Forum FAQ

Preferences

Watched Topics

Watched Forums

Comp expectations for Private Equity in China?

Tags : property, business, travel, technology, nightlife, events, food, food, expat_services

Shanghai Expat Forum Index » City Living Forums » Questions and Answers

Author

Message

wstreeter

Newbie

Joined: Mar 28, 2008
Posts: 6

Status: Offline

Posted: July 29, 2008 - 05:47 PM
Post subject: Comp expectations for Private Equity in China?

I recently interviewed with a small private equity firm in Shanghai with about 15 employees. The firm was founded about a year ago and is still in the start-up stage. I met the founders and two other people on the team and they seemed to be nice people. Both the founders are American with solid investment backgrounds.

So they liked me and wanted to talk about compensation expectations. They told me they pay close to what Warburg Pincus pays in China for senior associate/junior VP level positions - on an after-tax basis, total annual comp (they say they don't pay bonus) is about 280K RMB. My first thought was it was low and I'm very doubtful that's Warburg Pincus level. Nothing has been put in writing yet and I didn't say anything about whether I would be happy or not with that number.

I understand China is a different market from NY, London, or HK. Before I came to Shanghai, I worked at one of the top 3 i-banks on Wall Street and of course I don't expect to get the same pay here. I came back for personal/family reasons and money is not the driving force. But still I don't want to sell myself cheap and would like to get an idea on the reasonable pay range here.

Anyone has any insight on how much I may negotiate for an increase in comp? Any help would be appreciated.

foodcoma

Reacher

Joined: Apr 29, 2006
Posts: 318

Status: Offline

Posted: July 29, 2008 - 06:30 PM

That seems very low for an associate/jr VP position, especially if they don't pay bonus. Actually, I haven't heard of a PE shop that doesn't pay bonus. BTW, if a PE shop has 15 people, then it's not small (not by head count anyway).

Were you in corporate finance or principal investment/PE at the ibank in wall street? If so, and you have more than 5 years of relevant experience, then you should definitely be asking for more.

austfella

Talker

Joined: Jan 30, 2007
Posts: 81

Status: Offline

Posted: July 29, 2008 - 11:23 PM

280k - not even USD 50k, seems very low for this position. Never heard of a PE that does not pay bonus either.

May try to use the rates in HK as a benchmark. Given so many people from the Mainland are going there, the rates should be similar?

jeffry3

Reacher

Joined: June 01, 2007
Posts: 238
Location: 中山
Status: Offline

Posted: July 29, 2008 - 11:57 PM

do you speak mandarin btw? it would make a whole lot difference

Andreas
Board Legend

Joined: Feb 27, 2004
Posts: 10162
Location: s/v Waratah

Posted: July 30, 2008 - 01:09 AM

jeffry3 wrote:

do you speak mandarin btw? it would make a whole lot difference

The only difference it makes is that you can tell them to go and get fucked with such a lousy offer in their own language. My local senior sales engineers are making more than that.

_________________
Time is the very substance of life; its golden minutes are the only stones we have with which to build. That spiritual building, not made with hands.

underh20
Board Legend

Joined: Sep 27, 2006
Posts: 12702
Location: Veggie-Free Zone

Posted: July 30, 2008 - 11:13 AM
Post subject: Re: Comp expectations for Private Equity in China?

wstreeter wrote:

For a Chinese salary 23k per month after tax is ok. Junior VP sounds like a decent title, but it really is rather insignificant. In the Chinese finance industry there are VPs earning 10k or less a month.

If you were Chinese, I doubt you'd get more. As an expat, if they like you and need you, maybe you can push for more.

YariGuy

LoopKicker

Joined: July 13, 2004
Posts: 878
Location: Puxi
Status: Offline

Posted: July 30, 2008 - 11:53 AM

This is a joke. At the major funds you should be getting 5-10 times that, WITHOUT THE CARRY. Analysts are getting paid more than 3x what you quote.

underh20
Board Legend

Joined: Sep 27, 2006
Posts: 12702
Location: Veggie-Free Zone

Posted: July 30, 2008 - 12:19 PM

Fund houses pay more than private equity firms in China.

_________________
"If I need to buy a TV, I'll definitely buy a Japanese TV. A Chinese TV might explode." -- Jackie Chan

foodcoma

Reacher

Joined: Apr 29, 2006
Posts: 318

Status: Offline

Posted: July 30, 2008 - 12:51 PM

Most local first year pe analysts would probably get that as their comp. Total comp would obviously increase exponentially after that, especially since it's pretty much impossible to find anyone with relevant pe experience in China.

You should ask for more. Assuming one knows what he or she is doing, it's not a problem to manage a usd 1b fund with fewer than 6-8 people, including support staff. And they have 15 people - no idea why they need so many unless they already have billions committed. Assuming they have a 2/20 structure, which is typical for pe houses, it means that they should easily be able to afford to pay you a lot more for your base.