Private Equity Compensation on the Rise
This summer subprime woes wreaked havoc on the markets and many private equity deals headed south as the cost of borrowing rose. But a recent study published by Dow Jones Private Equity Analyst shows that times are not so tough for private equity professionals. As pension funds continue to funnel money into alternative assets, compensation for executives at U.S. buyout firms is on the rise.
Total compensation in 2007, including salary, bonus and carried interest distributions, rose 23.6% to $340,000 for the median U.S. private equity professional, according to results from the third edition of the Private Equity Analyst-Holt Compensation Study. The survey polled more than 1,700 professionals from 153 private-equity firms, and the results include venture, buyout and mezzanine professionals.
International private equity funds may also be attracting executives looking for entrepreneurial opportunities. The Wall Street Journal reports that European funds set up about 20 years ago such as Permira, Apax Partners and BC Partners are looking to expand into Asia or the United States. The move may offer executives the opportunity to set up new regional operations and charter new investment territories.
Executive search firm, A.E. Feldman says private equity remains a significant player in the global economy and capital markets, generating huge profits. The firm says the industry has and will continue to attract top investment professionals.
