PE Fund of funds actually, position, another, between, thread

pacmandefense

What are the exit opportunities from a PE FoF role? It was pointed out in another thread that there is no skills overlap between a HF fof position and actually working in a HF, does the same hold for a PE fof?

sabaruch

If your role is to bring in the $$$ then there is overlap both with HFoF and PEFoF. If your role is to do analysis then the overlap is much lower.

sabre

I know less about these roles, but I would guess at a minimum you could lateral to the marketing / fund raising department of a PE firm because you would have inside knowledge of the PE FoF business, which would be valuable for raising assets. You might also be able to move to a pension fund or large asset allocation firm that needs someone to help evaluate PE exposure. Stuff like that would be a reasonable jump. Thinking you will become Gordon Gekko would not be reasonable.

It's pretty simple -- if you want to work at a PE fund on the investment team, you need to understand businesses and financing. In a PE FoF role, you are evaluating manager strategies, which doesn't teach you much of anything about businesses and financing. So the switch is very tough. Same thing for HFs -- why is the guy evaluating L/S, algo strategies, market neutral, etc. going to know anything about picking stocks? He looked at a bunch of firms with various strategies and met some managers, but why is that going to help my fund make money? It makes no sense.

LBriscoe

That's is not true. While the transition is difficult (getting into PE is difficult to start with), it's not impossible.

Many FoPEF does co-investment, so there's still a good chance if you have done a deal or two but definitely as an entry level PE analyst unless you can source deals.

Marketing/BD is a logical transition, risk management is also possible. The fact you have strong operational due diligence experience, you should be able to contribute there.

If you are hoping for an senior investment analyst position then that's definitely not going to happen...

neil1234

thanks for the response, another question - what is coinvestment?

YAhmed

Palantir Wrote:
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> thanks for the response, another question - what
> is coinvestment?

You invest alongside other investors. If you're a PEFoF then you are probably investing alongside another PE investor who sourced the transaction.

Analti_Calte

like brain_wash_your_face said. A PE shop normally would have the capability to source a deal and PE FoF does not. However, PE FoF normally have access to capital and PE shop may or may not for variety of reasons. So PE will then bring the deal and see if the FoF guy want to 'chip in'.

It's like you invest with Paulson and bought some Sino-Forest yourself after he (or someone in his fund) presented you the investment thesis. hahahah...