Private credit fund paying $713k average is hiring hundreds
For anyone who missed the memo, private credit is the place to be in 2023. Banks are rushing into private credit (take Deutsche Bank, which just launched a new business in the area), funds historically focused on private equity are rushing into private credit (take Apollo, which said today that more than 80% of its assets are now in its credit and hybrid units) and private credit investors themselves are doubling down on private credit.
For many in the private credit sector, the latter are the best place to be.
"I wouldn't want to work for a bank now," one private credit specialist tells us. "My earning potential there will be undermined by the poor performance of other areas of the business."
The same might be said for working for a hybrid fund with historic private equity exposure. Apollo revealed today that its income from selling private equity investments fell 92% in the third quarter. Spending on compensation and benefits at Apollo was down 18% year-on-year in the first nine months.
Funds focused on private credit, by comparison, are thriving and hiring. Ares published its third quarter results yesterday, revealing that headcount has risen by 350 people or 18% year-on-year, to 2,800 and that compensation per head is on track to reach an average of annualized $713k in 2023, all things being equal in the fourth quarter.
Private credit is a growth industry. In September, Ares' CEO Mike Arougheti predicted the private credit market will double to three trillion within five years. Ares, which is based in Los Angeles, has just opened a second floor at its office in London's West End in preparation for further expansion.
It's not just Ares, and it's not just London. BlackRock thinks the private credit market will double by 2028. Marathon Asset Management is hiring five new people for direct lending in New York. New York-based Blue Owl is opening a new office in Abu Dhabi. Alongside Julian Salisbury from Goldman Sachs, Sixth Street has recently hired Johannes Vavrosky from Barclays in London as a managing director. Ares has recently added Moelis and Rothschild analysts as associates.
This is only scratching the surface of the private credit hiring party. Four months ago, Richard Risch CEO of private markets specialist recruiter The Risch Group, estimated there were 1,200 private credit job moves in the first six months of the year alone. "Big time" hiring had been happening, said Risch.
How do you get a job in the private credit sector? Vavrosky was a financial sponsors banker at Barclays. Ares' recent associate recruits worked in leveraged finance and M&A. Risch said funds like people with origination and structuring experience. They also like people who can help the raise new funds. However, funds' hiring needs aren't restricted to investment professionals: as they build teams, they're also looking for quants, technologists and accountants.
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