Compensation Trends in Alternative Asset Management

Transcription

1 Compensation Trends in Alternative Asset Management Presented by: Jason Wachtel, Managing Partner JW Michaels & Co.

2 Data Collection The data appearing in the compensation report was collected by comparing invoiced placements made by JW Michaels & Co. in Candidates were placed with clients located throughout the United States The positions were not limited to JW Michaels office locations (in NYC, Chicago, and Parsippany, NJ) 2

3 Classification of Firms Small = less than $1 billion AUM Medium = $1 billion to $2 billion AUM Large = greater than $2 billion AUM 3

4 A Note on Compensation Ranges Within the data, compensation for some positions are represented by a range instead of a single number. Positions are represented with a compensation range in situations where JW Michaels placed a candidate in a position with the same title and same firm type within the calendar year

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6 Compliance Candidate Profile: CCO, Large PE Firm 6

7 Compliance Candidate Profile: Deputy CCO, Large Hedge Fund 7

8 Compliance Candidate Profile: CCO, Large Hedge Fund 8

9 Compliance Candidate Profile: Junior Compliance Associate 9

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11 Legal Candidate Profile: General Counsel, Small Hedge Fund 11

12 Legal Candidate Profile: General Counsel, Large Hedge Fund 12

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14 The Market for Risk Managers Risk is at the forefront of financial service organizations recruiting needs. It has become increasingly evident that having someone in-house to manage exposures across the capital structure and investment strategy is pertinent to successful navigation and positive returns. Risk manager with strong technical skills, product knowledge and control and the ability to communicate exposures into tangible ideas are a top commodity in today s market. In the next slides you will see two examples of strong risk managers we have placed at both an investment bank and a top fund. Below is a snapshot of compensation trends for folks in risk. Typically Risk is not seen as an investment contributor but that notion has changed as funds and asset manager look to tie in risk limits and parameters to their investment decisions. That being said, Risk compensation is now being tied in to overall performance at top organizations. Large Asset Manager Base: $125k - $250k Bonus: 0-50% of target or discretionary Large Fund Base: $125k - $300k Bonus: 0-150% of target or discretionary 14

15 Risk Candidate Profile: Investment Bank 15

16 Risk Candidate Profile: Large Hedge Fund 16

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18 Accounting & Finance Candidate Profile: CFO, Large Hedge Fund 18

19 Accounting & Finance Candidate Profile: Senior Accountant, Hedge Fund 19

20 Accounting & Finance Candidate Profile: Controller, Private Equity, Asset Management, or Hedge Fund 20

21 Hiring from Government Agencies Advantages of Hiring Direct from Government Agency: Institutional Knowledge: Most candidates will know how the agency s viewpoint and know who to call about a certain issue. This is particularly advantageous with new laws/regulations where it is unchartered territory. Compensation: Candidates are in a lower compensation bracket. Good Basics: Many candidates from government agencies have strong academic credentials. They also do not have bad habits of prior firms with an improper compliance program. They have seen a great deal of firms and the good, bad and ugly of various compliance programs. Good Faith: A firm can show good faith with the public and government by hiring someone from the government. It instills a sense of confidence in the strength of their compliance/legal department. 21

22 Hiring From Government Agencies Disadvantages of Hiring Direct from Government Agency: Use of Direct Knowledge May Be Limited: A candidate from a government agency (esp. with knowledge directly on point) may be conflicted out from either applying for the role or limited in who he can speak to at the government agency based on ethic rules. All concerns should be vetted in advance. Compensation: Candidates who have paid their dues in the government agency, often have unrealistic ideas about compensation. This is important to be handled up-front. Needs Training: Candidates from a government agency will need some training to get up to speed. Taking of the Government Hat: Candidates from the government may have trouble taking off the government hat and putting on the business hat to make business judgments while calculating the compliance/legal risk. 22

23 Current Trends in Hiring Most common backgrounds currently being hired by leading alternative asset management firms Junior Senior Where are these candidates hired from? Fair compensation being offered to new talent Retaining current talent (compensation) 23