Thelander IF Digest: November 2024

Salary Trends by AUM & Getting Your Salary Increase Right

Welcome to this month’s edition of the Investment Firm Digest. While base salary is a fundamental compensation component, annual salary increases serve as a strategic tool aimed at achieving multiple objectives. They reward performance, address cost of living adjustments, and help retain key talent. Given the nuanced role of salary increases at investment firms, it’s essential to align them with market benchmarks and the strategic value of each role within the firm.

In this issue, we delve into how compensation trends have evolved since 2020 for managing general partners at firms with either less than $1 billion or more than $1 billion in total AUM. The Thelander Platform allows you to customize compensation data tables more granularly, from less than $25 million to over $7 billion in AUM for over 80 positions. Let’s explore the data.

Chart 1 and 2 tracks changes at the 75th percentile for total cash and carried interest for Managing General Partners at investment firms by AUM. We see the following:

Less Than $1 Billion AUM:

• There’s a decrease at the 75th percentile in total cash for Managing General Partners from $750,000 in 2020 to $650,000 in 2024. 
• However, there’s an increase in carried interest over the same period – going from 45% to 50%. 

More than $1 Billion AUM:

• Total cash at the 75th percentile has risen from $1,700,000 in 2020 to $2,000,000 in 2024.
• Carried interest percentages have decreased from a peak of 39.00% in 2021 to 30.50% in 2023, which has remained steady YoY. 

How do salary increase come into play with market data? Typically, if your base salary aligns with median values, your potential increase could be higher compared to those at the 75th percentile or maximum. 

Chart 3 from last year’s Salary Increase & Bonus Report illustrates the following:

More junior positions are more likely to receive a salary increase – across all AUM brackets.
Salary increase percentages varied between 3.5% to 8.8%, influenced by the seniority of the investment professional position.

The bottom line:
 To determine how much your salary increase you increase for 2025, fill out the Thelander-PitchBook Salary Increase & Bonus Survey at no cost. Your confidentiality is guaranteed. Participation also grants you 12 months of free access to real-time data on base salaries, bonuses and carried interest percentages on Thelander’s proprietary platform – allowing you to access the the most comprehensive dataset available to venture capital and private equity firms.

Participate in the Thelander-PitchBook Salary Increase & Bonus Survey