffed in small numbers, so every employee working at the firm has significantly more chances of making themselves shine at work.

Not to mention, the big paychecks at the end of the month, the news of acquiring a company, and/or selling off a company brings immense pleasure at the end of the month. Additionally, the private equity industry offers fast-paced work environment along with rapid career growth. If you hear a graduate making millions of dollars right after college, it’s most likely that the person is working in a PE fund.  

How much can private equity professionals make? 

One of the things private equity is most known for is the hefty paychecks. The salary of PE professionals is contingent to deals, especially in the higher rung of the hierarchy. So the harder you work, the more you can make. The compensation for entry-level associates depends on the firms. Global firms tend to pay more, while boutique and regional firms pay relatively less. 

The compensation of private equity professionals varies across regions. Compared to Europe and the Asia Pacific region, the U.S region pays the most salary to professionals, making the U.S most desirable place for bankers to work, according to Preqin. 

Salary of PE professionals in the U.S. ( in dollars)

 

Role Base salary  Total annual compensation Carried interest  Total remuneration 
Analyst 86k 114k 121k
Associate  107k 152k 45k 160k
Senior Associate  127k 184k 65k 215k
Director/ Principal 272k 428k 545k 850k
MD/Partner 420k 668k 1195k 1623k


Source : Preqin, 2019

 

Salary of PE professionals in Europe ( in US dollars)

 

Role Base salary Total annual compensation Carried interest Total remuneration
Analyst  81k 117k 119k
Associate  82k 124k 142k
Senior Associate  98k 132k 62k 174k
Director/Principal 201k 386k 313k 594k
MD/Partner 340k 736k 1844k 2396k


Source: Preqin, 2019

Salary of PE professionals in Asia ( APAC)

 

Role Base salary  Total annual compensation Carried interest  Total remuneration 
Analyst 57k 71k 73k
Associate  94k 120k 149k
Senior Associate  86k 109k 62k 124k
Director / Principal  184k 370k 276k 389k
MD/ Partner  333k 472k 660k 892k


Source: Preqin , 2019

Total remuneration for all levels in private equity is higher except MD across the U.S compared to other regions. According to Preqin, managing directors and partners in Europe earn nearly $2.4 million yearly compared to $1.6 million and $892k respectively in theUS and Asia Pacific region. The number of managing directors for considering salary is significantly small, making it prone to changes in salary. 

Private equity professionals in the U.S. make high income. On the other hand, their counterparts in Asia make way less. This is applicable to all levels of professionals. Directors and MD in the U.S. earn almost double of their Asian counterparts. One of the major reasons that can be attributed to this is the large number of staff at PE firms in Asian countries. 

The average number of employees dedicated to deal making in PE funds in APAC is 17. This number falls to eight in the U.S. and Europe. The relatively low income in Asia is due to large number of professionals working at PE firm.

 

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