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Heidrick & Struggles 1
Mid-Year Review August 2013
Laurie Thompson Chad Astmann Paul Charles
Charlie KershawSteven McCrindle
Talent and Compensation Trends in Asset Management Distribution
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 2
Introduction 3
Key Findings 4
Part One – Summary Broad General Trends across Traditional, Multi-Product, Hedge Funds, 5 Placement Agents and Private Equity Firms
Profile of the Talent Pool 6
Capital Raising and Retention 9
Compensation 12
General Team Structure 14
The Product Specialist Role 15
Beyond Capital Raising and Retention – Measuring Performance 15
Global Hiring Environment and Strategies – Expanding Beyond the United States 16
Part Two – Focus on Firm Types 19Traditional Asset Managers – Independent 21
Traditional Asset Managers – Bank-Owned 33
Multi-Product Asset Manager – Independent 46
Multi-Product Asset Manager – Bank-Owned 58
Hedge Funds 70
Private Equity 83
Real Estate 96
Placement Agents 108
Part Three – Compensation 119Base Salary 123
Bonus 131
Do MBAs earn more? 139
Characteristics of an Outstanding Distribution Professional 141
Emerging Trends for 2014 and Beyond 142
Topics for Further Exploration 143
Study Methodology 144
Contents
Heidrick & Struggles 3
IntroductionWhile market conditions have stabilized since our last look at alternatives asset management distribution in 2009, the fundraising environment remains exceptionally competitive. In addition, several trends have emerged that are increasing the complexity of capital raising and retention while opening windows of opportunity for those firms best positioned to capture market share. These trends include the convergence of alternatives and traditional investing, increased attention to the high-net-worth client segment and markedly higher investor expectations regarding fees, transparency, risk and communication. The challenges and opportunities presented by these trends inspired us to publish a follow-on paper and to expand it across the broader asset management industry to include hedge funds, traditional asset managers, real estate, private equity and placement agents.
As asset management firms evolve—reshaping their business models, redefining their investment strategies and creating stronger leadership and succession plans—distribution talent within them is evolving as well. The distribution professionals at the front lines are increasingly diverse, frequently in transition and under great pressure to perform at what seems like a higher level every year.
What motivates and inspires them? What characteristics set the outstanding ones apart from the pack? How important is technical depth vs. relationships? How are different firms addressing client coverage needs? How are they thinking about handling overseas investors? Can firms leverage their existing sales force to market new types of products? How are firms sourcing, attracting, evaluating, compensating and retaining talent? What topics are front of mind for 2014 and beyond?
A significant focus of Heidrick & Struggles’ work in recent years has been guiding clients through these dynamics and helping them recruit, retain and structure their distribution teams in the best way possible. In this paper we will share the perspectives and insights we have gained from these experiences. We will also be sharing the results of a recent survey we conducted of sales, investor relations and client services professionals from across the asset management industry. For the sake of simplicity, we will refer to people working in all of these job functions as “distribution professionals” throughout the paper.
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 4
Key Findings• Distinctions between alternatives, traditional and multi-product asset management firms
are increasingly blurred.
• Nearly 41% of respondents said their firms are actively recruiting or opportunistically meeting with potential candidates to fill distribution roles.
• About 21% of respondents in the United States said their firms are recruiting distribution professionals for UK/Europe, 24% for Asia and 11% for the Middle East.
• The majority of distribution professionals (about 57%) are not actively looking but are open to considering new opportunities if presented.
• Respondents said the most compelling reasons for changing firms are (in order) the opportunity to build the sales/marketing effort, firm culture, compensation and people. This has strong implications for talent retention.
• There has been a considerable amount of movement within the past three years, with 50% of respondents indicating they changed jobs during that period.
• When changing jobs, 14% of respondents reported receiving “make whole” bonuses, 28% received a sign-on bonus and nearly 39% were given a minimum guaranteed bonus “floor.”
• Respondents are cautiously optimistic about bonuses for 2013; 55% expect an increase compared to 2012 while 20.5% said it was still too early in the year to tell.
• There is a disconnect between the way most firms compensate distribution professionals (purely discretionary) and the way most distribution professionals prefer to be compensated (hybrid formula/discretionary).
• About 45% of respondents hold MBA degrees. We found that having an MBA tends to increase base salary but the impact on bonuses is less clear.
• Beyond capital raising and retention, the top-ranked performance metric is teamwork and collaboration across the firm.
• 17.4% of respondents hold the CFA designation—an increasingly valuable differentiator.
• 61% of respondents said capital raising is more difficult than three years ago and 48% said capital retention is more difficult than three years ago.
• Nearly two-thirds of capital inflows came from new investors and one-third from existing investors in 2012.
• The perceived level of difficulty for raising and retaining capital is quite high, but the median amount of capital raised per marketer is trending positively for 2013 compared to 2012 across almost all firm types.
• There is notable variability among distribution professionals within different firm types about many of the topics we explored
Broad General Trends across Traditional, Multi-Product, Hedge Funds, Placement Agents and Private Equity Firms
Part One – Summary
Contents
Profile of the Talent Pool 6Capital Raising and Retention 9Compensation 12General Team Structure 14The Product Specialist Role 15Beyond Capital Raising and Retention – Measuring Performance 15Global Hiring Environment and Strategies – Expanding Beyond the United States 16
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 6
Profile of the Talent Pool The population of distribution professionals is quite diverse, increasingly sophisticated around products and frequently
on the move.
Academics:
Historically, the majority of professionals grew up on the sell side or in classic sales roles; today professionals are also
entering the business directly from undergraduate or graduate programs or transitioning in from investment roles.
Increasingly, the CFA has become an important differentiation, with 17.42% of respondents holding this certification. In
addition, 44.92% of respondents hold MBAs and 11.59% hold a Master’s degree.
What is the highest level of education you have completed?
Answer Options Response Percent Response Count
Bachelor’s Degree 41.1% 202
Master’s Degree (non MBA) 11.6% 57
MBA 44.9% 221
Ph.D. 2.4% 12
answered question 492
Certifications:Do you hold any certifications?
Answer Options Response Percent Response Count
CFA 17.4% 77
CAIA 6.1% 27
CPA 1.8% 8
Series 3 22.4% 99
Series 6 12.2% 54
Series 7 72.2% 319
Series 24 19.9% 88
Series 31 3.8% 17
Series 63 62.0% 274
Series 65 17.0% 75
No other certifications 10.9% 48
Other (please specify) 51
answered question 442
Other certifications cited were series 66, CIMA and CPA
Movement:
At Heidrick & Struggles, we value stability and tenure in the professionals we recruit. That may sound like a curious
statement coming from executive recruiters who are often brought in to effect change, but our clients look for such
demonstrations of loyalty and therefore we do as well. In our view, the frequency of job moves during recent years has
presented hiring managers with a real challenge. Beyond questions about culture fit that frequent moves raise, it has
Part One – Summary
Summ
ary
Heidrick & Struggles 7
also become increasingly difficult to assess performance and effectiveness, particularly around capital raising, given
that candidates often are not in their seats long enough to build momentum within an institutional sales cycle that
typically takes one to four years.
How pervasive is this trend and what is driving this frequency of moves?
Interestingly, 50.1% of survey respondents reported changing jobs during the past three years.
Did you change firms during the past 3 years?
Answer Options Response Percent Response Count
Yes 50.1% 190
No 49.9% 189
answered question 379
When considering their motivation, we were surprised to see that while compensation remained an important driver of
job changes, more than one-quarter of respondents who had made a move within the past three years reported their
compensation remained flat from firm to firm, and very few ranked compensation as the number one driver in making
the move.
If yes, by what percentage did your total compensation change?
Answer Options Response Percent Response Count
Remained Flat 26.7% 56
Increased by 1% - 9% 7.1% 15
Increased by 10% - 19% 14.8% 31
Increased by 20% - 29% 15.7% 33
Increased by 30% - 39% 10.0% 21
Increased by 40%+ 8.1% 17
Decreased by 1% - 9% 1.0% 2
Decreased by 10% - 19% 3.8% 8
Decreased by 20% - 29% 3.3% 7
Decreased by 30% - 39% 3.8% 8
Decreased by 40%+ 5.7% 12
answered question 210
We often advise clients that minimum floors or “make-whole” bonuses are required to attract the strongest talent—a
particularly relevant topic moving into the second half of the year. When changing jobs within the past three years,
14% of individuals reported receiving a “make-whole” bonus and 38.7% were offered a minimum bonus floor
Summ
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Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 8
If you changed firms, were you offered a (check all that apply):
Answer Options Response Percent Response Count
Sign-on bonus 28.0% 52
Buy out of equity 11.3% 21
Make whole bonus (100% of anticipated bonus at previous firm) 14.0% 26
Minimum bonus floor (% of anticipated bonus at previous firm) 38.7% 72
Not applicable 37.1% 69
Other (please specify) 11
answered question 186
Beyond compensation, what motivates a distribution professional to consider a new opportunity?
We asked survey participants to rank reasons for changing firms in order of importance. The top four drivers (based on
an average ranking) were:
1. Opportunity to grow and build the marketing effort
2. Firm culture
3. Compensation
4. People
If you changed firms in the past 3 years, please rank your primary motivation(s) for change:Answered: 187
8.96
6.67Management opportunity
Compensation
Firm Culture
Brand
Marketability of products
Layoffs or restructuring
Ability to have influence outside of fundraising
Level of value placed on marketing
People
Opportunity to grow/build the marketing effort
Greater opportunities for advancement
Firm's willingness to meet client expectataions
9.07
6.99
6.94
7.20
8.84
9.45
8.09
5.96
8.57
6.93
In our experience, most candidates are not actively looking to make a change but are open to our outreach calls. This
view is supported by feedback from survey respondents, with the majority (56.8%) characterizing their current state of
mind as not actively looking but open to considering new opportunities.
Summ
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Heidrick & Struggles 9
Looking at those who described themselves as “actively looking,” when we combined employed and unemployed
respondents we realized they made up more than one-fifth (22.6%) of the population.
These numbers are extraordinarily high for a group of professionals who already experienced high levels of movement
between 2009–2012, and raise interesting challenges for managers regarding retention.
How would you characterize your current state of mind?
Answer Options Response Percent Response Count
Actively looking (unemployed) 4.8% 17
Actively looking (currently employed) 17.8% 63
Not looking but open to considering new opportunities if presented 56.8% 201
Not open to considering new opportunities 20.6% 73
Other (please specify) 9
answered question 354
Capital Raising & RetentionThere is clear consensus that raising and retaining capital has become increasingly competitive among asset
management firms due to the broader economic climate as well as challenges unique to the industry. Clients have
higher expectations than ever, and even the most “institutionalized” asset managers have had to raise their game to
keep pace.
We found that 61.5% of respondents think capital raising is more difficult than three years ago, 17.5% think it is about
the same and 20.9% think it is easier. Nearly half (48.5%) said retention of capital is more difficult than three years ago,
40.7% said about the same and just 10.7% said it is easier.
What is your view on the level of difficulty in raising capital today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 8.8% 33
Moderately more difficult 23.3% 88
Significantly more difficult 29.4% 111
About the same 17.5% 66
Moderately easier 17.5% 66
Significantly easier 3.4% 13
Other (please specify) 7
answered question 377
Summ
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Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 10
What is your view on the level of difficulty in retaining client assets today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 12.3% 46
Moderately more difficult 23.1% 86
Significantly more difficult 13.1% 49
About the same 40.8% 152
Moderately easier 9.7% 36
Significantly easier 1.1% 4
Other (please specify) 6
azznswered question 373
Percentage of inflows from new vs. existing investors
On average, respondents reported approximately two-thirds of capital coming from new investors and one-third
coming from existing investors in 2012.
Firm Type% Inflows from New
Investors % Inflows from Existing
Investors
Hedge Fund 59.70 40.30
Multi-product Asset Managers Bank Owned 63.42 36.58
Multi-product Asset Managers Independent 71.12 28.88
Private Equity 59.55 40.45
Real Estate 75.89 24.11
Traditional Asset Management Bank-Owned 70.00 30.00
Traditional Asset Management Independent 65.15 34.85
Summary Average 65.48 34.52
Summ
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Heidrick & Struggles 11
We also looked at capital raised per individual in 2012 and YTD 2013 and found a broad range of experiences across
firm types, assets under management, strategies and experience levels, which may warrant deeper exploration. We
were surprised by comparatively strong capital-raising levels YTD 2013 vs. 2012, especially given the high level of
perceived difficulty and the fact that we are only halfway through the year.
Capital raising levels per marketer (as of June 7, 2013)
Firm Type Year Mean Median Range
# of marketers that raised zero capital
% of marketers that raised zero capital Notes
Hedge Fund 2012 302,525,000 100,000,000 0 - 5,000,000,000 12/61 19.67%
Hedge Fund 2013 315,546,875 150,000,000 0 - 2,000,000,000 9/64 14.06%
Traditional Asset Manager - Independent
2012 466,857,142 180,000,000 0 - 3,300,000,000 8/35 22.08%
Traditional Asset Manager - Independent
2013 771,478,947 190,000,000 0 - 4,000,000,000
4/40 10.00% Minus 2 outliers at $8bln and $10bln for 2013 YTD
Traditional Asset Manager - Bank-Owned
2012 805,538,461 270,000,000 0 - 3,000,000,000 2/15 13.33%
Traditional Asset Manager - Bank-Owned
2013 1,061,785,714 320,000,000 0 - 5,000,000,000 2/14 14.28%
Multi-Product Asset Manager - Independent
2012 459,826,923 250,000,000 0 - 3,000,000,000 5/52 9.61%
Multi-Product Asset Manager - Independent
2013 1,167,061,403 300,000,000 0 - 5,000,000,000 6/58 10.34% Minus 5 outliers citing $6bln, $7bln, $8bln, $10bln and $12bln
Multi-Product Asset Manager - Bank Owned
2012 400,285,714 250,000,000 0 - 2,000,000,000 2/28 7.14%
Multi-Product Asset Manager - Bank Owned
2013 331,678,571 115,000,000 0 - 1,500,000,000 4/29 13.79% Minus 1 outlier citing $5bln
Private Equity 2012 335,000,000 115,000,000 0 - 800,000,000 3/15 20.00% Minus 1 outlier citing 4bln
Private Equity 2013 725,166,666 275,000,000 0 - 5,000,000,000 5/18 27.77% Four marketers up over $1bln
Real Estate 2012 131,166,666 100,000,000 0 - 522,000,000 4/12 33.33%
Real Estate 2013 177,318,181 162,500,000 0 - 650,000,000 3/11 27.27%
Placement Agents
2012 358,571,429 105,000,000 0 - 2,000,000,000 2/15 13.33%
Placement Agents
2013 494,000,000 500,000,000 0 - 1,000,000,000 1/16 6.25%
Summ
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Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 12
Compensation Broadly speaking, when looking at compensation across all levels, firm types and functions, we uncovered the
following insights:
Distribution professionals are cautiously optimistic about their bonus expectations for 2013, with 55% expecting an
increase, 20.5% saying it’s too early in the year to speculate and 6.9% expecting a decrease.
What are your bonus expectations for 2013 compared to 2012?
Answer Options Response Percent Response Count
Increased by less than 10% 10.5% 37
Increased by 11% - 15% 10.0% 35
Increased by 16% - 20% 8.3% 29
Increased by 21% - 25% 9.1% 32
Increased by 26% - 30% 3.1% 11
Increased by 31% - 35% 2.6% 9
Increased by 36% - 40% 6.3% 22
Increased by greater than 40% 5.1% 18
Flat from my 2012 bonus 17.7% 62
Decreased by less than 10% 2.0% 7
Decreased by 11% - 15% 0.3% 1
Decreased by 16% - 20% 0.9% 3
Decreased by 21% - 25% 0.3% 1
Decreased by 26% - 30% 0.6% 2
Decreased by 31% - 35% 1.1% 4
Decreased by 36% - 40% 0.3% 1
Decreased by greater than 40% 1.4% 5
Still too early in the year to estimate 20.5% 72
Other (please specify) 17
answered question 351
Summ
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Heidrick & Struggles 13
When looking at deferred compensation, we found that 67.82% of respondents had less than 10% of their cash bonus
deferred in 2012 while 31.1% had more than 10% of their cash bonus deferred.
What percentage of your cash bonus was deferred in 2012?
Answer Options Response Percent Response Count
Less than 10% 67.8% 236
10% - $19% 8.3% 29
20% - 29% 13.8% 48
30% - 39% 4.0% 14
40% - 49% 1.1% 4
50% - 60% 3.2% 11
60% - 70% 1.1% 4
70%+ 0.6% 2
answered question 348
We also looked at other components to a compensation package beyond cash, and found a high percentage of
distribution professionals are offered equity or equity-like participation.
What other components comprise your total compensation (check all that apply)?
Answer Options Response Percent Response Count
Stock options 30.5% 60
Participation in the funds 27.4% 54
Equity-like participation 45.7% 90
Sign on bonus 13.7% 27
Retention bonus 10.7% 21
Other (please specify) 25
answered question 197
Some of the “other” incentives respondents were offered include long-term compensation, profit sharing, commissions
and benefits such as 401(k) contributions.
For fundraising professionals, the debate over formulaic vs. discretionary bonuses continues. Anecdotal evidence
tells us that pure formulas are less common every year, and this view is supported by the survey data. Only 11% of
respondents are paid purely by formula and 44% are paid on a purely discretionary basis. The remainder receive
bonuses based on a hybrid model, often with a strong metrics component.
Which option best characterizes your current bonus structure?
Answer Options Response Percent Response Count
Purely formulaic 11.0% 39
Loosely formulaic driven by metrics 12.7% 45
Purely Discretionary 44.4% 157
Part formula / part discretionary 31.9% 113
Other (please specify) 6
answered question 354
Summ
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Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 14
Just about half (49%) of respondents reported a preference for the part formula/part discretionary hybrid model and
only 12.7% preferred a purely discretionary bonus structure. In our experience, a discretionary model provides firms
and hiring managers very useful control over managing compensation, particularly in volatile markets, and helps
support the cultivation of a collaborative team culture. But the disparity between the number of individuals being
paid on a purely discretionary basis (44%) and the number who actually prefer it (12.7%) raises a potentially interesting
opportunity for hiring firms looking to differentiate their compensation structure in order to attract and retain top
talent.
Which bonus structure do you prefer?
Answer Options Response Percent Response Count
Purely formulaic 16.6% 59
Loosely formulaic driven by metrics 15.5% 55
Purely Discretionary 12.7% 45
Part formula / part discretionary 49.0% 174
Agnostic 6.2% 22
Other (please specify) 7
answered question 355
General Team StructureLooking across the full spectrum of asset management firms, we compiled the average and median numbers of
professionals allocated to different job functions and looked at how teams are aligned.
Mean Median Range
# of sales/fundraising professionals 10.8 5 1 - 100
# of product specialists1 8.4 4 1 - 100
# of client-facing investor relations professionals 5.9 3 0 - 100
# of non–client-facing client services professionals
9.83 4 0 - 320
1. For firms employing product specialists
We also considered how teams are aligned.
How is coverage among your current sales team (primarily) aligned?
Answer Options Response Percent Response Count
Geographically 50.3% 186
Client Channel 20.0% 74
Product 1.9% 7
No formal alignment 27.8% 103
Other (please specify) 28
answered question 370
Summ
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Heidrick & Struggles 15
The Product Specialist RoleIn our client work, we have seen a high level of debate around the product specialist role. The product specialist has
become an increasingly important function as traditional and alternative investment strategies continue to converge
and clients demand more sophisticated product expertise. Most respondents view the role as either highly successful
or moderately successful within their firms, although many took a neutral position, noting the recent establishment
of the role within their firms and saying, in effect, it is still too early to judge its success. Some mentioned avoiding
the sales vs. investment team debate altogether by having product specialists report to product development, client
services or an unaffiliated managing principal. Several said their firms are in the process of hiring and integrating
product specialists for the first time this year.
Where do product specialists at your firm report to?
Answer Options Response Percent Response Count
Investment team 26.3% 94
Sales team 20.7% 74
Dual reporting to investment and sales teams 10.9% 39
Not applicable - my firm does not employ product specialists 42.2% 151
Other (please specify) 20
answered question 358
How successful has the product specialist been within your current firm?Answered: 367
N/A - my firm does notemploy product specialists
Not at all successful
Not very successful
Neutral
Moderately successful 26%
Highly successful 17%
13%
41%
1%
3%
Beyond Capital Raising and Retention – Measuring Performance We are often asked which metrics are employed when measuring the success of fundraising and client services
professionals. In our study, we found that the most frequently cited metric by far is teamwork and collaboration
with distribution colleagues, the investment and middle office teams, and senior management. The challenge with
quantifying collaboration, of course, is that it’s so subjective. To put it bluntly, even those professionals with the
sharpest elbows will define themselves as collaborative. Heidrick & Struggles evaluates this characteristic in candidates
through formal and informal referencing, a confidential exercise that often spans several stages in a candidate’s
career and that never results in direct feedback. (One area we would like to explore further in future research is
how firms define and evaluate collaboration and team orientation internally and whether that information is being
communicated.)
Summ
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Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 16
Many respondents cited activity (number of calls and meetings, consultant approval ratings, number of final meetings
etc.) as an important metric for measuring performance. Quite a few mentioned firm-building involvement in areas
such as product development, brand awareness, mentorship and recruiting: in essence, what is the distribution
professional’s strategic value to the firm beyond capital raising and retention? Client feedback and overall firm
performance were also cited as performance metrics.
Global Hiring Environment and Strategies –Expanding Outside the United States
In addition to deeper penetration within the United States market, asset management firms are increasingly looking
beyond their U.S. investor base for potential sources of capital. While the U.S. remains the most active recruiting
market for distribution professionals, a good number of the firms we surveyed reported either actively recruiting or
opportunistically meeting with potential candidates in the UK/Europe, Asia and the Middle East. And while 5.2% of
respondents reported a reduction in the size of their U.S. teams, projected reductions outside the U.S. are much lower,
ranging from 0.7% in the Middle East to 2.9% in UK/Europe through the remainder of 2013.
US: How would you best characterize your current firm’s hiring plans within *US* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 15.0% 52
Opportunistically meeting potential candidates 25.9% 90
Team will remain flat through year-end 53.9% 187
Currently reducing the size of the team 5.2% 18
Other (please specify) 5
answered question 347
Asia: How would you best characterize your current firm's hiring plans within *Asia* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 7.6% 24
Opportunistically meeting potential candidates 16.5% 52
Team will remain flat through year-end 25.9% 82
Currently reducing the size of the team 1.9% 6
No current presence or plans to expand in to Asia 48.1% 152
answered question 316
Summ
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Heidrick & Struggles 17
UK/Europe: How would you best characterize your current firm's hiring plans within *UK/European* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 7.3% 23
Opportunistically meeting potential candidates 13.7% 43
Team will remain flat through year-end 35.5% 111
Currently reducing the size of the team 2.9% 9
No current presence or plans to expand in the UK or Europe 40.6% 127
Other (please specify) 1
answered question 314
Middle East: How would you best characterize your current firm's hiring plans within *Middle Eastern* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 1.6% 5
Opportunistically meeting potential candidates 9.8% 30
Team will remain flat through year-end 23.3% 71
Currently reducing the size of the team 0.7% 2
No current presence or plans to expand in the Middle East 64.6% 197
Other (please specify) 5
answered question 305
In your view, what is the most effective strategy for a firm to expand its marketing effort overseas?
Answer Options Response Percent Response Count
Exporting an existing team member overseas 15.9% 52
Hiring an outside candidate within the local region 58.5% 192
Cover the region from the US 8.2% 27
Not applicable: my current firm does not have a marketing presence outside of the US
17.4% 57
Other (please specify) 16
answered question 328
How does your firm typically recruit sales & client services professionals? (Check all that apply)
Answer Options Response Percent Response Count
Leveraging industry network 57.7% 198
Sourcing investors 7.6% 26
LinkedIn 14.3% 49
Retained executive search 51.9% 178
Contingency executive search 24.2% 83
Professional associations 12.5% 43
Employee referrals 54.8% 188
Internal recruiting function 31.2% 107
Other (please specify) 4
answered question 343
Summ
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Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 18
There is considerable debate about how to penetrate markets outside the U.S. most effectively when firms decide
not to use a local placement agent. By far, the most effective strategy cited among respondents is to hire an outside
candidate from within the local geography (58.5%).
Considerations Unique to Asia and Europe
Asia (Author: Steven McCrindle, Hong Kong)
Firms that historically had reasonable success partnering with local intermediaries and flying in and out of Asia
to pick up business have been struggling to raise and retain assets from Asian investors over the past several
years. As a result, most firms have opted to put at least one sales person on the ground in Asia to manage client/
intermediary relationships. More progressive firms have built distribution teams of four to six professionals. The
question now isn’t really “should we have someone on the ground in Asia,” it’s “how many people do we need
on the ground in Asia?”
While it’s possible to cover the 20 largest institutional investors in Asia (excluding Japan) with one senior sales
person on the ground backed up by a sales support team in the head office, for firms looking to expand beyond
the top two or three institutional investors in individual Asian markets (Korea, Singapore, Hong Kong, Taiwan,
China, etc.), it’s imperative to add local language sales/client service capability.
Firms that use placement agents/intermediaries extensively in the region still benefit from having their own
sales people on the ground in Asia to manage the process in tandem with intermediaries where it makes
the most sense (e.g., Japanese corporate pension funds) and go direct where there’s little benefit in using an
intermediary (e.g., sovereign wealth funds). The largest distribution teams in the region take this approach.
Europe/UK (Author: Charlie Kershaw, London)
Marketing in Europe involves multiple cultural nuances, which supports the case for having staff on the ground
there. Even European hedge funds tend to organize their teams by sub-geography rather than channel for that
very reason.
There are very different eco-systems at work in the different markets. The UK investor base, for example, tends
to be consultant-led, and nurturing relationships with investors can be a very slow process. Scandinavia is seen
as quite advanced in the way its major investors allocate to alternatives, with a large number of direct investors
who will work actively to find the best funds for capital allocation within each strategy. Continental Europe,
however, tends to require a different approach; it is an imperfect market with many small investors and a heavier
emphasis on trust and relationships.
The major downside to adding dedicated marketing staff in Europe at present is the regulatory environment.
While some of the finer points in AIFMD are still not clear, the prevailing message is that it will greatly restrict
hedge funds from soliciting capital in Europe. Additionally, hedge funds that do have European investors will
have to become compliant with other parts of AIFMD, including compensation restrictions.
Summ
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Part Two – Focus on Firm Types
Contents
Traditional Asset Managers – Independent 21Traditional Asset Managers – Bank-Owned 33Multi-Product Asset Manager – Independent 46Multi-Product Asset Manager – Bank-Owned 58Hedge Funds 70Private Equity 83Real Estate 96Placement Agents 108
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 20
In Part One of this report, we looked at a number of trends related to distribution professionals in the asset management industry. In Part Two we will explore these trends as they relate more specifically to different firm types across traditional, alternatives and multi-product platforms. Given the amount of overlap and complexity within these firm structures, we did our best to segment them in a way that provides the most relevant insights into this dynamic and evolving industry. We asked survey respondents how they would best characterize their current firms, and it’s important to note that participants self-selected their categories.
With so much convergence happening across the asset management world, we acknowledge the difficulty of trying to categorize an industry in flux. For example, 10.3% of respondents chose “other” to describe their firm. In some cases, individuals from within the very same organization chose different categories. Overall, there is a lack of standardization about how firms are defined, and in future studies we will try to develop a more precisely defined structure. Finally, while we did receive feedback from participants working at hedge funds of funds, OCIOs and private equity fund of funds, the sample sizes in those cases were too limited to include them as categories in our analysis.
How would you characterize your current firm?Answered: 454
Traditional Asset Managers – Independent
Traditional Asset Managers – Bank-Owned
Multi-Product Asset Manager – Independent
Multi-Product Asset Manager – Bank-Owned
Hedge Funds
Private Equity
Hedge Fund of Funds
Private Equity Fund of Funds
Real Estate
Placement Agents
OCIO
15.2%
5.9%
22.0%
11.5%
20.9%
6.4%
3.3%
1.5%
5.1%
5.9%
2.2%
Part Two – Focus on Firm Types
Heidrick & Struggles 21
Traditional Asset M
anagers – Independent
Traditional Asset Managers – Independent
There has been significant movement over the past three years among distribution talent working for traditional asset
management firms. This phenomenon has been driven by a number of factors, including mergers and acquisitions,
shifting product focus, industry consolidation and compensation dynamics.
Of 54 distribution professionals who reported working for independent traditional asset managers, well over half (57%)
changed firms in the past three years. Although compensation is not the sole motive, a substantial majority (71%)
indicated they moved to a position that offered a pay increase, with 35% indicating a healthy bump of 10%-29% and
more than 10% seeing a 30% uptick over their previous compensation total. Nearly half (46%) were offered a minimum
bonus floor and almost 30% received a sign-on bonus. We find this data to be consistent with the pick-up in hiring and
increased demand for sales talent in the independent asset management space.
When asked to rank a dozen reasons for making a change on a scale from 1 to 10, respondents ranked layoffs/
restructuring lowest and opportunity to grow/build the market as the leading reason. Participants also rated firm culture
and people as significant draws. These factors were ranked surprisingly higher than others such as marketability of
products and firm brand value, which usually rate high in our conversations with distribution professionals.
Given heavy talent movement over the past three years, an uptick in compensation and motivation for change, we
thought it would be interesting to know how distribution professionals feel about changing platforms in the future.
When asked about their current state of mind, 14% of participants indicated they were looking actively for a new role
and 58% were open to considering new options if presented. Only 28% said they were not open to new opportunities.
We concluded that while the talent war is swinging to the side of supply, organizations with a good culture and
reasonable aspirations have a good opportunity to at least engage leading talent in conversations.
The relatively low level of distribution professionals indicating an active approach to changing firms may be related to
the positive outlook on 2013 compensation. About 57% of respondents indicated an increase in compensation over
2012, with the majority expecting a moderate increase of less than 15%. A few indicated an increase above 30%, but such
cases seem to be rare. We also found that the cash compensation for more than 70% of the respondents was minimally
deferred but that nearly half (48%) received some form of stock options or equity.
When it comes to determining bonuses, we found that most compensation models have some degree of discretionary
determination; only 14% of participants said their bonuses are determined under purely formulaic structures. Notably,
36% of respondents indicated working under a purely discretionary model and 34% have a blended (discretionary/
formulaic) model. These figures are surprisingly mismatched with what distribution professionals actually want. When
asked what their preference would be on bonus structure, more than half (52%) indicated a blended compensation
structure.
In addition to capital raising and retention, respondents in this category cited team collaboration, consultant-relations
ratings and general business development activity as commonly used performance metrics. Although designing a sales
compensation model is an ongoing challenge for all asset managers, independent managers have comparatively greater
freedom and should be constantly seeking input from the sales team and executive committee regarding structure.
Our survey revealed some decidedly positive results worth mentioning, especially with regard to asset raising and asset
flows. On average, marketers are experiencing larger sales in 2013 (median of $190 million per salesperson) than in 2012
(median of $180 million raised). Notably, 65% of the flows have been coming from new investors.
We also took a look at how firms are currently structuring their distribution organizations. Respondents indicated the
average number of pure sales members within their firms is 7, product specialists 6 and client services 7. Sales teams
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 22
Traditional Asset M
anagers – Independent
are organized predominantly along geographic lines (60%) rather than client channels (17%). Notably, we found that
more than 50% of firms now employ product specialists and that they are evenly split between reporting to sales and
reporting to the investment teams. For the most part, the sales talent polled in this survey said product specialists are
either moderately successful (21%) or have had only minimal impact (18%) on the sales process. Several respondents
noted the newly established nature of these roles within their organization, and were taking a wait-and-see approach
to its effectiveness.
Of the respondents who provided information on their firms’ hiring plans, most seem to think their firms are active
across the globe. The region targeted for highest growth appears to be the United States, with 37% of participants
indicating their firm is either opportunistically or actively recruiting to their sales ranks there. There seems to be
moderate activity in Asia (26%) and in UK/Europe (21%), with participants indicating moderate or aggressive hiring
activity and planning. The Middle East seems the most stagnant with nearly 80% of participants indicating no plans for
hiring in the region. When asked how to cover a new region most effectively, most respondents (58%) indicated that
hiring external talent from within the region is the most effective approach.
Lastly, the survey participants were in clear agreement that a good recruitment strategy includes a healthy
combination of approaches. When asked how their firm typically finds talent, more than 60% said the firm calls on a
retained search firm, 51% said employee referrals and 43% said the firm’s own industry network. Consistent with these
findings, more than 60% of our respondents indicated that their organization had hired a retained search firm in the
past two years to find distribution talent.
What is the highest level of education you have completed
Answer Options Response Percent Response Count
Bachelor's Degree 46.4% 32
Master's Degree (non MBA) 4.3% 3
MBA 49.3% 34
Ph.D. 0.0% 0
answered question 69
Did you change firms during the past 3 years?
Answer Options Response Percent Response Count
Yes 57.4% 31
No 42.6% 23
answered question 54
Heidrick & Struggles 23
Traditional Asset M
anagers – Independent
If you changed firms within the past 3 years, by what percentage did your total compensation change?
Answer Options Response Percent Response Count
Remained Flat 16.1% 5
Increased by 1% - 9% 9.7% 3
Increased by 10% - 19% 22.6% 7
Increased by 20% - 29% 12.9% 4
Increased by 30% - 39% 6.5% 2
Increased by 40%+ 3.2% 1
Decreased by 1% - 9% 0.0% 0
Decreased by 10% - 19% 6.5% 2
Decreased by 20% - 29% 3.2% 1
Decreased by 30% - 39% 9.7% 3
Decreased by 40%+ 9.7% 3
answered question 31
If you changed firms, were you offered a (check all that apply):
Answer Options Response Percent Response Count
Sign-on bonus 28.6% 10
Buy out of equity 8.6% 3
Make whole bonus (100% of anticipated bonus at previous firm) 11.4% 4
Minimum bonus floor (% of anticipated bonus at previous firm) 45.7% 16
Not applicable 31.4% 11
Other (please specify) 2
answered question 35
If you changed firms in the past 3 years, please rank your primary motivation(s) for change:Answered: 41
9.05
7.51
9.23
6.22
6.89
7.18
8.51
9.66
7.50
6.33
8.26
7.00
Management opportunity
Compensation
Firm Culture
Brand
Marketability of products
Layoffs or restructuring
Ability to have influence outside of fundraising
Level of value placed on marketing
People
Opportunity to grow/build the marketing effort
Greater opportunities for advancement
Firm's willingness to meet client expectataions
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 24
How would you characterize your current state of mind?
Answer Options Response Percent Response Count
Actively looking (unemployed) 0.0% 0
Actively looking (currently employed) 14.0% 7
Not looking but open to considering new opportunities if presented 58.0% 29
Not open to considering new opportunities 28.0% 14
Other (please specify) 1
answered question 50
What is your view on the level of difficulty in raising capital today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 11.1% 6
Moderately more difficult 27.8% 14
Significantly more difficult 22.2% 17
About the same 15.1% 8
Moderately easier 13.2% 7
Significantly easier 1.9% 1
Other (please specify) 3
answered question 53
What is your view on the level of difficulty in retaining client assets today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 13.7% 7
Moderately more difficult 23.5% 12
Significantly more difficult 7.8% 4
About the same 43.1% 22
Moderately easier 9.8% 5
Significantly easier 2.0% 1
Other (please specify) 1
answered question 51
Percentage of inflows from new vs. existing investors
Firm Type% Inflows from New
Investors % Inflows from Existing
Investors
Traditional Asset Management – Independent 65.15 34.85
Traditional Asset M
anagers – Independent
Heidrick & Struggles 25
Capital raising levels per marketer
Firm Type Year Mean Median Range
# of marketers that raised zero capital
% of marketers that raised
zero capital Notes
Traditional Asset Manager - Independent
2012 $466,857,142 $180,000,000 $0 - $3,300,000,000 8/35 22.08%
Traditional Asset Manager - Independent
2013 *YTD
$771,478,947 $190,000,000 $0 - $4,000,000,000 4/40 10.00% Minus 2 outliers at $8bln and $10bln for 2013 YTD
* YTD as of June 2013
What are your bonus expectations for 2013 compared to 2012?
Answer Options Response Percent Response Count
Increased by less than 10% 17.6% 9
Increased by 11% - 15% 11.8% 6
Increased by 16% - 20% 5.9% 3
Increased by 21% - 25% 5.9% 3
Increased by 26% - 30% 3.9% 2
Increased by 31% - 35% 2.0% 1
Increased by 36% - 40% 3.9% 2
Increased by greater than 40% 5.9% 3
Flat from my 2012 bonus 17.6% 9
Decreased by less than 10% 3.9% 2
Decreased by 11% - 15% 0.0% 0
Decreased by 16% - 20% 2.0% 1
Decreased by 21% - 25% 2.0% 1
Decreased by 26% - 30% 3.9% 2
Decreased by 31% - 35% 3.9% 2
Decreased by 36% - 40% 0.0% 0
Decreased by greater than 40% 0.0% 0
Still too early in the year to estimate 9.8% 5
Other (please specify) 0
answered question 51
Traditional Asset M
anagers – Independent
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 26
What percentage of your cash bonus was deferred in 2012?
Answer Options Response Percent Response Count
Less than 10% 69.4% 34
10% - $19% 8.2% 4
20% - 29% 16.3% 8
30% - 39% 4.1% 2
40% - 49% 0.0% 0
50% - 60% 2.0% 1
60% - 70% 0.0% 0
70%+ 0.0% 0
answered question 49
What other components comprise your total compensation (check all that apply)?
Answer Options Response Percent Response Count
Stock options 48.3% 14
Participation in the funds 3.4% 1
Equity-like participation 37.9% 11
Sign on bonus 24.1% 7
Retention bonus 3.4% 1
Other (please specify) 7
answered question 29
Which option best characterizes your current bonus structure?
Answer Options Response Percent Response Count
Purely formulaic 14.0% 7
Loosely formulaic driven by metrics 16.0% 8
Purely Discretionary 36.0% 18
Part formula / part discretionary 34.0% 17
Other (please specify) 0
answered question 50
Which bonus structure do you prefer?
Answer Options Response Percent Response Count
Purely formulaic 23.5% 12
Loosely formulaic driven by metrics 11.8% 6
Purely Discretionary 11.8% 6
Part formula / part discretionary 51.0% 26
Agnostic 2.0% 1
Other (please specify) 0
answered question 51
Traditional Asset M
anagers – Independent
Heidrick & Struggles 27
How are independent traditional asset managers structuring their distribution efforts?
Mean Median Range
# of sales/fundraising professionals 7.3 6 2 - 60
# of product specialists (for firms with product specialists)
5.7 4 1 - 30
# of client-facing investor relations professionals 5.9 3 1 - 50
# of non–client-facing client services professionals
6.9 4 0 - 50
How is coverage among your current sales team (primarily) aligned?
Answer Options Response Percent Response Count
Geographically 59.6% 31
Client Channel 17.3% 9
Product 1.9% 1
No formal alignment 21.2% 11
Other (please specify) 5
answered question 52
Where do product specialists at your firm report in to?
Answer Options Response Percent Response Count
Investment team 20.4% 10
Sales team 20.4% 10
Dual Reporting to investment and sales teams 14.3% 7
Not applicable - my firm does not employ product specialists 44.9% 22
Other (please specify) 4
answered question 49
How successful has the product specialist role been within your current firm?Answered: 53
N/A - my firm does notemploy product specialists
21%
11%
19%
45%
0%
4%
Highly successful
Moderately successful
Neutral
Not very successful
Not at all successful
Traditional Asset M
anagers – Independent
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 28
US: How would you best characterize your current firm’s hiring plans within *US* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 10.4% 5
Opportunistically meeting potential candidates 27.1% 13
Team will remain flat through year-end 60.4% 29
Currently reducing the size of the team 2.1% 1
Other (please specify) 1
answered question 48
Asia: How would you best characterize your current firm’s hiring plans within *Asia* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 7.1% 3
Opportunistically meeting potential candidates 19.0% 8
Team will remain flat through year-end 21.4% 9
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in to Asia 52.4% 22
answered question 42
UK/Europe: How would you best characterize your current firm's hiring plans within *UK/European* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 7.5% 3
Opportunistically meeting potential candidates 15.0% 6
Team will remain flat through year-end 25.0% 10
Currently reducing the size of the team 7.5% 3
No current presence or plans to expand in the UK or Europe 45.0% 18
Other (please specify) 0
answered question 40
Middle East: How would you best characterize your current firm's hiring plans within *Middle Eastern* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 2.6% 1
Opportunistically meeting potential candidates 7.7% 3
Team will remain flat through year-end 12.8% 5
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in the Middle East 76.9% 30
Other (please specify) 2
answered question 39
Traditional Asset M
anagers – Independent
Heidrick & Struggles 29
In your view, what is the most effective strategy for a firm to expand its marketing effort overseas?
Answer Options Response Percent Response Count
Exporting an existing team member overseas 8.3% 4
Hiring an outside candidate within the local region 58.3% 28
Cover the region from the US 12.5% 6
Not applicable: my current firm does not have a marketing presence outside of the US
20.8% 10
Other (please specify) 0
answered question 48
How does your firm typically recruit sales & client services professionals? (Check all that apply)
Answer Options Response Percent Response Count
Leveraging industry network 42.9% 21
Sourcing investors 0.0% 0
LinkedIn 8.2% 4
Retained executive search 61.2% 30
Contingency executive search 16.3% 8
Professional associations 16.3% 8
Employee referrals 51.0% 25
Internal recruiting function 24.5% 12
Other (please specify) 2
answered question 49
Has your firm used retained search in the past 2 years to hire sales & client services professionals?
Answer Options Response Percent Response Count
Yes 60.0% 30
No 30.0% 15
I don't know 10.0% 5
answered question 50
Traditional Asset M
anagers – Independent
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 30
Traditional Asset Managers – Independent: Demographics
What is your current job title?
Answer Options Response Percent Response Count
Associate 0.0% 0
Senior Associate 0.0% 0
Vice President 14.3% 9
Senior Vice President 15.9% 10
Director/Principal 27.0% 17
Managing Director (individual contributor) 15.9% 10
Managing Director (management role) 25.4% 16
Partner 0.0% 0
N/A - Not currently employed 1.6% 1
Other (please specify) 8
answered question 63
How many years of total work experience do you have?
Answer Options Response Percent Response Count
5 - 10 1.5% 1
11 - 15 14.7% 10
16 - 20 19.1% 13
21 - 25 35.3% 24
26+ 29.4% 20
answered question 68
How many years of asset management distribution experience do you have?
Answer Options Response Percent Response Count
5 - 10 21.7% 15
11 - 15 29.0% 20
16 - 20 26.1% 18
21 - 25 14.5% 10
26+ 8.7% 6
answered question 69
Traditional Asset M
anagers – Independent
Heidrick & Struggles 31
Where do you work?
Answer Options Response Percent Response Count
New York 40.4% 23
Connecticut 8.8% 5
Boston 12.3% 7
Chicago 21.1% 12
San Francisco 5.3% 3
Los Angeles 5.3% 3
Minneapolis 0.0% 0
Philadelphia 5.3% 3
Miami 0.0% 0
Houston 0.0% 0
Dallas 1.8% 1
Washington D.C. 0.0% 0
Other (please specify) 12
answered question 57
Which investment products are offered by your current firm (check all that apply)?
Answer Options Response Percent Response Count
Long Only Equity 86.8% 59
Long Only Fixed Income 54.4% 37
Hedge Funds 26.5% 18
Private Equity 10.3% 7
Hedge Fund of Funds 13.2% 9
Private Equity Fund of Funds 8.8% 6
Real Estate 14.7% 10
Commodities 14.7% 10
Infrastructure 8.8% 6
Other (please specify) 5
answered question 68
How would you characterize the primary focus of your current role?
Answer Options Response Percent Response Count
Sales / Fundraising 56.7% 38
Investor Relations / Client Service (client facing) 3.0% 2
Investor Relations / Client Service (non-client facing / support) 3.0% 2
Hybrid Sales & Investor Relations 9.0% 6
Product Specialist 7.5% 5
Consultant Relations 20.9% 14
Other (please specify) 5
answered question 67
Traditional Asset M
anagers – Independent
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 32
What are the total assets under management of your current firm?
Answer Options Response Percent Response Count
<$200mln 1.4% 1
$200mln - $500mln 1.4% 1
$500mln - $1bln 4.3% 3
$1bln 1.4% 1
$2bln 7.2% 5
$3bln 2.9% 2
$4bln 4.3% 3
$5bln 2.9% 2
$6bln 0.0% 0
$7bln 0.0% 0
$8bln 1.4% 1
$9bln 2.9% 2
$10bln 4.3% 3
$11bln 1.4% 1
$12bln 1.4% 1
$13bln 0.0% 0
$14bln 0.0% 0
$15bln 0.0% 0
$16bln 1.4% 1
$17bln 0.0% 0
$18bln 1.4% 1
$19bln 1.4% 1
$20bln - $29bln 11.6% 8
$30bln - $39bln 0.0% 0
$40bln - $49bln 8.7% 6
$50bln - $59bln 4.3% 3
$60bln+ 33.3% 23
Other (please specify) 0
answered question 69
Traditional Asset M
anagers – Independent
Heidrick & Struggles 33
Traditional Asset Managers – Bank-Owned
With only 27 survey respondents characterizing their firms as bank-owned traditional asset managers, our sample size
for this category is relatively small and definite conclusions are difficult to draw. Nevertheless, we observed several
trends worth exploring.
There are a number of similarities between distribution professionals at bank-owned traditional asset managers and
their counterparts at independent firms. One difference we noted, however, has to do with changing jobs. More than
44% of respondents working for bank-owned traditional asset managers switched firms within the past three years,
compared to 57% of those at independent firms. Although the sample size is too small for statistical significance, we
can say that of the six individuals at bank-owned firms who reported about compensation in their new job, two saw
their compensation remain flat, three experienced an uptick and one saw a decrease; half were offered a minimum
bonus floor. This group ranked the opportunity to grow and build a marketing effort as the highest motivator for
changing firms.
About three-fifths of respondents (61.5%) said they were not looking to change jobs but were open to considering new
opportunities. It is worth noting that 15.4% of the respondents in the bank-owned category were not employed at the
time, compared to 0% of the respondents at independent traditional firms.
The percentage of marketers who think it is more difficult to raise capital today than three years ago is the same at
both bank-owned and independent traditional asset managers: 61%. Their views on capital retention also are virtually
identical, with about 45% of respondents in both categories saying capital retention was difficult. Reported inflow rates
were quite similar as well.
However, the median reported levels of capital raising per marketer were notably higher for bank-owned asset
managers, at $270 million for 2012 and $320 million YTD for 2013. This is most likely due to firm size rather than any
difference in talent, with 70% of respondents employed at bank-owned firms with more than $60 billion in assets
under management.
Another notable difference between the two groups relates to bonus expectations for 2013. About 36% of distribution
professionals with bank-owned asset managers said it’s still too early in the year to estimate bonuses, compared to
only 9.8% of those at independent firms.
Deferred bonus levels were essentially the same in both groups, with 70% reporting that less than 10% of their 2012
bonus was deferred.
We observed another notable difference regarding bonus structure: 78.6% of those at bank-owned firms characterized
their bonus as purely discretionary compared with 36% at independent firms. Given the small sample size, we are
curious whether there is truly such a difference between the two firm types. Most respondents in both groups
reported a preference for a part formulaic/part discretionary bonus structure.
How are bank-owned traditional asset managers structuring their distribution efforts? Because they are working at
larger organizations, the distribution teams at bank-owned traditional asset managers tend to be much larger than
those at independent firms, with an average of 24 sales and fundraising professionals who are aligned primarily by
geography (55.6%) or client channel (44.4%). None of the 18 respondents to this question chose “no formal alignment”
when describing their team’s structure, a notable difference from the independent firms, where 21.2% of respondents
said that was the case.
Traditional Asset M
anagers – Bank-Ow
ned
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 34
Traditional Asset M
anagers – Bank-Ow
ned
Product specialists are another differentiator between the two groups. About 53% of respondents at bank-owned
firms said their product specialists report to the investment team; at independent firms, reporting lines were equally
divided, with 20.4% reporting to the investment team and 20.4% to the sales team. Only 17.6% of respondents said
their firms do not employ product specialists, compared to 44.9% at independent managers. Those at bank-owned
firms also viewed the product specialist role within their firm as more successful than their independent counterparts,
with 38.89% of respondents choosing “highly successful” when asked to rate the function’s effectiveness.
The hiring forecast for the remainder of 2013 in the United States among bank-owned traditional asset managers looks
quite similar to the independent firms, with 16.7% of respondents saying their firms were actively recruiting at the
time of the survey (June 2013) and 33.3% saying their firms were opportunistically meeting candidates. In Asia, hiring
seems more robust, with 16.7% of respondents reporting their firms were actively recruiting and 25% opportunistically
meeting candidates. However, we need to be mindful that our sample size of 12 on this question is likely too small
to draw a solid conclusion. Similarly, while we are excited to see 18.2% of firms actively recruiting in the UK/Europe
region, our sample size on this question is 11 respondents.
Overall, while the small sample makes it difficult to support any firm views about this category, it is interesting to note
some of the characteristics that are unique to distribution professionals at bank-owned traditional asset managers,
not the least being how they characterize themselves given the diversity of products reported on these platforms (see
demographics below).
What is the highest level of education you have completed?
Answer Options Response Percent Response Count
Bachelor's Degree 25.9% 7
Master's Degree (non MBA) 25.9% 7
MBA 48.1% 13
Ph.D. 0.0% 0
answered question 27
Did you change firms during the past 3 years?
Answer Options Response Percent Response Count
Yes 44.4% 8
No 55.6% 10
answered question 18
Heidrick & Struggles 35
If you changed firms within the past three years, by what percentage did your total compensation change?
Answer Options Response Percent Response Count
Remained Flat 33.3% 2
Increased by 1% - 9% 16.7% 1
Increased by 10% - 19% 0.0% 0
Increased by 20% - 29% 0.0% 0
Increased by 30% - 39% 0.0% 0
Increased by 40%+ 33.3% 2
Decreased by 1% - 9% 0.0% 0
Decreased by 10% - 19% 0.0% 0
Decreased by 20% - 29% 16.7% 1
Decreased by 30% - 39% 0.0% 0
Decreased by 40%+ 0.0% 0
answered question 6
If you changed firms, were you offered a (check all that apply):
Answer Options Response Percent Response Count
Sign-on bonus 16.7% 1
Buy out of equity 16.7% 1
Make whole bonus (100% of anticipated bonus at previous firm) 16.7% 1
Minimum bonus floor (% of anticipated bonus at previous firm) 50.0% 3
Not applicable 33.3% 2
Other (please specify) 0
answered question 6
Traditional Asset M
anagers – Bank-Ow
ned
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 36
Traditional Asset M
anagers – Bank-Ow
ned
If you changed firms in the past 3 years, please rank your primary motivation(s) for change:Answered: 6
8.33
7.60
7.60
7.75
6.67
8.80
8.83
10.82
6.83
4.60
9.33
7.80
Management opportunity
Compensation
Firm Culture
Brand
Marketability of products
Layoffs or restructuring
Ability to have influence outside of fundraising
Level of value placed on marketing
People
Opportunity to grow/build the marketing effort
Greater opportunities for advancement
Firm's willingness to meet client expectataions
How would you characterize your current state of mind?
Answer Options Response Percent Response Count
Actively looking (unemployed) 15.4% 2
Actively looking (currently employed) 7.7% 1
Not looking but open to considering new opportunities if presented 61.5% 8
Not open to considering new opportunities 15.4% 2
Other (please specify) 1
answered question 13
What is your view on the level of difficulty in raising capital today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 11.1% 2
Moderately more difficult 27.8% 5
Significantly more difficult 22.2% 4
About the same 22.2% 4
Moderately easier 11.1% 2
Significantly easier 5.6% 1
Other (please specify) 0
answered question 18
Heidrick & Struggles 37
What is your view on the level of difficulty in retaining client assets today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 16.7% 3
Moderately more difficult 16.7% 3
Significantly more difficult 11.1% 2
About the same 38.9% 7
Moderately easier 11.1% 2
Significantly easier 5.6% 1
Other (please specify) 0
answered question 18
Percentage of inflows from new vs. existing investors
Firm Type% Inflows from New
Investors % Inflows from Existing
Investors
Traditional Asset Management – Bank-Owned 70.00 30.00
Capital raising levels per marketer
Firm Type Year Mean Median Range
# of marketers that raised zero capital
% of marketers that raised zero capital Notes
Traditional Asset Manager - Bank Owned
2012 $805,538,461 $270,000,000 $0 - $3,000,000,000 2/15 13.33%
Traditional Asset Manager - Bank Owned
2013 *YTD
$1,061,785,714 $320,000,000 $0 - $5,000,000,000 2/14 14.28%
* YTD as of June 2013
Traditional Asset M
anagers – Bank-Ow
ned
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 38
Traditional Asset M
anagers – Bank-Ow
ned
What are your bonus expectations for 2013 compared to 2012?
Answer Options Response Percent Response Count
Increased by less than 10% 14.3% 2
Increased by 11% - 15% 7.1% 1
Increased by 16% - 20% 7.1% 1
Increased by 21% - 25% 14.3% 2
Increased by 26% - 30% 0.0% 0
Increased by 31% - 35% 0.0% 0
Increased by 36% - 40% 0.0% 0
Increased by greater than 40% 0.0% 0
Flat from my 2012 bonus 14.3% 2
Decreased by less than 10% 7.1% 1
Decreased by 11% - 15% 0.0% 0
Decreased by 16% - 20% 0.0% 0
Decreased by 21% - 25% 0.0% 0
Decreased by 26% - 30% 0.0% 0
Decreased by 31% - 35% 0.0% 0
Decreased by 36% - 40% 0.0% 0
Decreased by greater than 40% 0.0% 0
Still too early in the year to estimate 35.7% 5
Other (please specify) 2
answered question 14
What percentage of your cash bonus was deferred in 2012?
Answer Options Response Percent Response Count
Less than 10% 70.6% 12
10% - $19% 5.9% 1
20% - 29% 11.8% 2
30% - 39% 5.9% 1
40% - 49% 0.0% 0
50% - 60% 5.9% 1
60% - 70% 0.0% 0
70%+ 0.0% 0
answered question 17
Heidrick & Struggles 39
What other components comprise your total compensation (check all that apply)?
Answer Options Response Percent Response Count
Stock options 33.3% 3
Participation in the funds 11.1% 1
Equity-like participation 44.4% 4
Sign on bonus 11.1% 1
Retention bonus 22.2% 2
Other (please specify) 2
answered question 9
Which option best characterizes your current bonus structure?
Answer Options Response Percent Response Count
Purely formulaic 0.0% 0
Loosely formulaic driven by metrics 7.1% 1
Purely Discretionary 78.6% 11
Part formula / part discretionary 14.3% 2
Other (please specify) 0
answered question 14
Which bonus structure do you prefer?
Answer Options Response Percent Response Count
Purely formulaic 0.0% 0
Loosely formulaic driven by metrics 14.3% 2
Purely Discretionary 14.3% 2
Part formula / part discretionary 64.3% 9
Agnostic 7.1% 1
Other (please specify) 0
answered question 14
How are Bank-Owned Traditional Asset Managers structuring their distribution efforts?
Mean Median Range
# of sales/fundraising professionals 24 10.5 2 - 100
# of product specialists (for firms with product specialists)
5.2 3.5 1 - 15
# of client facing investor relations professionals 4.3 3 2 - 10
# of non - client facing client services professionals
10.1 6 1 - 50
Traditional Asset M
anagers – Bank-Ow
ned
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 40
Traditional Asset M
anagers – Bank-Ow
ned
How is coverage among your current sales team (primarily) aligned?
Answer Options Response Percent Response Count
Geographically 55.6% 10
Client Channel 44.4% 8
Product 0.0% 0
No formal alignment 0.0% 0
Other (please specify) 0
answered question 18
Where do product specialists at your firm report in to?
Answer Options Response Percent Response Count
Investment team 52.9% 9
Sales team 23.5% 4
Dual Reporting to investment and sales teams 5.9% 1
Not applicable - my firm does not employ product specialists 17.6% 3
Other (please specify) 2
answered question 17
How successful has the product specialist role been within your current firm?Answered: 18
N/A - my firm does notemploy product specialists
17%
39%
22%
17%
0%
6%
Highly successful
Moderately successful
Neutral
Not very successful
Not at all successful
US: How would you best characterize your current firm’s hiring plans within *US* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 16.7% 2
Opportunistically meeting potential candidates 33.3% 4
Team will remain flat through year-end 50.0% 6
Currently reducing the size of the team 0.0% 0
Other (please specify) 0
answered question 12
Heidrick & Struggles 41
Asia: How would you best characterize your current firm’s hiring plans within *Asia* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 16.7% 2
Opportunistically meeting potential candidates 25.0% 3
Team will remain flat through year-end 0.0% 0
Currently reducing the size of the team 8.3% 1
No current presence or plans to expand in to Asia 50.0% 6
answered question 12
UK/Europe: How would you best characterize your current firm's hiring plans within *UK/European* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 18.2% 2
Opportunistically meeting potential candidates 9.1% 1
Team will remain flat through year-end 9.1% 1
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in the UK or Europe 63.6% 7
Other (please specify) 0
answered question 11
Middle East: How would you best characterize your current firm's hiring plans within *Middle Eastern* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 0.0% 0
Opportunistically meeting potential candidates 0.0% 0
Team will remain flat through year-end 18.2% 2
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in the Middle East 81.8% 9
Other (please specify) 0
answered question 11
In your view, what is the most effective strategy for a firm to expand its marketing effort overseas?
Answer Options Response Percent Response Count
Exporting an existing team member overseas 9.1% 1
Hiring an outside candidate within the local region 63.6% 7
Cover the region from the US 9.1% 1
Not applicable: my current firm does not have a marketing presence outside of the US
18.2% 2
Other (please specify) 2
answered question 11
Traditional Asset M
anagers – Bank-Ow
ned
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 42
Traditional Asset M
anagers – Bank-Ow
ned
How does your firm typically recruit sales & client services professionals? (Check all that apply)
Answer Options Response Percent Response Count
Leveraging industry network 38.5% 5
Sourcing investors 0.0% 0
LinkedIn 7.7% 1
Retained executive search 69.2% 9
Contingency executive search 23.1% 3
Professional associations 7.7% 1
Employee referrals 46.2% 6
Internal recruiting function 15.4% 2
Other (please specify) 0
answered question 13
Has your firm used retained search in the past 2 years to hire sales & client services professionals?
Answer Options Response Percent Response Count
Yes 57.1% 8
No 21.4% 3
I don't know 21.4% 3
answered question 14
Heidrick & Struggles 43
Traditional Asset Managers – Bank Owned: Demographics
What is your current job title?
Answer Options Response Percent Response Count
Associate 0.0% 0
Senior Associate 0.0% 0
Vice President 13.0% 3
Senior Vice President 17.4% 4
Director/Principal 13.0% 3
Managing Director (individual contributor) 8.7% 2
Managing Director (management role) 39.1% 9
Partner 0.0% 0
N/A - Not currently employed 8.7% 2
Other (please specify) 4
answered question 23
How many years of total work experience do you have?
Answer Options Response Percent Response Count
5 - 10 0.0% 0
11 - 15 11.1% 3
16 - 20 33.3% 9
21 - 25 25.9% 7
26+ 29.6% 8
answered question 27
How many years of asset management distribution experience do you have?
Answer Options Response Percent Response Count
5 - 10 11.1% 3
11 - 15 25.9% 7
16 - 20 37.0% 10
21 - 25 14.8% 4
26+ 11.1% 3
answered question 27
Traditional Asset M
anagers – Bank-Ow
ned
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 44
Traditional Asset M
anagers – Bank-Ow
ned
Where do you work?
Answer Options Response Percent Response Count
New York 50.0% 10
Connecticut 5.0% 1
Boston 25.0% 5
Chicago 10.0% 2
San Francisco 5.0% 1
Los Angeles 0.0% 0
Minneapolis 0.0% 0
Philadelphia 5.0% 1
Miami 0.0% 0
Houston 0.0% 0
Dallas 0.0% 0
Washington D.C. 0.0% 0
Other (please specify) 7
answered question 20
Which investment products are offered by your current firm (check all that apply)?
Answer Options Response Percent Response Count
Long Only Equity 74.1% 20
Long Only Fixed Income 77.8% 21
Hedge Funds 33.3% 9
Private Equity 18.5% 5
Hedge Fund of Funds 18.5% 5
Private Equity Fund of Funds 14.8% 4
Real Estate 29.6% 8
Commodities 22.2% 6
Infrastructure 18.5% 5
Other (please specify) 4
answered question 27
How would you characterize the primary focus of your current role?
Answer Options Response Percent Response Count
Sales / Fundraising 62.5% 15
Investor Relations / Client Service (client facing) 8.3% 2
Investor Relations / Client Service (non client facing / support) 0.0% 0
Hybrid Sales & Investor Relations 4.2% 1
Product Specialist 0.0% 0
Consultant Relations 25.0% 6
Other (please specify) 2
answered question 24
Heidrick & Struggles 45
What are the total assets under management of your current firm?
Answer Options Response Percent Response Count
<$200mln 0.0% 0
$200mln - $500mln 0.0% 0
$500mln - $1bln 0.0% 0
$1bln 0.0% 0
$2bln 0.0% 0
$3bln 0.0% 0
$4bln 0.0% 0
$5bln 3.7% 1
$6bln 0.0% 0
$7bln 3.7% 1
$8bln 0.0% 0
$9bln 0.0% 0
$10bln 0.0% 0
$11bln 0.0% 0
$12bln 0.0% 0
$13bln 0.0% 0
$14bln 0.0% 0
$15bln 0.0% 0
$16bln 0.0% 0
$17bln 0.0% 0
$18bln 0.0% 0
$19bln 0.0% 0
$20bln - $29bln 11.1% 3
$30bln - $39bln 7.4% 2
$40bln - $49bln 0.0% 0
$50bln - $59bln 3.7% 1
$60bln+ 70.4% 19
Other (please specify) 0
answered question 27
Traditional Asset M
anagers – Bank-Ow
ned
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 46
Multi-Product Asset Manager – Independent
Our survey of distribution professionals at multi-product asset managers includes responses from a wide range of
organizations, including many firms that have recently expanded beyond their historical roots. We did not clearly
define parameters for inclusion in this category; rather, survey participants self-selected into this group through
question 7, “How would you characterize your current firm?”
The profile of the talent pool for independent multi-product asset managers mirrors the overall industry in terms
of academics, although respondents in this category reported a slightly higher rate of CFA designation (22.68%)
compared to the industry as a whole (17.4%).
Movement rates during the past three years were also similar at 52.6%. The majority (50.9%) of individuals at
independent multi-product organizations who changed firms saw a compensation increase, with 28.6% remaining flat
and 20.3% experiencing a decrease. Candidates who joined independent multi-product firms reported higher rates
for sign-on bonuses (38.1%), equity buy-outs (16.7%), make-whole bonuses (16.7%) and minimum bonus floors (40.5%)
than the industry as a whole.
Firm culture was the highest-ranked motivator for making a move, with compensation ranking second; the
opportunity to grow and build the marketing effort was tied for third with people. Respondents characterized their
current state of mind as follows: 27.1% actively looking, 48.6% not looking but open to considering new opportunities
and 24.3% not open to considering new opportunities.
The perceived level of difficulty for capital raising and retention among distribution professionals at independent
multi-product firms mirrors that of the industry overall, with 59.2% of respondents saying fundraising is more difficult
and 50.7% saying client retention is more difficult than three years ago. Respondents reported that 71.12% of inflows
in 2012 came from new investors, slightly higher than the industry average. The median amount of capital raised per
marketer at independent multi-product firms was $250 million in 2012 and $300 million YTD for 2013. It is worth noting
that five outliers cited significant capital raises ranging from $6 billion to $12 billion for 2013.
Bonus expectations for 2013 are similar to the overall industry, with a slightly higher percentage of respondents (60.1%)
expecting an increase in their total compensation, 14.7% expecting bonuses to remain flat, 7.8% expecting a decrease
and 17.3% indicating it was still too early in the year to estimate. We did not find any meaningful differences in the
way total compensation is structured, with similar rates of deferred compensation, stock options, participation in the
funds, equity-like participation, sign-on bonuses and retention bonuses. Bonus structure is also similar to the industry
norm, with 14.7% of respondents on a purely formulaic plan. The only interesting difference we observed was a higher
preference among distribution professionals at independent multi-asset firms for a purely formulaic structure, with
26.7% of respondents expressing a preference for a purely formulaic structure compared to the industry average of
16.6%.
Distribution teams in this category are more likely to be formally structured than in the industry as a whole, with 57.9%
of respondents indicating the teams are aligned by geography, 26.3% by client channel and 2.6% by product; only
13.2% of respondents indicated no formal alignment.
The product specialist role is fairly common within independent multi-product firms, with only 15.3% of respondents
saying their firm does not have this function. About 43% of respondents indicated that product specialists report to the
investment team, 30.6% to the sales team and 11.1% have a dual reporting line. Overall, the product specialist function
seems to be viewed positively and successfully by the great majority of survey participants.
Multi-Product A
sset Managers – Independent
Heidrick & Struggles 47
Beyond capital raising and retention, how are independent multi-asset managers measuring performance?
Interestingly, activity (number of meetings, etc.) was cited as the leading performance metric for multi-product asset
managers. In addition to capital raising and retention, the top three performance metrics were (in order):
1. Activity
2. Team collaboration
3. Firm building
Hiring activity for distribution professionals among independent multi-product asset managers is mixed. 17.1%
of respondents said their firms were actively recruiting distribution professionals in the United States and 34.2%
were opportunistically meeting candidates—recruiting rates that are similar to the industry overall. Growth and
penetration outside the U.S. seem much stronger for the independent multi-product managers than the broader
industry, however. Only 32.8% of respondents said their firm has no presence or plans to expand in Asia compared to
an industry average of 48.1%. The numbers for UK/Europe are 20.9% and 40.6% respectively, and 44.8% compared to
64.6% for the Middle East.
What is the highest level of education you have completed?
Answer Options Response Percent Response Count
Bachelor's Degree 42.0% 42
Master's Degree (non MBA) 12.0% 12
MBA 44.0% 44
Ph.D. 2.0% 2
answered question 100
Did you change firms during the past 3 years?
Answer Options Response Percent Response Count
Yes 52.6% 40
No 47.4% 36
answered question 76
If yes, by what percentage did your total compensation change?
Answer Options Response Percent Response Count
Remained Flat 28.6% 14
Increased by 1% - 9% 2.0% 1
Increased by 10% - 19% 8.2% 4
Increased by 20% - 29% 16.3% 8
Increased by 30% - 39% 12.2% 6
Increased by 40%+ 12.2% 6
Decreased by 1% - 9% 2.0% 1
Decreased by 10% - 19% 6.1% 3
Decreased by 20% - 29% 4.1% 2
Decreased by 30% - 39% 2.0% 1
Decreased by 40%+ 6.1% 3
answered question 49
Multi-Product A
sset Managers – Independent
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 48
Multi-Product A
sset Managers – Independent
If you changed firms, were you offered a (check all that apply):
Answer Options Response Percent Response Count
Sign-on bonus 38.1% 16
Buy out of equity 16.7% 7
Make whole bonus (100% of anticipated bonus at previous firm) 16.7% 7
Minimum bonus floor (% of anticipated bonus at previous firm) 40.5% 17
Not applicable 31.0% 13
Other (please specify) 3
answered question 42
If you changed firms in the past 3 years, please rank your primary motivation(s) for change:Answered: 40
8.87
5.44
9.74
6.81
6.43
7.24
8.85
8.85
8.55
6.06
8.73
7.16
Management opportunity
Compensation
Firm Culture
Brand
Marketability of products
Layoffs or restructuring
Ability to have influence outside of fundraising
Level of value placed on marketing
People
Opportunity to grow/build the marketing effort
Greater opportunities for advancement
Firm's willingness to meet client expectataions
How would you characterize your current state of mind?
Answer Options Response Percent Response Count
Actively looking (unemployed) 6.8% 5
Actively looking (currently employed) 20.3% 15
Not looking but open to considering new opportunities if presented 48.6% 36
Not open to considering new opportunities 24.3% 18
Other (please specify) 4
answered question 74
Heidrick & Struggles 49
What is your view on the level of difficulty in raising capital today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 5.3% 4
Moderately more difficult 28.9% 22
Significantly more difficult 25.0% 19
About the same 17.1% 13
Moderately easier 21.1% 16
Significantly easier 2.6% 2
Other (please specify) 0
answered question 76
What is your view on the level of difficulty in retaining client assets today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 6.5% 5
Moderately more difficult 27.3% 21
Significantly more difficult 16.9% 13
About the same 40.3% 31
Moderately easier 9.1% 7
Significantly easier 0.0% 0
Other (please specify) 1
answered question 77
Percentage of inflows from new vs. existing investors
Firm Type% Inflows from New
Investors % Inflows from Existing
Investors
Multiproduct Asset Managers – Independent 71.12 28.88
Capital raising levels per marketer
Firm Type Year Mean Median Range
# of marketers that raised
zero capital
% of marketers that raised zero capital Notes
Multi-Product Asset Manager - Independent
2012 $459,826,923 $250,000,000 $0 - $3,000,000,000 5/52 9.61%
Multi-Product Asset Manager - Independent
2013 *YTD
$1,167,061,403 $300,000,000 $0 - $5,000,000,000 6/58 10.34% Excluding 5 outliers citing $6bln, $7bln, $8bln, $10bln and $12bln
*YTD as of June 2013
Multi-Product A
sset Managers – Independent
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 50
Multi-Product A
sset Managers – Independent
What are your bonus expectations for 2013 compared to 2012?
Answer Options Response Percent Response Count
Increased by less than 10% 12.0% 9
Increased by 11% - 15% 13.3% 10
Increased by 16% - 20% 12.0% 9
Increased by 21% - 25% 6.7% 5
Increased by 26% - 30% 2.7% 2
Increased by 31% - 35% 4.0% 3
Increased by 36% - 40% 2.7% 2
Increased by greater than 40% 6.7% 5
Flat from my 2012 bonus 14.7% 11
Decreased by less than 10% 1.3% 1
Decreased by 11% - 15% 1.3% 1
Decreased by 16% - 20% 1.3% 1
Decreased by 21% - 25% 0.0% 0
Decreased by 26% - 30% 0.0% 0
Decreased by 31% - 35% 1.3% 1
Decreased by 36% - 40% 1.3% 1
Decreased by greater than 40% 1.3% 1
Still too early in the year to estimate 17.3% 13
Other (please specify) 2
answered question 75
What percentage of your cash bonus was deferred in 2012?
Answer Options Response Percent Response Count
Less than 10% 63.0% 46
10% - $19% 6.8% 5
20% - 29% 17.8% 13
30% - 39% 5.5% 4
40% - 49% 1.4% 1
50% - 60% 4.1% 3
60% - 70% 1.4% 1
70%+ 0.0% 0
answered question 73
Heidrick & Struggles 51
What other components comprise your total compensation (check all that apply)??
Answer Options Response Percent Response Count
Stock options 34.7% 17
Participation in the funds 24.5% 12
Equity-like participation 49.0% 24
Sign on bonus 16.3% 8
Retention bonus 14.3% 7
Other (please specify) 4
answered question 49
Which option best characterizes your current bonus structure?
Answer Options Response Percent Response Count
Purely formulaic 14.7% 11
Loosely formulaic driven by metrics 14.7% 11
Purely Discretionary 38.7% 29
Part formula / part discretionary 32.0% 24
Other (please specify) 2
answered question 75
Which bonus structure do you prefer?
Answer Options Response Percent Response Count
Purely formulaic 26.7% 20
Loosely formulaic driven by metrics 12.0% 9
Purely Discretionary 8.0% 6
Part formula / part discretionary 48.0% 36
Agnostic 5.3% 4
Other (please specify) 3
answered question 75
How are independent multi-product asset managers structuring their distribution efforts?
Mean Median Range
# of sales/fundraising professionals 17.8 9 2 - 100
# of product specialists (for firms with product specialists)
9.25 5 1 - 60
# of client facing investor relations professionals 9.6 5 1 - 60
# of non - client facing client services professionals *
14.1 8 1 – 100
*Excluding one outlier respondent who cited 320 non-client facing client services professionals at their firm
Multi-Product A
sset Managers – Independent
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 52
Multi-Product A
sset Managers – Independent
How is coverage among your current sales team (primarily) aligned?
Answer Options Response Percent Response Count
Geographically 57.9% 44
Client Channel 26.3% 20
Product 2.6% 2
No formal alignment 13.2% 10
Other (please specify) 7
answered question 76
Where do product specialists at your firm report in to?
Answer Options Response Percent Response Count
Investment team 43.1% 31
Sales team 30.6% 22
Dual Reporting to investment and sales teams 11.1% 8
Not applicable - my firm does not employ product specialists 15.3% 11
Other (please specify) 5
answered question 72
How successful has the product specialist role been within your current firm?Answered: 75
N/A - my firm does notemploy product specialists
36%
27%
15%
20%
0%
3%
Highly successful
Moderately successful
Neutral
Not very successful
Not at all successful
US: How would you best characterize your current firm’s hiring plans within *US* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 17.1% 13
Opportunistically meeting potential candidates 34.2% 26
Team will remain flat through year-end 44.7% 34
Currently reducing the size of the team 3.9% 3
Other (please specify) 0
answered question 76
Heidrick & Struggles 53
Asia: How would you best characterize your current firm’s hiring plans within *Asia* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 11.9% 8
Opportunistically meeting potential candidates 26.9% 18
Team will remain flat through year-end 26.9% 18
Currently reducing the size of the team 1.5% 1
No current presence or plans to expand in to Asia 32.8% 22
answered question 67
UK/Europe: How would you best characterize your current firm's hiring plans within *UK/European* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 10.4% 7
Opportunistically meeting potential candidates 25.4% 17
Team will remain flat through year-end 41.8% 28
Currently reducing the size of the team 1.5% 1
No current presence or plans to expand in the UK or Europe 20.9% 14
Other (please specify) 0
answered question 67
Middle East: How would you best characterize your current firm's hiring plans within *Middle Eastern* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 3.0% 2
Opportunistically meeting potential candidates 14.9% 10
Team will remain flat through year-end 35.8% 24
Currently reducing the size of the team 1.5% 1
No current presence or plans to expand in the Middle East 44.8% 30
Other (please specify) 1
answered question 67
In your view, what is the most effective strategy for a firm to expand its marketing effort overseas?
Answer Options Response Percent Response Count
Exporting an existing team member overseas 21.5% 14
Hiring an outside candidate within the local region 56.9% 37
Cover the region from the US 7.7% 5
Not applicable: my current firm does not have a marketing presence outside of the US
13.8% 9
Other (please specify) 6
answered question 65
Multi-Product A
sset Managers – Independent
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 54
Multi-Product A
sset Managers – Independent
How does your firm typically recruit sales & client services professionals? (Check all that apply)
Answer Options Response Percent Response Count
Leveraging industry network 58.3% 42
Sourcing investors 6.9% 5
LinkedIn 15.3% 11
Retained executive search 55.6% 40
Contingency executive search 27.8% 20
Professional associations 12.5% 9
Employee referrals 54.2% 39
Internal recruiting function 37.5% 27
Other (please specify) 0
answered question 72
Has your firm used retained search in the past 2 years to hire sales & client services professionals?
Answer Options Response Percent Response Count
Yes 53.4% 39
No 21.9% 16
I don't know 24.7% 18
answered question 73
Heidrick & Struggles 55
Multi-Product Asset Manager – Independent: Demographics
What is your current job title?
Answer Options Response Percent Response Count
Associate 0.0% 0
Senior Associate 0.0% 0
Vice President 24.7% 22
Senior Vice President 19.1% 17
Director/Principal 19.1% 17
Managing Director (individual contributor) 18.0% 16
Managing Director (management role) 11.2% 10
Partner 5.6% 5
N/A - Not currently employed 2.2% 2
Other (please specify) 11
answered question 89
How many years of total work experience do you have?
Answer Options Response Percent Response Count
5 - 10 5.0% 5
11 - 15 26.0% 26
16 - 20 21.0% 21
21 - 25 34.0% 34
26+ 14.0% 14
answered question 100
How many years of asset management distribution experience do you have?
Answer Options Response Percent Response Count
5 - 10 36.7% 36
11 - 15 21.4% 21
16 - 20 23.5% 23
21 - 25 11.2% 11
26+ 7.1% 7
answered question 98
Multi-Product A
sset Managers – Independent
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 56
Multi-Product A
sset Managers – Independent
Where do you work?
Answer Options Response Percent Response Count
New York 52.3% 46
Connecticut 4.5% 4
Boston 10.2% 9
Chicago 13.6% 12
San Francisco 9.1% 8
Los Angeles 8.0% 7
Minneapolis 0.0% 0
Philadelphia 2.3% 2
Miami 0.0% 0
Houston 0.0% 0
Dallas 0.0% 0
Washington D.C. 0.0% 0
Other (please specify) 14
answered question 88
Which investment products are offered by your current firm (check all that apply)?
Answer Options Response Percent Response Count
Long Only Equity 81.6% 80
Long Only Fixed Income 70.4% 69
Hedge Funds 71.4% 70
Private Equity 46.9% 46
Hedge Fund of Funds 27.6% 27
Private Equity Fund of Funds 23.5% 23
Real Estate 46.9% 46
Commodities 38.8% 38
Infrastructure 27.6% 27
Other (please specify) 10
answered question 98
How would you characterize the primary focus of your current role?
Answer Options Response Percent Response Count
Sales / Fundraising 57.6% 53
Investor Relations / Client Service (client facing) 6.5% 6
Investor Relations / Client Service (non client facing / support) 0.0% 0
Hybrid Sales & Investor Relations 13.0% 12
Product Specialist 3.3% 3
Consultant Relations 19.6% 18
Other (please specify) 10
answered question 92
Heidrick & Struggles 57
What are the total assets under management of your current firm?
Answer Options Response Percent Response Count
<$200mln 1.0% 1
$200mln - $500mln 1.0% 1
$500mln - $1bln 2.1% 2
$1bln 5.2% 5
$2bln 0.0% 0
$3bln 5.2% 5
$4bln 2.1% 2
$5bln 1.0% 1
$6bln 0.0% 0
$7bln 2.1% 2
$8bln 3.1% 3
$9bln 1.0% 1
$10bln 1.0% 1
$11bln 1.0% 1
$12bln 0.0% 0
$13bln 0.0% 0
$14bln 0.0% 0
$15bln 1.0% 1
$16bln 0.0% 0
$17bln 0.0% 0
$18bln 0.0% 0
$19bln 0.0% 0
$20bln - $29bln 7.2% 7
$30bln - $39bln 0.0% 0
$40bln - $49bln 4.1% 4
$50bln - $59bln 4.1% 4
$60bln+ 57.7% 56
Other (please specify) 4
answered question 97
Multi-Product A
sset Managers – Independent
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 58
Multi-Product Asset Manager – Bank-Owned
The sample size of 52 respondents for bank-owned multi-product firms is only about half the number of their
independent counterparts, but there are still a number of observations worth sharing about this talent pool.
There was a higher percentage of distribution professionals with MBAs at bank-owned firms (51.9%) than at their
independent counterparts. They changed jobs less frequently, with 42.5% having switched firms during the past
three years. Of those who did, 52.6% received a compensation increase. They were less likely to receive a sign-on
or make-whole bonus when accepting a new position, but were equally likely to receive a buy-out of equity and a
minimum bonus floor. The highest-ranking motivators for changing firms were the opportunity to grow and build the
marketing effort, followed by compensation and the level of value placed on marketing within the firm. Firm culture
ranked seventh. In contrast, firm culture ranked highest among distribution professionals at independent multi-asset
managers and second across the industry overall.
Another difference we observed with this group is their state of mind. Only 18.5% were actively looking for a new
position, which is lower than the industry overall or their peers at independent platforms. A large majority (68.4%) said
they were not looking but open to considering new opportunities if presented.
The perception of difficulty for raising and retaining capital among respondents at bank-owned multi-product
firms was high, with 67.5%% saying capital raising was significantly more difficult than three years ago and 47.5%
saying retention was more difficult. Capital from new investors made up 63.42% of inflows, on par with the industry
average but a bit lower than the independent firms. Interestingly, median amounts of capital raised per marketer in
this category were the same as their peers at independent firms in 2012 but are lower mid-way through 2013, with
respondents reporting a median of $250 million in 2012 and $115 million YTD in 2013.
Respondents were fairly confident about bonus expectations for 2013, with the majority (57.5%) expecting an
increase, 15% expecting bonuses to remain flat, 7.5% expecting a decrease and 20% saying it’s too early in the year
to estimate. Not surprisingly, deferred compensation rates were higher for this group, with 45.9% reporting deferred
bonus percentages of greater than 10% in 2012, with a range of 10%-70%. Other components of compensation are
fairly standard and include stock options, fund participation, equity-like participation, sign-on bonuses and retention
bonuses. Respondents at independent multi-product firms are more likely to receive stock options and less likely
to participate in the funds than their peers at independent firms. This group is also less likely to be paid on a purely
formulaic basis; the most common model is part formula/part discretionary, indicated by 50% of respondents. That
model lines up with this group’s preferred bonus structure, an alignment not found in many of the other firm types we
studied.
Distribution teams are most frequently aligned by geography (56.8%) and are more likely to be formally structured
than the industry overall. Product specialists are common, with just 16.2% of respondents saying their firm does
not have that function. At bank-owned firms that use product specialists, they are more likely to report solely to
the investment teams (51.4%) compared to the broader industry (26.3%). Most respondents viewed this function as
moderately successful within their firms.
Beyond capital raising and retention, how are bank-owned multi-product firms measuring performance? The top three
performance metrics were essentially tied:
1. Team collaboration
2. Strategic firm building
3. Activity
Multi-Product A
sset Managers – Bank-O
wned
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Multi-Product A
sset Managers – Bank-O
wned
The hiring outlook for the remainder of 2013 for bank owned multi-product firms seems moderately strong in the
United States, with 27% of respondents saying there firms were actively recruiting and 32.4% opportunistically
meeting candidates. These firms also seem to have a strong global presence and interest, with fewer respondents
saying their firm does not have a current presence or plan to expand in Asia, UK/Europe or the Middle East. Hiring
activity in this category across all of these geographies appears to be more robust than in the industry overall.
What is the highest level of education you have completed
Answer Options Response Percent Response Count
Bachelor's Degree 38.5% 20
Master's Degree (non MBA) 5.8% 3
MBA 51.9% 27
Ph.D. 3.8% 2
answered question 52
Did you change firms during the past 3 years?
Answer Options Response Percent Response Count
Yes 42.5% 17
No 57.5% 23
answered question 40
If yes, by what percentage did your total compensation change?
Answer Options Response Percent Response Count
Remained Flat 26.3% 5
Increased by 1% - 9% 10.5% 2
Increased by 10% - 19% 26.3% 5
Increased by 20% - 29% 15.8% 3
Increased by 30% - 39% 10.5% 2
Increased by 40%+ 0.0% 0
Decreased by 1% - 9% 5.3% 1
Decreased by 10% - 19% 0.0% 0
Decreased by 20% - 29% 0.0% 0
Decreased by 30% - 39% 0.0% 0
Decreased by 40%+ 5.3% 1
answered question 19
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 60
If you changed firms, were you offered a (check all that apply):
Answer Options Response Percent Response Count
Sign-on bonus 21.4% 3
Buy out of equity 14.3% 2
Make whole bonus (100% of anticipated bonus at previous firm) 7.1% 1
Minimum bonus floor (% of anticipated bonus at previous firm) 35.7% 5
Not applicable 42.9% 6
Other (please specify) 2
answered question 14
If you changed firms in the past 3 years, please rank your primary motivation(s) for change:Answered: 18
9.12
7.47
7.63
7.13
7.57
8.13
7.65
10.00
7.75
5.93
7.69
7.24
Management opportunity
Compensation
Firm Culture
Brand
Marketability of products
Layoffs or restructuring
Ability to have influence outside of fundraising
Level of value placed on marketing
People
Opportunity to grow/build the marketing effort
Greater opportunities for advancement
Firm's willingness to meet client expectataions
How would you characterize your current state of mind?
Answer Options Response Percent Response Count
Actively looking (unemployed) 5.3% 2
Actively looking (currently employed) 13.2% 5
Not looking but open to considering new opportunities if presented 68.4% 26
Not open to considering new opportunities 13.2% 5
Other (please specify) 0
answered question 38
Multi-Product A
sset Managers – Bank-O
wned
Heidrick & Struggles 61
Multi-Product A
sset Managers – Bank-O
wned
What is your view on the level of difficulty in raising capital today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 5.0% 2
Moderately more difficult 22.5% 9
Significantly more difficult 40.0% 16
About the same 15.0% 6
Moderately easier 10.0% 4
Significantly easier 7.5% 3
Other (please specify) 0
answered question 40
What is your view on the level of difficulty in retaining client assets today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 12.5% 5
Moderately more difficult 25.0% 10
Significantly more difficult 10.0% 4
About the same 45.0% 18
Moderately easier 7.5% 3
Significantly easier 0.0% 0
Other (please specify) 0
answered question 40
Percentage of inflows from new vs. existing investors
Firm Type% Inflows from New
Investors % Inflows from Existing
Investors
Multi-Product Asset Managers – Bank Owned 63.42 36.58
Capital raising levels per marketer
Firm Type Year Mean Median Range
# of marketers that raised zero capital
% of marketers that raised zero capital Notes
Multi-Product Asset Manager - Bank Owned
2012 400,285,714 250,000,000 0 - 2,000,000,000 2/28 7.14%
Multi-Product Asset Manager - Bank Owned
2013 *YTD
331,678,571 115,000,000 0 - 1,500,000,000 4/29 13.79% Minus 1 outlier citing $5bln
* YTD as of June 2013
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 62
What are your bonus expectations for 2013 compared to 2012?
Answer Options Response Percent Response Count
Increased by less than 10% 5.0% 2
Increased by 11% - 15% 12.5% 5
Increased by 16% - 20% 17.5% 7
Increased by 21% - 25% 5.0% 2
Increased by 26% - 30% 2.5% 1
Increased by 31% - 35% 0.0% 0
Increased by 36% - 40% 7.5% 3
Increased by greater than 40% 7.5% 3
Flat from my 2012 bonus 15.0% 6
Decreased by less than 10% 5.0% 2
Decreased by 11% - 15% 0.0% 0
Decreased by 16% - 20% 2.5% 1
Decreased by 21% - 25% 0.0% 0
Decreased by 26% - 30% 0.0% 0
Decreased by 31% - 35% 0.0% 0
Decreased by 36% - 40% 0.0% 0
Decreased by greater than 40% 0.0% 0
Still too early in the year to estimate 20.0% 8
Other (please specify) 0
answered question 40
What percentage of your cash bonus was deferred in 2012?
Answer Options Response Percent Response Count
Less than 10% 54.1% 20
10% - 7019% 13.5% 5
20% - 29% 16.2% 6
30% - 39% 8.1% 3
40% - 49% 2.7% 1
50% - 60% 0.0% 0
60% - 70% 5.4% 2
70%+ 0.0% 0
answered question 37
Multi-Product A
sset Managers – Bank-O
wned
Heidrick & Struggles 63
Multi-Product A
sset Managers – Bank-O
wned
What other components comprise your total compensation (check all that apply)??
Answer Options Response Percent Response Count
Stock options 43.5% 10
Participation in the funds 17.4% 4
Equity-like participation 43.5% 10
Sign on bonus 17.4% 4
Retention bonus 13.0% 3
Other (please specify) 4
answered question 23
Which option best characterizes your current bonus structure?
Answer Options Response Percent Response Count
Purely formulaic 2.6% 1
Loosely formulaic driven by metrics 15.8% 6
Purely Discretionary 31.6% 12
Part formula / part discretionary 50.0% 19
Other (please specify) 2
answered question 38
Which bonus structure do you prefer?
Answer Options Response Percent Response Count
Purely formulaic 17.9% 7
Loosely formulaic driven by metrics 17.9% 7
Purely Discretionary 7.7% 3
Part formula / part discretionary 48.7% 19
Agnostic 7.7% 3
Other (please specify) 0
answered question 39
How are bank owned multi-product asset managers structuring their distribution efforts?
Mean Median Range
# of sales/fundraising professionals 20.7 10 2 - 100
# of product specialists (for firms with product specialists)
11 7 2-60
# of client facing investor relations professionals 12.1 6 2 - 50
# of non - client facing client services professionals *
12.8 10 1-50
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 64
How is coverage among your current sales team (primarily) aligned?
Answer Options Response Percent Response Count
Geographically 56.8% 21
Client Channel 35.1% 13
Product 0.0% 0
No formal alignment 8.1% 3
Other (please specify) 6
answered question 37
Where do product specialists at your firm report in to?
Answer Options Response Percent Response Count
Investment team 51.4% 19
Sales team 16.2% 6
Dual Reporting to investment and sales teams 16.2% 6
Not applicable - my firm does not employ product specialists 16.2% 6
Other (please specify) 3
answered question 37
How successful has the product specialist role been within your current firm?Answered: 39
N/A - my firm does notemploy product specialists
56%
13%
10%
13%
5%
3%
Highly successful
Moderately successful
Neutral
Not very successful
Not at all successful
US: How would you best characterize your current firm’s hiring plans within *US* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 27.0% 10
Opportunistically meeting potential candidates 32.4% 12
Team will remain flat through year-end 35.1% 13
Currently reducing the size of the team 5.4% 2
Other (please specify) 3
answered question 37
Multi-Product A
sset Managers – Bank-O
wned
Heidrick & Struggles 65
Multi-Product A
sset Managers – Bank-O
wned
Asia: How would you best characterize your current firm’s hiring plans within *Asia* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 9.4% 3
Opportunistically meeting potential candidates 21.9% 7
Team will remain flat through year-end 40.6% 13
Currently reducing the size of the team 6.3% 2
No current presence or plans to expand in to Asia 21.9% 7
answered question 32
UK/Europe: How would you best characterize your current firm's hiring plans within *UK/European* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 12.5% 4
Opportunistically meeting potential candidates 18.8% 6
Team will remain flat through year-end 50.0% 16
Currently reducing the size of the team 3.1% 1
No current presence or plans to expand in the UK or Europe 15.6% 5
Other (please specify) 0
answered question 32
Middle East: How would you best characterize your current firm's hiring plans within *Middle Eastern* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 0.0% 0
Opportunistically meeting potential candidates 24.1% 7
Team will remain flat through year-end 44.8% 13
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in the Middle East 31.0% 9
Other (please specify) 1
answered question 29
In your view, what is the most effective strategy for a firm to expand its marketing effort overseas?
Answer Options Response Percent Response Count
Exporting an existing team member overseas 21.1% 8
Hiring an outside candidate within the local region 76.3% 29
Cover the region from the US 0.0% 0
Not applicable: my current firm does not have a marketing presence outside of the US
2.6% 1
Other (please specify) 0
answered question 38
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 66
How does your firm typically recruit sales & client services professionals? (Check all that apply)
Answer Options Response Percent Response Count
Leveraging industry network 68.4% 26
Sourcing investors 7.9% 3
LinkedIn 31.6% 12
Retained executive search 60.5% 23
Contingency executive search 26.3% 10
Professional associations 18.4% 7
Employee referrals 76.3% 29
Internal recruiting function 57.9% 22
Other (please specify) 1
answered question 38
Has your firm used retained search in the past 2 years to hire sales & client services professionals?
Answer Options Response Percent Response Count
Yes 50.0% 19
No 21.1% 8
I don't know 28.9% 11
answered question 38
Multi-Product A
sset Managers – Bank-O
wned
Heidrick & Struggles 67
Multi-Product A
sset Managers – Bank-O
wned
Multi-Product Asset Manager – Bank-Owned: Demographics
What is your current job title?
Answer Options Response Percent Response Count
Associate 0.0% 0
Senior Associate 0.0% 0
Vice President 15.6% 7
Senior Vice President 17.8% 8
Director/Principal 26.7% 12
Managing Director (individual contributor) 13.3% 6
Managing Director (management role) 26.7% 12
Partner 0.0% 0
N/A - Not currently employed 0.0% 0
Other (please specify) 11
answered question 45
How many years of total work experience do you have?
Answer Options Response Percent Response Count
5 - 10 3.8% 2
11 - 15 9.6% 5
16 - 20 36.5% 19
21 - 25 21.2% 11
26+ 28.8% 15
answered question 52
How many years of asset management distribution experience do you have?
Answer Options Response Percent Response Count
5 - 10 19.2% 10
11 - 15 28.8% 15
16 - 20 32.7% 17
21 - 25 15.4% 8
26+ 3.8% 2
answered question 52
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 68
Where do you work?
Answer Options Response Percent Response Count
New York 48.9% 22
Connecticut 2.2% 1
Boston 13.3% 6
Chicago 17.8% 8
San Francisco 4.4% 2
Los Angeles 11.1% 5
Minneapolis 0.0% 0
Philadelphia 2.2% 1
Miami 0.0% 0
Houston 0.0% 0
Dallas 0.0% 0
Washington D.C. 0.0% 0
Other (please specify) 9
answered question 45
Which investment products are offered by your current firm (check all that apply)?
Answer Options Response Percent Response Count
Long Only Equity 80.8% 42
Long Only Fixed Income 80.8% 42
Hedge Funds 61.5% 32
Private Equity 36.5% 19
Hedge Fund of Funds 50.0% 26
Private Equity Fund of Funds 34.6% 18
Real Estate 57.7% 30
Commodities 40.4% 21
Infrastructure 38.5% 20
Other (please specify) 8
answered question 52
How would you characterize the primary focus of your current role?
Answer Options Response Percent Response Count
Sales / Fundraising 52.1% 25
Investor Relations / Client Service (client facing) 4.2% 2
Investor Relations / Client Service (non client facing / support) 0.0% 0
Hybrid Sales & Investor Relations 12.5% 6
Product Specialist 4.2% 2
Consultant Relations 27.1% 13
Other (please specify) 9
answered question 48
Multi-Product A
sset Managers – Bank-O
wned
Heidrick & Struggles 69
Multi-Product A
sset Managers – Bank-O
wned
What are the total assets under management of your current firm?
Answer Options Response Percent Response Count
<$200mln 2.0% 1
$200mln - $500mln 0.0% 0
$500mln - $1bln 0.0% 0
$1bln 2.0% 1
$2bln 0.0% 0
$3bln 0.0% 0
$4bln 0.0% 0
$5bln 2.0% 1
$6bln 0.0% 0
$7bln 0.0% 0
$8bln 0.0% 0
$9bln 0.0% 0
$10bln 2.0% 1
$11bln 0.0% 0
$12bln 0.0% 0
$13bln 0.0% 0
$14bln 0.0% 0
$15bln 0.0% 0
$16bln 0.0% 0
$17bln 0.0% 0
$18bln 0.0% 0
$19bln 0.0% 0
$20bln - $29bln 3.9% 2
$30bln - $39bln 5.9% 3
$40bln - $49bln 5.9% 3
$50bln - $59bln 2.0% 1
$60bln+ 74.5% 38
Other (please specify) 1
answered question 51
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 70
Hedge Funds
Midway through 2013, hedge funds remain an active recruiting market for distribution professionals, although the
number of positions open globally appears smaller than in the broader asset management industry. For example,
25% of hedge fund employees who participated in our survey reported that their firms were either actively looking or
opportunistically meeting potential candidates in the United States, compared to 40.9% of survey participants overall.
This disparity is likely due to smaller assets under management and team size at hedge fund managers, significant
talent movement over the past several years and, possibly, ongoing performance challenges.
While fundraising remains a major challenge for many hedge funds, inflows in 2013 are looking more positive on
average than they were in 2012, even taking into account some early summer performance issues that caused many
investors to pause and further extend an already lengthy sales cycle. The shift of inflows to the larger hedge funds has
only intensified this year as we have witnessed a flight to safety and continued migration out of fund of funds, leaving
many smaller or nascent funds in a difficult situation. Several marketers reported larger ticket sizes from public funds in
2013 but cited fee pressure from these investors as a challenge. In light of the frequency of movement during the past
three years and the number of firms revamping their distribution efforts, a number of respondents said fundraising
may be up in 2013 because they have gained traction this year after having moved into their current roles and focused
on building infrastructure and momentum in 2011 and 2012.
When we conduct marketing and investor relations searches for hedge fund clients, many hiring managers express the
desire for candidates with an MBA or CFA; yet only 44.7% of respondents have an MBA and only 13.6% have a CFA.
Movement among hedge fund distribution professionals during the past three years was high, with 60% of
respondents reporting they changed firms during that period. Respondents in this category ranked the desire to
build and grow a marketing effort as the top motivator for change; greater opportunities for advancement and
compensation ranked second and third respectively. In contrast, respondents at other types of asset managers ranked
culture and people more highly as reasons to change firms.
We see this “build” characteristic in many of our candidates, particularly the most talented and successful ones. As the
larger hedge funds continue to expand their teams, we often hear from candidates that “it’s getting crowded” and
they feel like they have less ability to build, create, and influence. It pays for hedge fund managers to be mindful of
this motivating character trait and to provide those who possess it with suitable opportunities wherever possible—for
example, by leveraging their insight into new product development or assigning a team captain to a new product.
We found that hedge fund marketing and investor relations professionals have an attitude toward changing firms that
is similar to their broader industry peers, with most respondents (53.5%) describing themselves as “not looking but
open to considering new opportunities.” We took a closer look at how movement affected compensation and found
that 56.2% of respondents who reported moving within the past three years saw an increase in total compensation,
with the top 10.9% enjoying a 40%+ increase. About one-quarter saw their compensation remain flat and 15.1%
actually saw a decrease. When joining a new firm, 50% received a minimum bonus floor and 15% a make-whole bonus,
above the norm compared to their asset management peers in the industry as a whole.
Nearly 62% of respondents said capital raising is more difficult today compared to three years ago, with 10.8% viewing
it the same and 17.6% as easier. Regarding the retention of capital, 54% view it as more difficult, 35.1% as about the
same and 10.9% as easier. Participants reported an average of 59.7% of inflows coming from new investors and 40.3%
from existing investors. The median amount of capital raised YTD in 2013 is $150 million per marketer, compared to
$100 million in 2012.
Hedge Funds
Hedge Funds
Heidrick & Struggles 71
Bonus expectations are quite mixed, with 56.2% of respondents expecting an increase in 2013, 20.5% saying it’s
too early in the year to tell, 19.2% expecting bonuses to remain flat and 4.1% expecting a decrease. The majority
of respondents (65.3%) are paid on a purely discretionary basis (compared to 44.4% across the broader asset
management industry) but only 21% prefer that structure. Nearly half prefer to be paid on a part formula/part
discretionary basis—something firms might keep in mind when trying to attract talent. Deferred compensation levels
are low among hedge funds, with 65.8% of respondents having less than 10% of their 2012 cash bonus deferred.
Hedge funds differ from the rest of the asset management industry in that most firms (at least 71.2%) do not employ
product specialists and many do not employ non-client-facing investor relations professionals. Additionally, a higher
percentage of respondents in this category described their roles as hybrid sales and investor relations—different
from traditional asset management, which tends to be much more segmented. Among firms that do employ product
specialists, the majority report to the sales team and the role is viewed as successful within the firm.
In measuring a distribution professional’s individual performance beyond capital raising and retention, hedge funds
view fund performance as more important than other asset management firms. The top four performance metrics are:
1. Strategic/firm building
2. Fund performance
3. Team collaboration
4. Activity
Finally, the global hiring outlook for hedge fund distribution seems less robust than it is in the asset management
industry overall. As noted above, only 25% of respondents working at hedge funds said their firms were actively
recruiting or opportunistically meeting candidates in the United States, compared with 40.9% for the entire industry.
Only 6.1% said their firms were actively recruiting or opportunistically meeting candidates in Asia, compared to 24.1%
of the industry overall, and 66.2% said their firms have no presence or plans to expand in Asia, compared to the
broader industry at 48.1%. In the UK/Europe we are seeing the same trend, with just 12.4% saying their firms were
actively recruiting or opportunistically meeting candidates compared with an industry average of 21%. In Europe,
hedge funds face the additional pressure of an increasingly challenging regulatory environment. In the Middle East,
no respondents said their firms were actively interviewing and just 4.8% reported they were opportunistically meeting
candidates, while 11.4% of asset managers overall were actively interviewing or opportunistically meeting candidates
in that region.
The overall asset management industry, with a deeper presence outside the U.S. than most hedge funds, also seems
more confident that hiring an outside candidate from the local region is the most effective way to expand marketing
efforts overseas. (In subsequent studies, we will look at the Americas more broadly.)
When recruiting sales and investor relations talent, hedge fund respondents reported only slightly lower rates (46.3%)
of partnering with retained executive search firms than the broader asset management industry (51.9%).
There are so many nuances and variables that affect hedge fund distribution efforts—strategy, performance, assets
under management, ownership structure, sophistication of the sales and investor relations team, culture, etc. We hope
to explore them further in future reports.
Hedge Funds
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 72
What is the highest level of education you have completed
Answer Options Response Percent Response Count
Bachelor's Degree 47.9% 45
Master's Degree (non MBA) 6.4% 6
MBA 44.7% 42
Ph.D. 1.1% 1
answered question 94
Did you change firms during the past 3 years?
Answer Options Response Percent Response Count
Yes 60.0% 45
No 40.0% 30
answered question 75
If yes, by what percentage did your total compensation change?
Answer Options Response Percent Response Count
Remained Flat 26.1% 12
Increased by 1% - 9% 6.5% 3
Increased by 10% - 19% 6.5% 3
Increased by 20% - 29% 21.7% 10
Increased by 30% - 39% 13.0% 6
Increased by 40%+ 10.9% 5
Decreased by 1% - 9% 0.0% 0
Decreased by 10% - 19% 4.3% 2
Decreased by 20% - 29% 4.3% 2
Decreased by 30% - 39% 4.3% 2
Decreased by 40%+ 2.2% 1
answered question 46
If you changed firms, were you offered a (check all that apply):
Answer Options Response Percent Response Count
Sign-on bonus 25.0% 10
Buy out of equity 12.5% 5
Make whole bonus (100% of anticipated bonus at previous firm) 15.0% 6
Minimum bonus floor (% of anticipated bonus at previous firm) 50.0% 20
Not applicable 30.0% 12
Other (please specify) 1
answered question 40
Hedge Funds
Heidrick & Struggles 73
If you changed firms in the past 3 years, please rank your primary motivation(s) for change:Answered: 44
8.90
6.83
8.80
7.13
6.86
6.34
8.88
9.92
9.03
6.18
8.49
6.34
Management opportunity
Compensation
Firm Culture
Brand
Marketability of products
Layoffs or restructuring
Ability to have influence outside of fundraising
Level of value placed on marketing
People
Opportunity to grow/build the marketing effort
Greater opportunities for advancement
Firm's willingness to meet client expectataions
How would you characterize your current state of mind?
Answer Options Response Percent Response Count
Actively looking (unemployed) 2.8% 2
Actively looking (currently employed) 15.5% 11
Not looking but open to considering new opportunities if presented 53.5% 38
Not open to considering new opportunities 28.2% 20
Other (please specify) 2
answered question 71
What is your view on the level of difficulty in raising capital today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 10.8% 8
Moderately more difficult 29.7% 22
Significantly more difficult 31.1% 23
About the same 10.8% 8
Moderately easier 14.9% 11
Significantly easier 2.7% 2
Other (please specify) 1
answered question 74
Hedge Funds
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 74
What is your view on the level of difficulty in retaining client assets today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 16.2% 12
Moderately more difficult 21.6% 16
Significantly more difficult 16.2% 12
About the same 35.1% 26
Moderately easier 9.5% 7
Significantly easier 1.4% 1
Other (please specify) 1
answered question 74
Capital raising levels per marketer
Firm Type Year Mean Median Range
# of marketers that raised zero capital
% of marketers that raised zero capital Notes
Hedge Fund 2012 $302,525,000 $100,000,000 $0 - $5,000,000,000
12/61 19.67%
Hedge Fund 2013 *YTD
$315,546,875 $150,000,000 $0 - $2,000,000,000
9/64 14.06%
* YTD as of June 2013
What are your bonus expectations for 2013 compared to 2012?
Answer Options Response Percent Response Count
Increased by less than 10% 11.0% 8
Increased by 11% - 15% 9.6% 7
Increased by 16% - 20% 4.1% 3
Increased by 21% - 25% 12.3% 9
Increased by 26% - 30% 1.4% 1
Increased by 31% - 35% 4.1% 3
Increased by 36% - 40% 8.2% 6
Increased by greater than 40% 5.5% 4
Flat from my 2012 bonus 19.2% 14
Decreased by less than 10% 0.0% 0
Decreased by 11% - 15% 0.0% 0
Decreased by 16% - 20% 0.0% 0
Decreased by 21% - 25% 0.0% 0
Decreased by 26% - 30% 0.0% 0
Decreased by 31% - 35% 1.4% 1
Decreased by 36% - 40% 0.0% 0
Decreased by greater than 40% 2.7% 2
Still too early in the year to estimate 20.5% 15
Other (please specify) 3
answered question 73
Hedge Funds
Heidrick & Struggles 75
What percentage of your cash bonus was deferred in 2012?
Answer Options Response Percent Response Count
Less than 10% 65.8% 48
10% - $19% 8.2% 6
20% - 29% 16.4% 12
30% - 39% 4.1% 3
40% - 49% 1.4% 1
50% - 60% 4.1% 3
60% - 70% 0.0% 0
70%+ 0.0% 0
answered question 73
What other components comprise your total compensation (check all that apply)??
Answer Options Response Percent Response Count
Stock options 10.3% 3
Participation in the funds 41.4% 12
Equity-like participation 37.9% 11
Sign on bonus 13.8% 4
Retention bonus 6.9% 2
Other (please specify) 4
answered question 29
Which option best characterizes your current bonus structure?
Answer Options Response Percent Response Count
Purely formulaic 5.6% 4
Loosely formulaic driven by metrics 6.9% 5
Purely Discretionary 65.3% 47
Part formula / part discretionary 22.2% 16
Other (please specify) 2
answered question 72
Which bonus structure do you prefer?
Answer Options Response Percent Response Count
Purely formulaic 5.6% 4
Loosely formulaic driven by metrics 18.3% 13
Purely Discretionary 21.1% 15
Part formula / part discretionary 47.9% 34
Agnostic 7.0% 5
Other (please specify) 1
answered question 71
Hedge Funds
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 76
How are hedge funds structuring their distribution teams?Mean Median Range
# of sales/fundraising professionals 3.7 2 1 - 25
# of product specialists (for firms with product specialists) 1
1.7 1 1-8
# of client facing investor relations professionals 2 3.1 2 1-16
# of non - client facing client services professionals 3 3.3 2 1-12
(1) most hedge funds do not employ product specialists
(2) there is significant crossover with sales/IR combined in hybrid roles
(3) 26% of respondents said their firms do not employ any non-client-facing client services professionals
How is coverage among your current sales team (primarily) aligned?
Answer Options Response Percent Response Count
Geographically 32.9% 24
Client Channel 13.7% 10
Product 4.1% 3
No formal alignment 49.3% 36
Other (please specify) 3
answered question 73
Where do product specialists at your firm report in to?
Answer Options Response Percent Response Count
Investment team 4.1% 3
Sales team 17.8% 13
Dual Reporting to investment and sales teams 6.8% 5
Not applicable - my firm does not employ product specialists 71.2% 52
Other (please specify) 2
answered question 73
Hedge Funds
Heidrick & Struggles 77
How successful has the product specialist been within your current firm?Answered: 72
N/A - my firm does notemploy product specialists
11%
13%
71%
0%
1%
4%
Highly successful
Moderately successful
Neutral
Not very successful
Not at all successful
US: How would you best characterize your current firm’s hiring plans within *US* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 10.3% 7
Opportunistically meeting potential candidates 14.7% 10
Team will remain flat through year-end 67.6% 46
Currently reducing the size of the team 7.4% 5
Other (please specify) 1
answered question 68
Asia: How would you best characterize your current firm’s hiring plans within *Asia* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 1.5% 1
Opportunistically meeting potential candidates 4.6% 3
Team will remain flat through year-end 26.2% 17
Currently reducing the size of the team 1.5% 1
No current presence or plans to expand in to Asia 66.2% 43
answered question 65
UK/Europe: How would you best characterize your current firm's hiring plans within *UK/European* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 6.2% 4
Opportunistically meeting potential candidates 6.2% 4
Team will remain flat through year-end 32.3% 21
Currently reducing the size of the team 1.5% 1
No current presence or plans to expand in the UK or Europe 53.8% 35
Other (please specify) 1
answered question 65
Hedge Funds
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 78
Middle East: How would you best characterize your current firm's hiring plans within *Middle Eastern* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 0.0% 0
Opportunistically meeting potential candidates 4.8% 3
Team will remain flat through year-end 20.6% 13
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in the Middle East 74.6% 47
Other (please specify) 1
answered question 63
In your view, what is the most effective strategy for a firm to expand its marketing effort overseas?
Answer Options Response Percent Response Count
Exporting an existing team member overseas 16.7% 11
Hiring an outside candidate within the local region 37.9% 25
Cover the region from the US 21.2% 14
Not applicable: my current firm does not have a marketing presence outside of the US
24.2% 16
Other (please specify) 5
answered question 66
How does your firm typically recruit sales & client services professionals? (check all that apply)
Answer Options Response Percent Response Count
Leveraging industry network 65.7% 44
Sourcing investors 16.4% 11
LinkedIn 6.0% 4
Retained executive search 46.3% 31
Contingency executive search 20.9% 14
Professional associations 10.4% 7
Employee referrals 53.7% 36
Internal recruiting function 19.4% 13
Other (please specify) 0
answered question 160
Has your firm used retained search in the past 2 years to hire sales & client services professionals?
Answer Options Response Percent Response Count
Yes 37.7% 26
No 55.1% 38
I don't know 7.2% 5
answered question 69
Hedge Funds
Heidrick & Struggles 79
Hedge Funds: Demographics
What is your current job title?
Answer Options Response Percent Response Count
Associate 0.0% 0
Senior Associate 1.1% 1
Vice President 6.7% 6
Senior Vice President 6.7% 6
Director/Principal 31.5% 28
Managing Director (individual contributor) 15.7% 14
Managing Director (management role) 23.6% 21
Partner 11.2% 10
N/A - Not currently employed 3.4% 3
Other (please specify) 8
answered question 89
How many years of total work experience do you have?
Answer Options Response Percent Response Count
5 - 10 6.3% 6
11 - 15 30.5% 29
16 - 20 26.3% 25
21 - 25 25.3% 24
26+ 11.6% 11
answered question 95
How many years of asset management distribution experience do you have?
Answer Options Response Percent Response Count
5 - 10 35.1% 33
11 - 15 38.3% 36
16 - 20 17.0% 16
21 - 25 9.6% 9
26+ 0.0% 0
answered question 94
Hedge Funds
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 80
Where do you work?
Answer Options Response Percent Response Count
New York 72.8% 67
Connecticut 10.9% 10
Boston 1.1% 1
Chicago 6.5% 6
San Francisco 4.3% 4
Los Angeles 2.2% 2
Minneapolis 1.1% 1
Philadelphia 0.0% 0
Miami 0.0% 0
Houston 0.0% 0
Dallas 1.1% 1
Washington D.C. 0.0% 0
Other (please specify) 3
answered question 92
Which investment products are offered by your current firm (check all that apply)?
Answer Options Response Percent Response Count
Long Only Equity 8.7% 8
Long Only Fixed Income 10.9% 10
Hedge Funds 96.7% 89
Private Equity 18.5% 17
Hedge Fund of Funds 8.7% 8
Private Equity Fund of Funds 1.1% 1
Real Estate 9.8% 9
Commodities 6.5% 6
Infrastructure 1.1% 1
Other (please specify) 5
answered question 92
How would you characterize the primary focus of your current role?
Answer Options Response Percent Response Count
Sales / Fundraising 45.7% 42
Investor Relations / Client Service (client facing) 12.0% 11
Investor Relations / Client Service (non client facing / support) 0.0% 0
Hybrid Sales & Investor Relations 35.9% 33
Product Specialist 2.2% 2
Consultant Relations 4.3% 4
Other (please specify) 6
answered question 92
Hedge Funds
Heidrick & Struggles 81
If your firm is a hedge fund, what is its primary investment strategy?
Answer Options Response Percent Response Count
Long short equity 23.3% 21
Long bias 1.1% 1
Credit 24.4% 22
Event driven 14.4% 13
Arbitrage 1.1% 1
Global macro 13.3% 12
Relative Value 3.3% 3
CTA/Managed futures 4.4% 4
Multi-strategy 14.4% 13
Other (please specify) 10
answered question 90
Hedge Funds
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 82
What are the total assets under management of your current firm?
Answer Options Response Percent Response Count
<$200mln 9.6% 9
$200mln - $500mln 16.0% 15
$500mln - $1bln 3.2% 3
$1bln 8.5% 8
$2bln 8.5% 8
$3bln 6.4% 6
$4bln 4.3% 4
$5bln 4.3% 4
$6bln 3.2% 3
$7bln 6.4% 6
$8bln 0.0% 0
$9bln 2.1% 2
$10bln 5.3% 5
$11bln 1.1% 1
$12bln 7.4% 7
$13bln 1.1% 1
$14bln 0.0% 0
$15bln 2.1% 2
$16bln 2.1% 2
$17bln 0.0% 0
$18bln 2.1% 2
$19bln 1.1% 1
$20bln - $29bln 2.1% 2
$30bln - $39bln 1.1% 1
$40bln - $49bln 1.1% 1
$50bln - $59bln 0.0% 0
$60bln+ 2.1% 2
Other (please specify) 0
answered question 94
Hedge Funds
Heidrick & Struggles 83
Private Equity
The private equity industry has experienced a transformation in fundraising and investor relations. Many firms, whose
last fundraising efforts took place pre-2008, have recently seen or are about to experience a seismic shift in their
approach to raising assets, since it now takes longer to raise funds and pre-fundraising is a much more important part
of the process. Fewer clients are “re-upping” and many are allocating less funding than in recent years. As a result,
there is a need to diversify into different channels and geographies to meet fundraising targets and reduce the risk of
dependency on one or two client channels for future fundraises.
As a result, it is now common practice for private equity firms to provide a high level of service to existing clients,
providing more contact, portfolio information and greater access to the firm’s senior management team. We have
therefore seen client relationship management become fundamentally more important in the last several years.
Findings from our survey of distribution professionals suggest that private equity firms are hiring talent to cope
with the more complex nature of fundraising and investor relations. As the demand for talent increases, we would
consequently expect salaries to rise as well.
(Please note: Throughout this section we refer to the different types of client team professionals at private equity
firms—marketers, business developers, fundraisers, client relations managers—as investor relations (IR) professionals.)
A relatively small sample of 29 investor relations professionals employed by private equity firms responded to our
survey. They range from vice president to partner. Firm assets range from $1 billion to more than $60 billion. The firms
are located across the United States, with a large proportion headquartered in New York. Most of them prefer to hire
investor relations professionals with advanced degrees, and two-thirds of respondents reported having advanced
degrees.
Despite lengthy private equity fundraising cycles, steady economic recovery and more emphasis on long-term
compensation, 40% of our respondents changed firms during the past three years, supporting our view that there
is a high level of demand for investor relations professionals. Almost 60% of those who moved had an increase in
compensation, with 25% of them receiving an increase of 30% to 40%. For one third of those who moved, however,
compensation remained flat. This discrepancy is likely explained by the fact that some of the respondents were actively
looking to move or were unemployed, while others were “poached” by their new employer.
Of those who changed firms, almost 60% received some type of sign-on bonus. Approximately 28% were offered
minimum bonus floors while none received absolute guarantees.
When considering the reasons for changing jobs, the top motivator is people, followed by opportunity to grow and
build the marketing function in second place and layoffs/restructuring coming in third. A very close fourth on the list
of motivators is culture, which arguably can be tied to the people category, further strengthening the notion that a
firm’s culture drives motivation. Other high-ranking motivators include marketability of products and the level of value
placed on the marketing function, both of which we have found to be significant factors when IR professionals are
deciding which firm to join. Although many people assume that compensation is a strong motivator, private equity
respondents ranked it sixth.
Apart from fundraising and client retention, the performance metrics that IR professionals said are most commonly
used are team collaboration, firm profitability and consultant ratings. These findings magnify the importance of culture
and indicate the growing importance of actively covering consultants.
Private Equity
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 84
A startling 71% of respondents said they are opportunistic when it comes to considering other career opportunities
and approximately 20% said they were actively looking while employed. While our small sample size may have skewed
the data, we have found that people are generally open to talking about new opportunities.
About 48% of respondents think it is more difficult to raise capital than it was three years ago, while 24% think it’s
easier and 28% think it is about the same. The perceived difficulty of raising assets may be a significant reason why so
many respondents changed firms in the past three years and why so many are open to considering career moves.
Respondents said 60% of capital inflows are coming from new investors and 40% from current clients. While the figures
may vary significantly depending on fund performance, on average 40% is a large proportion and demonstrates the
importance of providing high-level client service during non-fundraising periods.
Assets raised per IR professional appear to be up significantly from 2012 in the first six months of 2013. This may be
explained by a number of factors: more investors are putting money to work in private equity (a shift in asset classes);
more private equity firms are raising money this year; private equity firms have more funds in the market. There is also
the possibility that institutional investors have greater liquidity than in previous years. It should be noted that, while
the mean level of assets raised has increased, a higher percentage of IR professionals have raised zero capital in 2013
compared to 2012. While some firms may not be actively fundraising, the more likely explanation is that more funds are
under-performing.
Compensation in 2013 appears to be up from 2012, with 65% of respondents seeing an increase and 35% reporting
an increase of 20% or more. Approximately 80% of respondents said less than 10% of their cash compensation was
deferred and 10% had 20-29% of their cash compensation deferred.
Approximately 50% of respondents said they receive carried interest. Carry, as a percentage of total compensation,
can vary widely, from 0%-75%, with higher percentages noted among more senior level professionals. The typical
range is somewhere between 3%-40%. Although we know that an increasingly higher proportion of investor relations
professionals are receiving carried interest, it will be interesting to see how this trend evolves in years to come,
particularly as firms expand their product offerings and these programs become more complex to manage.
Slightly more than 50% of respondents receive equity participation or stock options. About 45% said their bonus
structure is part formulaic/part discretionary, while 35% have a purely discretionary structure and just 10% have a
purely formulaic structure. At the same time, 45% of respondents favor a part formulaic/part discretionary bonus
structure, which suggests that IR professionals want to be rewarded for performance but also for harder-to-quantify
factors such as training, building an IR function, branding, improving marketing materials, innovative ideas for client
relationship management and extensive premarketing campaigns.
Our survey suggests that IR teams are clearly split between geographical coverage models and no formal alignment.
Only 8% of respondents said IR teams are aligned by client channel, distinguishing private equity firms from typical
asset managers and hedge funds, where more teams are aligned by client channel.
About 40% of respondents said their firms have product specialists, half of whom report to the investment teams and
half to the sales teams. Of those who work at firms with product specialists, approximately 50% think the product
specialist role is moderately successful and approximately 20% think it is highly successful. Almost 30% think the
product specialist role is neither successful nor unsuccessful, suggesting that some IR professionals are unfamiliar with
the product specialist role or that it may be new to their firms.
Private Equity
Heidrick & Struggles 85
Private Equity
Half of the respondents said their firms are actively recruiting or are open to meeting with potential hires in the United
States, while the other half said they are not looking to recruit additional members to the IR teams. On the international
front, there seems to be a relatively low level of active recruiting currently taking place in Asia and Europe and it looks
like most firms are going to maintain their existing team size. Two-thirds of respondents said the best way to handle
overseas private equity investor relations coverage is to hire an outside candidate within the local region, while just
under one-third said the most effective strategy is to export an existing team member overseas.
In summary, there appears to be increased demand for investor relations talent in the U.S. as private equity firms have
increasingly realized the importance of the investor relations function. This conclusion is supported by the fact that
40% of respondents changed firms in the past three years and that compensation is trending up. And at a time when
demand for talent is high, investor relations professionals are very open to considering career moves and exploring
employment opportunities.
What is the highest level of education you have completed?
Answer Options Response Percent Response Count
Bachelor's Degree 34.5% 10
Master's Degree (non MBA) 20.7% 6
MBA 34.5% 10
Ph.D. 10.3% 3
answered question 29
Did you change firms during the past 3 years?
Answer Options Response Percent Response Count
Yes 40.0% 10
No 60.0% 15
answered question 25
If yes, by what percentage did your total compensation change?
Answer Options Response Percent Response Count
Remained Flat 33.3% 4
Increased by 1% - 9% 25.0% 3
Increased by 10% - 19% 8.3% 1
Increased by 20% - 29% 0.0% 0
Increased by 30% - 39% 16.7% 2
Increased by 40%+ 8.3% 1
Decreased by 1% - 9% 0.0% 0
Decreased by 10% - 19% 0.0% 0
Decreased by 20% - 29% 0.0% 0
Decreased by 30% - 39% 0.0% 0
Decreased by 40%+ 8.3% 1
answered question 12
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 86
If you changed firms, were you offered a (check all that apply):
Answer Options Response Percent Response Count
Sign-on bonus 57.1% 4
Buy out of equity 14.3% 1
Make whole bonus (100% of anticipated bonus at previous firm) 0.0% 0
Minimum bonus floor (% of anticipated bonus at previous firm) 28.6% 2
Not applicable 28.6% 2
Other (please specify) 0
answered question 7
If you changed firms in the past 3 years, please rank your primary motivation(s) for change:Answered: 9
8.14
5.20
9.29
9.60
7.43
8.00
10.00
9.88
6.57
3.83
8.86
7.43
Management opportunity
Compensation
Firm Culture
Brand
Marketability of products
Layoffs or restructuring
Ability to have influence outside of fundraising
Level of value placed on marketing
People
Opportunity to grow/build the marketing effort
Greater opportunities for advancement
Firm's willingness to meet client expectataions
How would you characterize your current state of mind?
Answer Options Response Percent Response Count
Actively looking (unemployed) 0.0% 0
Actively looking (currently employed) 19.0% 4
Not looking but open to considering new opportunities if presented 71.4% 15
Not open to considering new opportunities 9.5% 2
Other (please specify) 4
answered question 21
Private Equity
Heidrick & Struggles 87
What is your view on the level of difficulty in raising capital today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 8.0% 2
Moderately more difficult 16.0% 4
Significantly more difficult 24.0% 6
About the same 28.0% 7
Moderately easier 24.0% 6
Significantly easier 0.0% 0
Other (please specify) 1
answered question 25
What is your view on the level of difficulty in retaining client assets today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 8.3% 2
Moderately more difficult 20.8% 5
Significantly more difficult 16.7% 4
About the same 50.0% 12
Moderately easier 4.2% 1
Significantly easier 0.0% 0
Other (please specify) 1
answered question 24
Percentage of inflows from new vs. existing investors
Firm Type% Inflows from New
Investors % Inflows from Existing
Investors
Private Equity 59.55 40.45
Capital raising levels per marketer
Firm Type Year Mean Median Range
# of marketers that raised zero capital
% of marketers that raised zero capital Notes
Private Equity 2012 $335,000,000 $115,000,000 $0 - $800,000,000 3/15 20.00% Minus 1 outlier citing 4bln
Private Equity 2013 *YTD
$725,166,666 $275,000,000 $0 - $5,000,000,000
5/18 27.77% Four marketers up over $1bln
* YTD as of June 2013
Private Equity
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 88
What are your bonus expectations for 2013 compared to 2012?
Answer Options Response Percent Response Count
Increased by less than 10% 10.0% 2
Increased by 11% - 15% 10.0% 2
Increased by 16% - 20% 10.0% 2
Increased by 21% - 25% 15.0% 3
Increased by 26% - 30% 5.0% 1
Increased by 31% - 35% 0.0% 0
Increased by 36% - 40% 10.0% 2
Increased by greater than 40% 5.0% 1
Flat from my 2012 bonus 20.0% 4
Decreased by less than 10% 0.0% 0
Decreased by 11% - 15% 0.0% 0
Decreased by 16% - 20% 0.0% 0
Decreased by 21% - 25% 0.0% 0
Decreased by 26% - 30% 0.0% 0
Decreased by 31% - 35% 0.0% 0
Decreased by 36% - 40% 0.0% 0
Decreased by greater than 40% 0.0% 0
Still too early in the year to estimate 15.0% 3
Other (please specify) 0
answered question 20
What percentage of your cash bonus was deferred in 2012?
Answer Options Response Percent Response Count
Less than 10% 81.8% 18
10% - 19% 4.5% 1
20% - 29% 9.1% 2
30% - 39% 0.0% 0
40% - 49% 4.5% 1
50% - 60% 0.0% 0
60% - 70% 0.0% 0
70%+ 0.0% 0
answered question 22
Private Equity
Heidrick & Struggles 89
What other components comprise your total compensation (check all that apply)??
Answer Options Response Percent Response Count
Stock options 23.1% 3
Participation in the funds 76.9% 10
Equity-like participation 30.8% 4
Sign on bonus 7.7% 1
Retention bonus 7.7% 1
Other (please specify) 0
answered question 13
Which option best characterizes your current bonus structure?
Answer Options Response Percent Response Count
Purely formulaic 10.0% 2
Loosely formulaic driven by metrics 10.0% 2
Purely Discretionary 35.0% 7
Part formula / part discretionary 45.0% 9
Other (please specify) 0
answered question 20
Which bonus structure do you prefer?
Answer Options Response Percent Response Count
Purely formulaic 15.0% 3
Loosely formulaic driven by metrics 5.0% 1
Purely Discretionary 20.0% 4
Part formula / part discretionary 45.0% 9
Agnostic 15.0% 3
Other (please specify) 1
answered question 20
How are private equity firms structuring their distribution efforts?Mean Median Range
# of sales/fundraising professionals (1) 7.2 4 1-20
# of product specialists (for firms with product specialists)
6.2 4 3-25
# of client facing investor relations professionals 5.5 4 1-22
# of non - client facing client services professionals (2)
8.3 5 1 - 48
(1) Not counting one outlier who cited 50 sales professionals
(2) Not counting two outliers who cited 150 and 275 non-client facing client services professionals
Private Equity
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 90
How is coverage among your current sales team (primarily) aligned?
Answer Options Response Percent Response Count
Geographically 48.0% 12
Client Channel 8.0% 2
Product 0.0% 0
No formal alignment 44.0% 11
Other (please specify) 1
answered question 25
Where do product specialists at your firm report in to?
Answer Options Response Percent Response Count
Investment team 20.8% 5
Sales team 20.8% 5
Dual Reporting to investment and sales teams 8.3% 2
Not applicable - my firm does not employ product specialists 50.0% 12
Other (please specify) 1
answered question 24
How successful has the product specialist been within your current firm?Answered: 22
N/A - my firm does notemploy product specialists
23%
14%
45%
0%
0%
18%
Highly successful
Moderately successful
Neutral
Not very successful
Not at all successful
US: How would you best characterize your current firm’s hiring plans within *US* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 20.0% 4
Opportunistically meeting potential candidates 30.0% 6
Team will remain flat through year-end 50.0% 10
Currently reducing the size of the team 0.0% 0
Other (please specify) 0
answered question 20
Private Equity
Heidrick & Struggles 91
Asia: How would you best characterize your current firm’s hiring plans within *Asia* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 6.3% 1
Opportunistically meeting potential candidates 12.5% 2
Team will remain flat through year-end 31.3% 5
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in to Asia 50.0% 8
answered question 16
UK/Europe: How would you best characterize your current firm's hiring plans within *UK/European* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 5.6% 1
Opportunistically meeting potential candidates 5.6% 1
Team will remain flat through year-end 44.4% 8
Currently reducing the size of the team 5.6% 1
No current presence or plans to expand in the UK or Europe 38.9% 7
Other (please specify) 0
answered question 18
Middle East: How would you best characterize your current firm's hiring plans within *Middle Eastern* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 6.3% 1
Opportunistically meeting potential candidates 12.5% 2
Team will remain flat through year-end 12.5% 2
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in the Middle East 68.8% 11
Other (please specify) 0
answered question 16
In your view, what is the most effective strategy for a firm to expand its marketing effort overseas?
Answer Options Response Percent Response Count
Exporting an existing team member overseas 27.8% 5
Hiring an outside candidate within the local region 66.7% 12
Cover the region from the US 5.6% 1
Not applicable: my current firm does not have a marketing presence outside of the US
0.0% 0
Other (please specify) 0
answered question 18
Private Equity
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 92
How does your firm typically recruit sales & client services professionals? (Check all that apply)
Answer Options Response Percent Response Count
Leveraging industry network 47.1% 8
Sourcing investors 0.0% 0
LinkedIn 17.6% 3
Retained executive search 47.1% 8
Contingency executive search 35.3% 6
Professional associations 0.0% 0
Employee referrals 52.9% 9
Internal recruiting function 17.6% 3
Other (please specify) 0
answered question 17
Has your firm used retained search in the past 2 years to hire sales & client services professionals?
Answer Options Response Percent Response Count
Yes 33.3% 7
No 42.9% 9
I don't know 23.8% 5
answered question 21
Private Equity
Heidrick & Struggles 93
Private Equity: Demographics
What is your current job title?
Answer Options Response Percent Response Count
Associate 0.0% 0
Senior Associate 0.0% 0
Vice President 10.7% 3
Senior Vice President 3.6% 1
Director/Principal 25.0% 7
Managing Director (individual contributor) 28.6% 8
Managing Director (management role) 14.3% 4
Partner 17.9% 5
N/A - Not currently employed 0.0% 0
Other (please specify) 1
answered question 28
How many years of total work experience do you have?
Answer Options Response Percent Response Count
5 - 10 3.4% 1
11 - 15 37.9% 11
16 - 20 27.6% 8
21 - 25 17.2% 5
26+ 13.8% 4
answered question 29
How many years of asset management distribution experience do you have?
Answer Options Response Percent Response Count
5 - 10 41.4% 12
11 - 15 34.5% 10
16 - 20 17.2% 5
21 - 25 6.9% 2
26+ 0.0% 0
answered question 29
Private Equity
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 94
Where do you work?
Answer Options Response Percent Response Count
New York 57.7% 15
Connecticut 3.8% 1
Boston 7.7% 2
Chicago 3.8% 1
San Francisco 3.8% 1
Los Angeles 7.7% 2
Minneapolis 0.0% 0
Philadelphia 3.8% 1
Miami 0.0% 0
Houston 0.0% 0
Dallas 3.8% 1
Washington D.C. 7.7% 2
Other (please specify) 2
answered question 26
Which investment products are offered by your current firm (check all that apply)?
Answer Options Response Percent Response Count
Long Only Equity 10.7% 3
Long Only Fixed Income 7.1% 2
Hedge Funds 28.6% 8
Private Equity 89.3% 25
Hedge Fund of Funds 10.7% 3
Private Equity Fund of Funds 10.7% 3
Real Estate 32.1% 9
Commodities 3.6% 1
Infrastructure 32.1% 9
Other (please specify) 5
answered question 28
How would you characterize the primary focus of your current role?
Answer Options Response Percent Response Count
Sales / Fundraising 37.5% 9
Investor Relations / Client Service (client facing) 20.8% 5
Investor Relations / Client Service (non client facing / support) 4.2% 1
Hybrid Sales & Investor Relations 20.8% 5
Product Specialist 8.3% 2
Consultant Relations 8.3% 2
Other (please specify) 6
answered question 24
Private Equity
Heidrick & Struggles 95
What are the total assets under management of your current firm?
Answer Options Response Percent Response Count
<$200mln 10.3% 3
$200mln - $500mln 6.9% 2
$500mln - $1bln 0.0% 0
$1bln 0.0% 0
$2bln 6.9% 2
$3bln 3.4% 1
$4bln 3.4% 1
$5bln 0.0% 0
$6bln 6.9% 2
$7bln 3.4% 1
$8bln 0.0% 0
$9bln 6.9% 2
$10bln 0.0% 0
$11bln 3.4% 1
$12bln 3.4% 1
$13bln 3.4% 1
$14bln 0.0% 0
$15bln 3.4% 1
$16bln 0.0% 0
$17bln 3.4% 1
$18bln 3.4% 1
$19bln 0.0% 0
$20bln - $29bln 6.9% 2
$30bln - $39bln 3.4% 1
$40bln - $49bln 3.4% 1
$50bln - $59bln 3.4% 1
$60bln+ 13.8% 4
Other (please specify) 1
answered question 29
Private Equity
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 96
Real Estate
Despite a limited sample size of 23 distribution professionals who identified their firms as private real estate asset
managers, several interesting themes emerged from our study of this segment of the industry.
Even though there is higher reported confidence in the strategy among institutional investors (according to the
research firm Preqin), the fundraising environment for private real estate continues to prove challenging. Launching
a new fund is particularly difficult with so many funds already in the market that are capable of demonstrating
performance numbers through up and down markets. However, 2013 is trending positively, with some very welcome
momentum for a group of fundraising professionals who have suffered their fair share of battle fatigue in recent years.
A higher percentage of the talent pool focused on real estate hold advanced degrees than their broader asset
management peers, with 73.9% holding an MBA or master’s degree compared to 56.5% of participants overall.
Movement among this group has been very high, with 66% reporting they changed employers within the past three
years. The majority of those who moved saw a compensation increase, with 30% remaining flat and 10% experiencing
a decrease. When accepting a new position, 30% received a make-whole bonus, which was high compared to an
industry average of 14%; sign-on bonuses were less common. Unlike any other asset management category we
examined, real estate distribution professionals ranked compensation as the top motivator for changing firms. The
opportunity to grow and build a marketing effort ranked second and firm culture ranked third. Currently employed
respondents reported higher rates of “actively looking” when asked to describe their current state of mind—33.3%
compared to the industry average of 17.8%.
Regarding capital raising and retention, just 26.7% of respondents view capital raising as more difficult today
compared to three years ago. That is quite an optimistic view compared to the broader industry, where 61.53% said
capital raising is more difficult. Two-thirds of real estate respondents view the difficulty in retaining capital as “about
the same,” compared to 48.5% of the industry overall. This optimism is likely a reflection of increasing institutional
investor interest in specialized fixed-income products. The percentage of inflows coming from new investors was
75.9%, the highest of the firm types we looked at; the industry average was 65.48%. The median amount of capital
raised per marketer was lower than the broader industry for 2012 ($100 million) and 2013 (projected to be $162.5
million for the year), and the percentage of marketers who reported raising zero capital in those calendar years was the
highest in the industry. Nevertheless, inflows are trending positively for real estate funds.
The view on compensation is cautiously optimistic, with half of respondents expecting an increase in their bonus this
year and 35.7% thinking it’s too early in the year to estimate bonus levels; only 7.1% expect a decrease. More than half
(53.3%) said their bonuses are structured on a part formula/part discretionary basis, which is the structure that 80% of
them prefer. Deferred cash compensation remains low, with almost all of the respondents (92.3%) reporting that less
than 10% of their 2012 cash bonus was deferred. Talent in the real estate category report a level of fund participation
considerably higher than their peers, at 71.4% compared to an industry average of 27.4%.
Real estate distribution teams are generally smaller and less structured than those in the broader industry, with
62.5% of respondents reporting no formal alignment and the rest equally split between geography (18.8%) and client
channel (18.8%). Only 26.7% said their firms employ product specialists, who report either exclusively to the investment
team or dually to the investment and sales teams.
Real Estate
Heidrick & Struggles 97
How is performance measured beyond capital raising and retention? The most commonly cited performance metrics
are (in order):
1. Contributions to firm building and adding value across the firm
2. Activity such as meetings, consultant contacts gained and calling
3. Team collaboration
Hiring among real estate managers for the remainder of 2013 is expected to be relatively quiet in the United States,
with 80% of respondents expecting their teams to remain flat. None reported that their firms were actively recruiting
and 13.3% said they were meeting opportunistically with candidates.
The majority of respondents reported that their firms do not have a marketing presence outside the U.S. and are not
actively looking to build one. That is surprising, given conversations that Heidrick & Struggles started in recent months
with several firms looking to build efforts in Asia and Europe. Earlier, we noted higher levels of optimism around
inflows. If that optimism is borne out, we may see global hiring activity rise accordingly.
What is the highest level of education you have completed?
Answer Options Response Percent Response Count
Bachelor's Degree 21.7% 5
Master's Degree (non MBA) 30.4% 7
MBA 43.5% 10
Ph.D. 4.3% 1
answered question 23
Did you change firms during the past 3 years?
Answer Options Response Percent Response Count
Yes 66.7% 10
No 33.3% 5
answered question 15
If yes, by what percentage did your total compensation change?
Answer Options Response Percent Response Count
Remained Flat 30.0% 3
Increased by 1% - 9% 10.0% 1
Increased by 10% - 19% 10.0% 1
Increased by 20% - 29% 20.0% 2
Increased by 30% - 39% 20.0% 2
Increased by 40%+ 0.0% 0
Decreased by 1% - 9% 0.0% 0
Decreased by 10% - 19% 0.0% 0
Decreased by 20% - 29% 0.0% 0
Decreased by 30% - 39% 10.0% 1
Decreased by 40%+ 0.0% 0
answered question 10
Real Estate
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 98
If you changed firms, were you offered a (check all that apply):
Answer Options Response Percent Response Count
Sign-on bonus 20.0% 2
Buy out of equity 0.0% 0
Make whole bonus (100% of anticipated bonus at previous firm) 30.0% 3
Minimum bonus floor (% of anticipated bonus at previous firm) 30.0% 3
Not applicable 40.0% 4
Other (please specify) 0
answered question 10
If you changed firms in the past 3 years, please rank your primary motivation(s) for change:Answered: 10
9.80
7.00
9.20
7.43
7.38
8.22
7.60
9.30
7.40
6.44
6.89
6.75
Management opportunity
Compensation
Firm Culture
Brand
Marketability of products
Layoffs or restructuring
Ability to have influence outside of fundraising
Level of value placed on marketing
People
Opportunity to grow/build the marketing effort
Greater opportunities for advancement
Firm's willingness to meet client expectataions
How would you characterize your current state of mind?
Answer Options Response Percent Response Count
Actively looking (unemployed) 6.7% 1
Actively looking (currently employed) 33.3% 5
Not looking but open to considering new opportunities if presented 40.0% 6
Not open to considering new opportunities 20.0% 3
Other (please specify) 0
answered question 15
Real Estate
Heidrick & Struggles 99
What is your view on the level of difficulty in raising capital today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 20.0% 3
Moderately more difficult 0.0% 0
Significantly more difficult 6.7% 1
About the same 33.3% 5
Moderately easier 33.3% 5
Significantly easier 6.7% 1
Other (please specify) 0
answered question 15
What is your view on the level of difficulty in retaining client assets today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 13.3% 2
Moderately more difficult 13.3% 2
Significantly more difficult 0.0% 0
About the same 66.7% 10
Moderately easier 6.7% 1
Significantly easier 0.0% 0
Other (please specify) 0
answered question 15
Percentage of inflows from new vs. existing investors
2012% Inflows from New
Investors % Inflows from Existing
Investors
Real Estate 75.89 24.11
Capital raising levels per marketer
Firm Type Year Mean Median Range
# of marketers that raised zero capital
% of marketers that raised zero capital Notes
Real Estate 2012 $131,166,666 $100,000,000 $0 - $522,000,000 4/12 33.33%
Real Estate 2013 *YTD
$177,318,181 $162,500,000 $0 - $650,000,000 3/11 27.27%
* YTD as of June 2013
Real Estate
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 100
What are your bonus expectations for 2013 compared to 2012?
Answer Options Response Percent Response Count
Increased by less than 10% 7.1% 1
Increased by 11% - 15% 0.0% 0
Increased by 16% - 20% 0.0% 0
Increased by 21% - 25% 28.6% 4
Increased by 26% - 30% 7.1% 1
Increased by 31% - 35% 0.0% 0
Increased by 36% - 40% 7.1% 1
Flat from my 2012 bonus 7.1% 1
Increased by greater than 40% 0.0% 0
Decreased by less than 10% 7.1% 1
Decreased by 11% - 15% 0.0% 0
Decreased by 16% - 20% 0.0% 0
Decreased by 21% - 25% 0.0% 0
Decreased by 26% - 30% 0.0% 0
Decreased by 31% - 35% 0.0% 0
Decreased by 36% - 40% 0.0% 0
Decreased by greater than 40% 0.0% 0
Still too early in the year to estimate 35.7% 5
Other (please specify) 1
answered question 14
What percentage of your cash bonus was deferred in 2012?
Answer Options Response Percent Response Count
Less than 10% 92.3% 12
10% - $19% 7.7% 1
20% - 29% 0.0% 0
30% - 39% 0.0% 0
40% - 49% 0.0% 0
50% - 60% 0.0% 0
60% - 70% 0.0% 0
70%+ 0.0% 0
answered question 13
Real Estate
Heidrick & Struggles 101
What other components comprise your total compensation (check all that apply)??
Answer Options Response Percent Response Count
Stock options 0.0% 0
Participation in the funds 71.4% 5
Equity-like participation 57.1% 4
Sign on bonus 14.3% 1
Retention bonus 0.0% 0
Other (please specify) 4
answered question 7
Which option best characterizes your current bonus structure?
Answer Options Response Percent Response Count
Purely formulaic 13.3% 2
Loosely formulaic driven by metrics 6.7% 1
Purely Discretionary 26.7% 4
Part formula / part discretionary 53.3% 8
Other (please specify) 0.0% 0
Other (please specify) 15
Which bonus structure do you prefer?
Answer Options Response Percent Response Count
Purely formulaic 13.3% 2
Loosely formulaic driven by metrics 6.7% 1
Purely Discretionary 0.0% 0
Part formula / part discretionary 80.0% 12
Agnostic 0.0% 0
Other (please specify) 3
answered question 15
How are real estate managers structuring their distribution efforts?Mean Median Range
# of sales/fundraising professionals 2.9 2 1-7
# of product specialists (for firms with product specialists) NA NA NA
# of client facing investor relations professionals 2.7 2 1.7
# of non - client facing client services professionals 3.1 2.5 1-11
Real Estate
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 102
How is coverage among your current sales team (primarily) aligned?
Answer Options Response Percent Response Count
Geographically 18.8% 3
Client Channel 18.8% 3
Product 0.0% 0
No formal alignment 62.5% 10
Other (please specify) 0
answered question 16
Where do product specialists at your firm report in to?
Answer Options Response Percent Response Count
Investment team 13.3% 2
Sales team 0.0% 0
Dual Reporting to investment and sales teams 13.3% 2
Not applicable - my firm does not employ product specialists 73.3% 11
Other (please specify) 0
answered question 15
How successful has the product specialist role been within your current firm?
Answered: 15
N/A - my firm does notemploy product specialists
13%
73%
0%
0%
7%
7%
Highly successful
Moderately successful
Neutral
Not very successful
Not at all successful
US: How would you best characterize your current firm’s hiring plans within *US* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 0.0% 0
Opportunistically meeting potential candidates 13.3% 2
Team will remain flat through year-end 80.0% 12
Currently reducing the size of the team 6.7% 1
Other (please specify) 0
answered question 15
Real Estate
Heidrick & Struggles 103
Asia: How would you best characterize your current firm’s hiring plans within *Asia* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 0.0% 0
Opportunistically meeting potential candidates 13.3% 2
Team will remain flat through year-end 6.7% 1
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in to Asia 80.0% 12
answered question 15
UK/Europe: How would you best characterize your current firm's hiring plans within *UK/European* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 0.0% 0
Opportunistically meeting potential candidates 6.7% 1
Team will remain flat through year-end 20.0% 3
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in the UK or Europe 73.3% 11
Other (please specify) 0
answered question 15
Middle East: How would you best characterize your current firm's hiring plans within *Middle Eastern* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 7.1% 1
Opportunistically meeting potential candidates 0.0% 0
Team will remain flat through year-end 0.0% 0
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in the Middle East 92.9% 13
Other (please specify) 0
answered question 14
In your view, what is the most effective strategy for a firm to expand its marketing effort overseas?
Answer Options Response Percent Response Count
Exporting an existing team member overseas 7.1% 1
Hiring an outside candidate within the local region 78.6% 11
Cover the region from the US 0.0% 0
Not applicable: my current firm does not have a marketing presence outside of the US
14.3% 2
Other (please specify) 0
answered question 14
Real Estate
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 104
How does your firm typically recruit sales & client services professionals? (Check all that apply)
Answer Options Response Percent Response Count
Leveraging industry network 46.7% 7
Sourcing investors 0.0% 0
LinkedIn 20.0% 3
Retained executive search 46.7% 7
Contingency executive search 20.0% 3
Professional associations 13.3% 2
Employee referrals 46.7% 7
Internal recruiting function 33.3% 5
Other (please specify) 0
answered question 15
Has your firm used retained search in the past 2 years to hire sales & client services professionals?
Answer Options Response Percent Response Count
Yes 40.0% 6
No 46.7% 7
I don't know 13.3% 2
answered question 15
Real Estate
Heidrick & Struggles 105
Real Estate: Demographics
What is your current job title?
Answer Options Response Percent Response Count
Associate 0.0% 0
Senior Associate 4.8% 1
Vice President 9.5% 2
Senior Vice President 19.0% 4
Director/Principal 19.0% 4
Managing Director (individual contributor) 23.8% 5
Managing Director (management role) 14.3% 3
Partner 9.5% 2
N/A - Not currently employed 0.0% 0
Other (please specify) 2
answered question 21
How many years of total work experience do you have?
Answer Options Response Percent Response Count
5 - 10 17.4% 4
11 - 15 21.7% 5
16 - 20 13.0% 3
21 - 25 17.4% 4
26+ 30.4% 7
answered question 23
How many years of asset management distribution experience do you have?
Answer Options Response Percent Response Count
5 - 10 45.5% 10
11 - 15 27.3% 6
16 - 20 9.1% 2
21 - 25 9.1% 2
26+ 9.1% 2
answered question 22
Real Estate
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 106
Where do you work?
Answer Options Response Percent Response Count
New York 36.4% 8
Connecticut 4.5% 1
Boston 13.6% 3
Chicago 18.2% 4
San Francisco 13.6% 3
Los Angeles 0.0% 0
Minneapolis 0.0% 0
Philadelphia 9.1% 2
Miami 0.0% 0
Houston 0.0% 0
Dallas 0.0% 0
Washington D.C. 4.5% 1
Other (please specify) 1
answered question 22
Which investment products are offered by your current firm (check all that apply)?
Answer Options Response Percent Response Count
Long Only Equity 0.0% 0
Long Only Fixed Income 0.0% 0
Hedge Funds 0.0% 0
Private Equity 8.7% 2
Hedge Fund of Funds 0.0% 0
Private Equity Fund of Funds 4.3% 1
Real Estate 95.7% 22
Commodities 0.0% 0
Infrastructure 4.3% 1
Other (please specify) 0
answered question 23
How would you characterize the primary focus of your current role?
Answer Options Response Percent Response Count
Sales / Fundraising 38.1% 8
Investor Relations / Client Service (client facing) 33.3% 7
Investor Relations / Client Service (non client facing / support) 4.8% 1
Hybrid Sales & Investor Relations 23.8% 5
Product Specialist 0.0% 0
Consultant Relations 0.0% 0
Other (please specify) 2
answered question 21
Real Estate
Heidrick & Struggles 107
What are the total assets under management of your current firm?
Answer Options Response Percent Response Count
<$200mln 4.5% 1
$200mln - $500mln 18.2% 4
$500mln - $1bln 13.6% 3
$1bln 18.2% 4
$2bln 0.0% 0
$3bln 9.1% 2
$4bln 9.1% 2
$5bln 0.0% 0
$6bln 0.0% 0
$7bln 4.5% 1
$8bln 0.0% 0
$9bln 0.0% 0
$10bln 4.5% 1
$11bln 4.5% 1
$12bln 0.0% 0
$13bln 0.0% 0
$14bln 0.0% 0
$15bln 0.0% 0
$16bln 0.0% 0
$17bln 0.0% 0
$18bln 0.0% 0
$19bln 0.0% 0
$20bln - $29bln 4.5% 1
$30bln - $39bln 4.5% 1
$40bln - $49bln 4.5% 1
$50bln - $59bln 0.0% 0
$60bln+ 0.0% 0
Other (please specify) 4
answered question 22
Real Estate
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 108
Placement Agents
With just 5.9% of our survey respondents saying they worked at placement agents, the sample size (27 people) is
too small to draw many hard and fast conclusions. Nevertheless, we wanted to share some insights into this unique
population, particularly since a placement agent role can often serve as a stepping stone towards an in-house
marketing role for those looking to make the transition. The majority of respondents had 10+ years of total work
experience, with 29.6% reporting 26+ years. Nearly half (48.1%) had just 5-10 years of asset management experience,
indicating they are relatively new to the business.
Placement agents are more likely to have MBAs (51.9%) than the general asset management population. They are
less likely to have changed firms in the past three years, with just 44.4% reporting they had done so. Individuals
joining placement agents did not experience the same compensation gains as their broader industry peers: just
30.8% reported an increase in compensation, 46.2% remained flat and 23.1% saw a decrease. We do not know if these
individuals were in fact making a career transition, but we suspect that is the case and that it influenced compensation.
The highest-ranking motivator for making a change was overwhelmingly firm culture, followed by people and
marketability of products, which tied for second place. About 32% of survey participants were actively looking for new
roles and 47.4% were open to considering new opportunities.
How do placement agents view the level of difficulty in capital raising today compared to three years ago?
Respondents in this group proved quite divided in their views: 47.4% rated it as more difficult and 36.9% as easier, with
15.8% saying it is about the same. About 41% said retention of client assets is more difficult today and an equal number
said it is about the same; just 17.7% rated retention as easier. Placement agents reported that an average of 59.88% of
capital came from new investors in 2012.
Our survey found median capital raising levels of $105 million per marketer in 2012 to be in line with the broader
industry. Capital raising among placement agents appears to be going up substantially in 2013, with a median of $500
million raised per marketer YTD. When we looked closely at the reported numbers, we found four marketers who
had already hit the $1 billion mark through the first six months of 2013 and only one who had not raised any capital
so far this year. Given the small sample size for this question (16 respondents), these figures may not reflect the full
population of placement agent distribution professionals.
Perhaps corresponding to the reported capital amounts raised in the first six months of the year, bonus expectations
for 2013 are generally high, with 53% of respondents expecting an increase from 2012, 11.8% expecting to remain flat
and 35.3% saying it’s too early in the year to estimate. The majority of placement agents (68.8%) reported deferred
bonus rates of less than 10% in 2012, with 25.1% indicating deferred bonus percentages of 50% or greater. Beyond
base and cash bonus, survey respondents indicated being awarded stock options, the opportunity to participate in the
funds and equity-like participation as part of their total compensation in 2012. About 39% of respondents said their
bonuses were purely formulaic, with an equal number reporting a purely discretionary bonus. Placement agents seem
to be quite divided about their preferred compensation structure. Oddly enough, the highest percentage (33.3%) said
they prefer a purely formulaic bonus but many expressed the desire for more hybrid or discretionary models.
Distribution teams at placement agents are most often aligned geographically (72.2%). Not surprisingly, product
specialist roles are uncommon, with 66.7% of respondents reporting their firms do not employ product specialists,
although when the function exists it is often viewed as successful.
Placement A
gents
Heidrick & Struggles 109
Beyond capital raising, how are placement agents measuring performance? The most commonly cited performance
metrics are (in order):
• Contributions to business development and project management
• Team collaboration
• Firm/brand building
There is a decent amount of hiring activity among placement agents globally, although most will keep their teams flat
for the year. About 18% of respondents said their firms were actively recruiting and 29.4% opportunistically meeting
candidates in the United States. Outside the U.S., 21.1% of respondents said their firms were either actively recruiting
or opportunistically meeting candidates in Asia, 16.7% in UK/Europe and 11.1% in the Middle East. Placement agents
typically hire directly, with only 21.1% of respondents saying their firms use retained executive search as part of their
recruiting strategy, well below the industry average of 51.9%.
What is the highest level of education you have completed?
Answer Options Response Percent Response Count
Bachelor's Degree 37.0% 10
Master's Degree (non MBA) 11.1% 3
MBA 51.9% 14
Ph.D. 0.0% 0
answered question 27
Did you change firms during the past 3 years?
Answer Options Response Percent Response Count
Yes 44.4% 8
No 55.6% 10
answered question 18
If yes, by what percentage did your total compensation change?
Answer Options Response Percent Response Count
Remained Flat 46.2% 6
Increased by 1% - 9% 0.0% 0
Increased by 10% - 19% 15.4% 2
Increased by 20% - 29% 7.7% 1
Increased by 30% - 39% 0.0% 0
Increased by 40%+ 7.7% 1
Decreased by 1% - 9% 0.0% 0
Decreased by 10% - 19% 7.7% 1
Decreased by 20% - 29% 0.0% 0
Decreased by 30% - 39% 0.0% 0
Decreased by 40%+ 15.4% 2
answered question 13
Placement A
gents
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 110
If you changed firms, were you offered a (check all that apply):
Answer Options Response Percent Response Count
Sign-on bonus 0.0% 0
Buy out of equity 0.0% 0
Make whole bonus (100% of anticipated bonus at previous firm) 0.0% 0
Minimum bonus floor (% of anticipated bonus at previous firm) 0.0% 0
Not applicable 100.0% 8
Other (please specify) 1
answered question 8
If you changed firms in the past 3 years, please rank your primary motivation(s) for change:Answered: 8
9.17
3.25
11.00
6.80
8.33
9.75
10.00
8.00
8.00
6.75
10.00
7.17
Management opportunity
Compensation
Firm Culture
Brand
Marketability of products
Layoffs or restructuring
Ability to have influence outside of fundraising
Level of value placed on marketing
People
Opportunity to grow/build the marketing effort
Greater opportunities for advancement
Firm's willingness to meet client expectataions
How would you characterize your current state of mind?
Answer Options Response Percent Response Count
Actively looking (unemployed) 0.0% 0
Actively looking (currently employed) 31.6% 6
Not looking but open to considering new opportunities if presented 47.4% 9
Not open to considering new opportunities 21.1% 4
Other (please specify) 0
answered question 19
Placement A
gents
Heidrick & Struggles 111
What is your view on the level of difficulty in raising capital today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 10.5% 2
Moderately more difficult 15.8% 3
Significantly more difficult 21.1% 4
About the same 15.8% 3
Moderately easier 31.6% 6
Significantly easier 5.3% 1
Other (please specify) 0
answered question 19
What is your view on the level of difficulty in retaining client assets today compared to 3 years ago?
Answer Options Response Percent Response Count
Slightly more difficult 11.8% 2
Moderately more difficult 11.8% 2
Significantly more difficult 17.6% 3
About the same 41.2% 7
Moderately easier 11.8% 2
Significantly easier 5.9% 1
Other (please specify) 0
answered question 17
Capital raising levels per marketer
Firm Type Year Mean Median Range
# of marketers that raised zero capital
% of marketers that raised zero capital Notes
Placement Agents
2012 $358,571,429 $105,000,000 $0 – $2,000,000,000
2/15 13.33%
Placement Agents
2013 *YTD
$494,000,000 $500,000,000 $0 – $1,000,000,000
1/16 6.25% Excluding 5 outliers citing $6bln, $7bln, $8bln, $10bln and $12bln
* YTD as of June 2013
Placement A
gents
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 112
What are your bonus expectations for 2013 compared to 2012?
Answer Options Response Percent Response Count
Increased by less than 10% 0.0% 0
Increased by 11% - 15% 5.9% 1
Increased by 16% - 20% 5.9% 1
Increased by 21% - 25% 5.9% 1
Increased by 26% - 30% 0.0% 0
Increased by 31% - 35% 5.9% 1
Increased by 36% - 40% 23.5% 4
Increased by greater than 40% 5.9% 1
Flat from my 2012 bonus 11.8% 2
Decreased by less than 10% 0.0% 0
Decreased by 11% - 15% 0.0% 0
Decreased by 16% - 20% 0.0% 0
Decreased by 21% - 25% 0.0% 0
Decreased by 26% - 30% 0.0% 0
Decreased by 31% - 35% 0.0% 0
Decreased by 36% - 40% 0.0% 0
Decreased by greater than 40% 0.0% 0
Still too early in the year to estimate 35.3% 6
Other (please specify) 2
answered question 17
What percentage of your cash bonus was deferred in 2012?
Answer Options Response Percent Response Count
Less than 10% 68.8% 11
10% - $19% 6.3% 1
20% - 29% 0.0% 0
30% - 39% 0.0% 0
40% - 49% 0.0% 0
50% - 60% 12.5% 2
60% - 70% 6.3% 1
70%+ 6.3% 1
answered question 16
Placement A
gents
Heidrick & Struggles 113
What other components comprise your total compensation (check all that apply)??
Answer Options Response Percent Response Count
Stock options 22.2% 2
Participation in the funds 22.2% 2
Equity-like participation 77.8% 7
Sign on bonus 0.0% 0
Retention bonus 0.0% 0
Other (please specify) 0
answered question 9
Which option best characterizes your current bonus structure?
Answer Options Response Percent Response Count
Purely formulaic 38.9% 7
Loosely formulaic driven by metrics 11.1% 2
Purely Discretionary 38.9% 7
Part formula / part discretionary 11.1% 2
Other (please specify) 0
answered question 18
Which bonus structure do you prefer?
Answer Options Response Percent Response Count
Purely formulaic 33.3% 6
Loosely formulaic driven by metrics 16.7% 3
Purely Discretionary 22.2% 4
Part formula / part discretionary 22.2% 4
Agnostic 5.6% 1
Other (please specify) 0
answered question 18
How is coverage among your current sales team (primarily) aligned?
Answer Options Response Percent Response Count
Geographically 72.2% 13
Client Channel 5.6% 1
Product 5.6% 1
No formal alignment 16.7% 3
Other (please specify) 1
answered question 18
Placement A
gents
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 114
Where do product specialists at your firm report in to?
Answer Options Response Percent Response Count
Investment team 0.0% 0
Sales team 22.2% 4
Dual Reporting to investment and sales teams 11.1% 2
Not applicable - my firm does not employ product specialists 66.7% 12
Other (please specify) 0
answered question 18
How successful has the product specialist role been within your current firm?Answered: 19
N/A - my firm does notemploy product specialists
5%
21%
63%
0%
0%
11%
Highly successful
Moderately successful
Neutral
Not very successful
Not at all successful
US: How would you best characterize your current firm’s hiring plans within *US* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 17.6% 3
Opportunistically meeting potential candidates 29.4% 5
Team will remain flat through year-end 52.9% 9
Currently reducing the size of the team 0.0% 0
Other (please specify) 0
answered question 17
Asia: How would you best characterize your current firm’s hiring plans within *Asia* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 5.3% 1
Opportunistically meeting potential candidates 15.8% 3
Team will remain flat through year-end 36.8% 7
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in to Asia 42.1% 8
answered question 19
Placement A
gents
Heidrick & Struggles 115
UK/Europe: How would you best characterize your current firm's hiring plans within *UK/European* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 5.6% 1
Opportunistically meeting potential candidates 11.1% 2
Team will remain flat through year-end 44.4% 8
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in the UK or Europe 38.9% 7
Other (please specify) 0
answered question 18
Middle East: How would you best characterize your current firm's hiring plans within *Middle Eastern* distribution for the remainder of 2013?
Answer Options Response Percent Response Count
Currently actively recruiting 0.0% 0
Opportunistically meeting potential candidates 11.1% 2
Team will remain flat through year-end 11.1% 2
Currently reducing the size of the team 0.0% 0
No current presence or plans to expand in the Middle East 77.8% 14
Other (please specify) 0
answered question 18
In your view, what is the most effective strategy for a firm to expand its marketing effort overseas?
Answer Options Response Percent Response Count
Exporting an existing team member overseas 0.0% 0
Hiring an outside candidate within the local region 88.2% 15
Cover the region from the US 0.0% 0
Not applicable: my current firm does not have a marketing presence outside of the US
11.8% 2
Other (please specify) 0
answered question 17
Placement A
gents
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 116
How does your firm typically recruit sales & client services professionals? (Check all that apply)
Answer Options Response Percent Response Count
Leveraging industry network 57.9% 11
Sourcing investors 15.8% 3
LinkedIn 21.1% 4
Retained executive search 21.1% 4
Contingency executive search 21.1% 4
Professional associations 10.5% 2
Employee referrals 52.6% 10
Internal recruiting function 31.6% 6
Other (please specify) 0
answered question 19
Has your firm used retained search in the past 2 years to hire sales & client services professionals?
Answer Options Response Percent Response Count
Yes 5.3% 1
No 78.9% 15
I don't know 15.8% 3
answered question 19
Placement A
gents
Heidrick & Struggles 117
Placement Agents: Demographics
What is your current job title?
Answer Options Response Percent Response Count
Associate 8.0% 2
Senior Associate 4.0% 1
Vice President 12.0% 3
Senior Vice President 0.0% 0
Director/Principal 20.0% 5
Managing Director (individual contributor) 8.0% 2
Managing Director (management role) 8.0% 2
Partner 36.0% 9
N/A - Not currently employed 4.0% 1
Other (please specify) 2
answered question 25
How many years of total work experience do you have?
Answer Options Response Percent Response Count
5 - 10 18.5% 5
11 - 15 22.2% 6
16 - 20 11.1% 3
21 - 25 18.5% 5
26+ 29.6% 8
answered question 27
How many years of asset management distribution experience do you have?
Answer Options Response Percent Response Count
5 - 10 48.1% 13
11 - 15 14.8% 4
16 - 20 14.8% 4
21 - 25 14.8% 4
26+ 7.4% 2
answered question 27
Placement A
gents
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 118
Where do you work?
Answer Options Response Percent Response Count
New York 56.5% 13
Connecticut 4.3% 1
Boston 8.7% 2
Chicago 4.3% 1
San Francisco 13.0% 3
Los Angeles 4.3% 1
Minneapolis 0.0% 0
Philadelphia 4.3% 1
Miami 4.3% 1
Houston 0.0% 0
Dallas 0.0% 0
Washington D.C. 0.0% 0
Other (please specify) 4
answered question 23
Which investment products are offered by your current firm (check all that apply)?
Answer Options Response Percent Response Count
Long Only Equity 16.0% 4
Long Only Fixed Income 8.0% 2
Hedge Funds 40.0% 10
Private Equity 84.0% 21
Hedge Fund of Funds 8.0% 2
Private Equity Fund of Funds 28.0% 7
Real Estate 60.0% 15
Commodities 20.0% 5
Infrastructure 36.0% 9
Other (please specify) 3
answered question 25
How would you characterize the primary focus of your current role?
Answer Options Response Percent Response Count
Sales / Fundraising 76.9% 20
Investor Relations / Client Service (client facing) 7.7% 2
Investor Relations / Client Service (non client facing / support) 0.0% 0
Hybrid Sales & Investor Relations 15.4% 4
Product Specialist 0.0% 0
Consultant Relations 0.0% 0
Other (please specify) 1
answered question 26
Placement A
gents
Part Three – Compensation
Contents
Base Salary
• Traditional asset managers: sales/fundraising and hybrid sales and 123 investor relations
• Multi-product asset managers: sales/fundraising and hybrid sales and 124 investor relations
• Hedge funds: sales/fundraising and hybrid sales and investor relations 125• Private equity: sales/fundraising and hybrid sales and investor relations 126• Real estate: sales/fundraising and hybrid sales and investor relations 127• Investor relations function 128• Product specialist function: all firm types and levels 129• Consultant relations function: all firm types and levels 129• Placement agents: all firm types and levels 130
Bonus
• Traditional asset managers: sales/fundraising and hybrid sales and 131 investor relations
• Multi-product asset managers: sales/fundraising and hybrid sales and 132 investor relations
• Hedge funds: sales/fundraising and hybrid sales and investor relations 133• Private equity: sales/fundraising and hybrid sales and investor relations 134• Real estate: sales/fundraising and hybrid sales and investor relations 135• Investor relations function 136• Product specialist function: all firm types 137• Consultant relations function: all firm types 137• Placement agents 138
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 120
In the following pages we will present our findings on cash compensation, specifically base and bonus. We collected this data in range format rather than raw numbers, an approach that made it easier to capture the data but more difficult to present it. In future studies we will take a different approach.
We had large sample sizes for the sales/fundraising and hybrid sales/fundraising roles, so in those cases we segmented the data by job function, level and firm type in order to provide the greatest level of clarity. Where we had smaller sample sizes, specifically for investor relations/client services, product specialists and consultant relations, we provided a broader view.
The graphs represent the percentage of individuals reporting their compensation fell within certain ranges.
Finally, we took a shot at answering the question, “Do MBAs earn more?” We found a higher representation of MBAs at the higher base levels, but an MBA’s impact on bonus compensation is less clear.
Compensation
Heidrick & Struggles 121
Compensation Summary
Base compensation ranges: fundraising and hybrid/fundraising investor relations functions
TitleTraditional Long
Only Multi-Product Private Equity Hedge Funds Real Estate
Vice President 150,000 – 300,000+ 125,000 – 300,000+ 125,000 – 250,000 No data available 175,000 – 225,000
Senior Vice President
150,000 – 300,000 100,000 – 300,000 150,000 – 300,000+ 150,000 – 275,000 200,000 – 250,000
Director/Principal
125,000 – 275,000 150,000 – 300,000+ 150,000 – 300,000+ 125,000 – 275,000 100,000 – 300,000+
MD – Individual Contributor
200,000 – 300,000 150,000 – 300,000+ 100,000 – 300,000+ 150,000 – 300,000+ 175,000 – 275,000+
MD – Management
175,000 – 300,000 175,000 – 300,00+ 150,000 – 300,000+ 150,000 – 300,000+ 175,000 – 275,000+
Partner No data available No data available No data available 175,000 – 300,000+ No data available
Sample Size 37 71 11 55 9
Bonus compensation ranges: fundraising and hybrid/fundraising investor relations functions
TitleTraditional Long
Only Multi-Product Private Equity Hedge Funds Real Estate
Vice President 100,000 – 200,000 100,000 - 1.1mln 100,000 – 200,000 100,000 – 400,000 No data available
Senior Vice President
100,000 – 600,000 *plus two outliers reporting 1.7mln+
100,000 - 500,000 *plus two outliers reporting 1.2mln+
No data available 300,000 – 900,000 100,000 – 200,000
Director/Principal
100,000 - 1.3mln 100,000 - 900,000 200,000 – 700,000 100,000 – 1.1mln 100,000 – 300,000
MD – Individual Contributor
100,000 – 1.1mln 100,000 – 1.1mln 100,000 – 400,000 100,000 – 3.5mln 100,000 – 1.1mln
MD – Management
100,000 - 1.7mln 100,000 – 2.5mln 100,000 – 600,000 100,000 – 3mln No data available
Partner No data available 100,000 – 1.6mln 300,000 – 1.9mln 200,000 – 1.9mln No data available
Sample Size 37 72 11 55 9
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 122
Due to smaller sample sizes in several job functions, we summarized our findings below:
Base compensation ranges
Function Base Compensation
Range Sample Size
Investor Relations $125,000 – $300,000+ 22
Product Specialist $125,000 – $300,000+ 13
Consultant Relations $100,000 – $300,000+ 54
Placement Agents $100,000 – $300,000+ 17
Bonus compensation ranges
Function Base Compensation
Range Sample Size
Investor Relations $100,000 – $800,000 22
Product Specialist $100,000 – $1.1mln 13
Consultant Relations $100,000 – $900,000 53
Placement Agents $100,000 – $1.4mln 17
Heidrick & Struggles 123
Traditional asset managers: sales/fundraising and hybrid sales and investor relations Total number of respondents: 37
Vice President
$150,000 ‑ $174,000 66.7%
$300,000+ 33.3%
Total Respondents 3
Director/Principal
$125,000 ‑ $149,000 25.0%
$150,000 ‑ $174,000 25.0%
$175,000 ‑ $199,000 12.5%
$200,000 ‑ $224,000 25.0%
$250,000 ‑ $274,000 12.5%
Total Respondents 8
MD – Managemen Role
$175,000 ‑ $199,000 7.1%
$200,000 ‑ $224,000 21.4%
$225,000 ‑ $249,000 14.3%
$250,000 ‑ $274,000 7.1%
$300,000+ 42.9%
Not currently employed 7.1%
Total Respondents 14
Senior Vice President
$150,000 ‑ $174,000 14.3%
$175,000 ‑ $199,000 14.3%
$200,000 ‑ $224,000 14.3%
$225,000 ‑ $249,000 14.3%
$250,000 ‑ $274,000 14.3%
$300,000+ 28.6%
Total Respondents 7
MD - Individual Contributor
$200,000 ‑ $224,000 40.0%
$225,000 ‑ $249,000 40.0%
$275,000 ‑ $299,000 20.0%
Total Respondents 5
Partner
No Respondents
Base Salary
Base Salary
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 124
Vice President
$125,000 ‑ $149,000 17.7%
$150,000 ‑ $174,000 5.9%
$175,000 ‑ $199,000 29.4%
$200,000 ‑ $224,000 29.4%
$275,000 ‑ $299,000 5.9%
$300,000+ 5.9%
Not currently employed 5.9%
Total Respondents 17
Director/Principal
$150,000 ‑ $174,000 15.4%
$175,000 ‑ $199,000 15.4%
$200,000 ‑ $224,000 15.4%
$225,000 ‑ $249,000 15.4%
$250,000 ‑ $274,000 15.4%
$275,000 ‑ $299,000 7.7%
$300,000+ 15.4%
Total Respondents 13
MD – Management Role
$175,000 ‑ $199,000 8.3%
$200,000 ‑ $224,000 25.0%
$225,000 ‑ $249,000 8.3%
$250,000 ‑ $274,000 41.7%
$300,000+ 16.7%
Total Respondents 12
Senior Vice President
$100,000 ‑ $124,000 7.7%
$125,000 ‑ $149,000 7.7%
$150,000 ‑ $174,000 30.1%
$200,000 ‑ $224,000 38.5%
$250,000 ‑ $274,000 7.7%
$275,000 ‑ $299,000 7.7%
Total Respondents 13
MD - Individual Contributor
$150,000 ‑ $174,000 21.4%
$200,000 ‑ $224,000 35.7%
$225,000 ‑ $249,000 14.3%
$250,000 ‑ $274,000 21.4%
$300,000+ 7.1%
Total Respondents 14
Partner
$150,000 ‑ $174,000 50.0%
$200,000 ‑ $224,000 50.0%
Total Respondents 2
Multi-product asset managers: sales/fundraising and hybrid sales and investor relations Total number of respondents: 71 Base Salary
Heidrick & Struggles 125
MD – Management Role
$175,000 ‑ $199,000 5.9%
$200,000 ‑ $224,000 23.5%
$225,000 ‑ $249,000 5.9%
$250,000 ‑ $274,000 41.2%
$275,000 ‑ $299,000 5.9%
$300,000+ 17.7%
Total Respondents 17
Partner
$175,000 ‑ $199,000 14.3%
$200,000 ‑ $224,000 42.9%
$250,000 ‑ $274,000 14.3%
$300,000+ 28.6%
Total Respondents 7
Vice President
$100,000 ‑ $124,000 100.0%
Total Respondents 2
Director/Principal
$125,000 ‑ $149,000 12.5%
$150,000 ‑ $174,000 18.8%
$175,000 ‑ $199,000 6.3%
$200,000 ‑ $224,000 31.3%
$225,000 ‑ $249,000 6.3%
$250,000 ‑ $274,000 25.0%
Total Respondents 16
Senior Vice President
$150,000 ‑ $174,000 20.0%
$200,000 ‑ $224,000 60.0%
$250,000 ‑ $274,000 20.0%
Total Respondents 5
MD - Individual Contributor
$150,000 ‑ $174,000 12.5%
$200,000 ‑ $224,000 25.0%
$225,000 ‑ $249,000 25.0%
$250,000 ‑ $274,000 25.0%
$300,000+ 12.5%
Total Respondents 8
Hedge funds: sales/fundraising and hybrid sales and investor relations Total number of respondents: 55
Base Salary
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 126
MD – Management Role
$150,000 ‑ $174,000 50.0%
$300,000+ 50.0%
Total Respondents 2
Partner
$300,000+ 100.0%
Total Respondents 2
Vice President
$225,000 ‑ $249,000 100.0%
Total Respondents 1
Director/Principal
$150,000 ‑ $174,000 25.0%
$200,000 ‑ $224,000 25.0%
$225,000 ‑ $249,000 25.0%
$300,000+ 25.0%
Total Respondents 4
Senior Vice President
No Respondents
MD - Individual Contributor
$100,000 ‑ $124,000 50.0%
$225,000 ‑ $249,000 50.0%
Total Respondents 2
Private equity: sales/fundraising and hybrid sales and investor relations Total number of respondents: 11
Base Salary
Heidrick & Struggles 127
Vice President
No Respondents
Director/Principal
< $100,000 50.0%
$250,000 ‑ $274,000 25.0%
$275,000 ‑ $299,000 25.0%
Total Respondents 3
MD – Management Role
$175,000 ‑ $199,000 100.0%
Total Respondents 1
Senior Vice President
$200,000 ‑ $224,000 50.0%
$225,000 ‑ $249,000 50.0%
Total Respondents 2
MD - Individual Contributor
$225,000 ‑ $249,000 66.7%
$250,000 ‑ $274,000 33.3%
Total Respondents 3
Partner
No Respondents
Real estate: sales/fundraising and hybrid sales and investor relations Total number of respondents: 9
Base Salary
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 128
Hedge Fund
$100,000 ‑ $124,000 10.0%
$125,000 ‑ $149,000 10.0%
$150,000 ‑ $174,000 10.0%
$175,000 ‑ $199,000 20.0%
$200,000 ‑ $224,000 10.0%
$225,000 ‑ $249,000 10.0%
$250,000 ‑ $274,000 10.0%
$300,000+ 10.0%
Not currently employed 10.0%
Total Respondents 10
Private Equity
$125,000 ‑ $149,000 20.0%
$150,000 ‑ $174,000 20.0%
$250,000 ‑ $274,000 20.0%
$300,000+ 40.0%
Total Respondents 5
Real Estate
$175,000 ‑ $199,000 50.0%
$200,000 ‑ $224,000 50.0%
Total Respondents 2
Investor relations functionTotal number of respondents: 22
Traditional Asset Manager (independent)
$150,000 ‑ $174,000 100.0%
Total Respondents 1
Multi - Product Asset Manager (independent)
$150,000 ‑ $174,000 50.0%
$175,000 ‑ $199,000 50.0%
Total Respondents 2
Traditional Asset Manager (bank owned)
$125,000 ‑ $149,000 100.0%
Total Respondents 1
Multi - Product Asset Manager (bank owned)
$125‑149k 100.0%
Total Respondents 1
Base Salary
Heidrick & Struggles 129
$125,000 ‑ $149,000 15.4%
$150,000 ‑ $174,000 7.7%
$200,000 ‑ $224,000 23.1%
$225,000 ‑ $249,000 15.4%
$250,000 ‑ $274,000 7.7%
$275,000 ‑ $299,000 7.7%
$300,000+ 23.1%
Total Respondents 13
Product specialist function: all firm types and levelsTotal number of respondents: 13
$100,000 ‑ $124,000 1.9%
$125,000 ‑ $149,000 7.4%
$150,000 ‑ $174,000 18.5%
$175,000 ‑ $199,000 18.5%
$200,000 ‑ $224,000 14.8%
$225,000 ‑ $249,000 14.8%
$250,000 ‑ $274,000 16.7%
$275,000 ‑ $299,000 3.7%
$300,000+ 3.7%
Total Respondents 54
Consultant relations function: all firm types and levelsTotal number of respondents: 54
Base Salary
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 130
Placement Agents: all firm types and levelsTotal number of respondents: 17
< $100,000 11.8%
$100,000 ‑ $124,000 11.8%
$125,000 ‑ $149,000 23.5%
$175,000 ‑ $199,000 17.7%
$200,000 ‑ $224,000 11.8%
$250,000 ‑ $274,000 11.8%
$300,000+ 11.8%
$275,000 ‑ $299,000 3.7%
$300,000+ 3.7%
Total Respondents 17
Base Salary
Heidrick & Struggles 131
Traditional asset managers: sales/fundraising and hybrid sales and investor relationsTotal number of respondents: 37
Bonus
Vice President
< $99,000 66.7%
$100,000 ‑ $199,000 33.3%
Total Respondents 3
Director/Principal
$100,000 ‑ $199,000 12.5%
$200,000 ‑ $299,000 37.5%
$300,000 ‑ $399,000 12.5%
$800,000 ‑ $899,000 12.5%
$1,100,000 ‑ $1,199,000 12.5%
$1,200,000 ‑ $1,299,000 12.5%
Total Respondents 8
MD – Management Role
< $99,000 21.4%
$100,000 ‑ $199,000 7.1%
$200,000 ‑ $299,000 14.3%
$400,000 ‑ $499,000 14.3%
$700,000 ‑ $799,000 7.1%
$800,000 ‑ $899,000 14.3%
$1,000,000 ‑ $1,099,000 7.1%
$1,400,000 ‑ $1,499,000 7.1%
$1,600,000 ‑ $1,699,000 7.1%
Total Respondents 14
Senior Vice President
< $99,000 14.3%
$300,000 ‑ $399,000 28.6%
$400,000 ‑ $499,000 14.3%
$500,000 ‑ $599,000 14.3%
$1,700,000 ‑ $1,799,000 14.3%
$2,000,000 ‑ $2,499,000 14.3%
Total Respondents 7
MD - Individual Contributor
< $99,000 20.0%
$200,000 ‑ $299,000 20.0%
$300,000 ‑ $399,000 20.0%
$1,000,000 ‑ $1,099,000 40.0%
Total Respondents 5
Partner
No Respondents
Bonus
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 132
Multi-product asset managers: sales/fundraising and hybrid sales and investor relations Total number of respondents: 72
Vice President
< $99,000 23.5%
$100,000 ‑ $199,000 29.4%
$300,000 ‑ $399,000 17.7%
$500,000 ‑ $599,000 11.8%
$800,000 ‑ $899,000 5.9%
$1,000,000 ‑ $1,099,000 5.9%
No bonus paid (unemployed) 5.9%
Total Respondents 17
Director/Principal
$100,000 ‑ $199,000 15.4%
$200,000 ‑ $299,000 15.4%
$300,000 ‑ $399,000 23.1%
$400,000 ‑ $499,000 7.7%
$500,000 ‑ $599,000 15.4%
$700,000 ‑ $799,000 15.4%
$800,000 ‑ $899,000 7.7%
Total Respondents 13
MD – Management Role
$100,000 ‑ $199,000 15.4%
$300,000 ‑ $399,000 7.7%
$400,000 ‑ $499,000 23.1%
$500,000 ‑ $599,000 15.4%
$600,000 ‑ $699,000 15.4%
$2,000,000 ‑ $2,499,000 15.4%
No bonus paid (employed) 7.7%
Total Respondents 13
Senior Vice President
Less than $99,000 15.4%
$100,000 ‑ $199,000 15.4%
$200,000 ‑ $299,000 15.4%
$300,000 ‑ $399,000 23.1%
$400,000 ‑ $499,000 7.7%
$1,200,000 ‑ $1,299,000 7.7%
$1,300,000 ‑ $1,399,000 7.7%
No bonus paid (employed) 7.7%
Total Respondents 13
MD - Individual Contributor
< $99,000 7.1%
$100,000 ‑ $199,000 21.4%
$200,000 ‑ $299,000 7.1%
$300,000 ‑ $399,000 14.3%
$400,000 ‑ $499,000 21.4%
$500,000 ‑ $599,000 7.1%
$800,000 ‑ $899,000 14.3%
$1,000,000 ‑ $1,099,000 7.1%
Total Respondents 14
Partner
< $99,000 50.0%
$1,500,000 ‑ $1,599,000 50.0%
Total Respondents 2
Bonus
Heidrick & Struggles 133
Hedge funds: sales/fundraising and hybrid sales and investor relationsTotal number of respondents: 55
Vice President
< $99,000 50.0%
$300,000 ‑ $399,000 50.0%
Total Respondents 2
Director/Principal
< $99,000 12.5%
$100,000 ‑ $199,000 6.3%
$200,000 ‑ $299,000 18.8%
$300,000 ‑ $399,000 18.8%
$400,000 ‑ $499,000 6.3%
$500,000 ‑ $599,000 6.3%
$600,000 ‑ $699,000 6.3%
$700,000 ‑ $799,000 6.3%
$800,000 ‑ $899,000 6.3%
$1,000,000 ‑ $1,099,000 6.3%
No bonus paid (employed) 6.3%
Total Respondents 16
Senior Vice President
$300,000 ‑ $399,000 60.0%
$400,000 ‑ $499,000 20.0%
$800,000 ‑ $899,000 20.0%
Total Respondents 5
MD - Individual Contributor
< $99,000 12.5%
$100,000 ‑ $199,000 12.5%
$300,000 ‑ $399,000 12.5%
$400,000 ‑ $499,000 12.5%
$500,000 ‑ $599,000 12.5%
$800,000 ‑ $899,000 12.5%
$1,000,000 ‑ $1,099,000 12.5%
$3,000,000 ‑ $3,499,000 12.5%
Total Respondents 8
Partner
$200,000 ‑ $299,000 14.3%
$600,000 ‑ $699,000 14.3%
$1,000,000 ‑ $1,099,000 14.3%
$1,100,000 ‑ $1,199,000 28.6%
$1,800,000 ‑ $1,899,000 14.3%
No bonus paid (employed) 14.3%
Total Respondents 7
MD – Management Role
< $99,000 5.9%
$100,000 ‑ $199,000 11.8%
$200,000 ‑ $299,000 11.8%
$400,000 ‑ $499,000 5.9%
$500,000 ‑ $599,000 5.9%
$700,000 ‑ $799,000 11.8%
$900,000 ‑ $999,000 5.9%
$1,000,000 ‑ $1,099,000 11.8%
$1,200,000 ‑ $1,299,000 5.9%
$1,300,000 ‑ $1,399,000 5.9%
$1,700,000 ‑ $1,799,000 5.9%
$2,500,000 ‑ $2,999,000 5.9%
No bonus paid (unemployed) 5.9%
Total Respondents 17
Bonus
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 134
Private equity: sales/fundraising and hybrid sales and investor relations Total number of respondents: 11
Vice President
$100,000 ‑ $199,000 100.0%
Total Respondents 1
Director/Principal
$200,000 ‑ $299,000 25.0%
$300,000 ‑ $399,000 25.0%
$400,000 ‑ $499,000 25.0%
$600,000 ‑ $699,000 25.0%
Total Respondents 4
MD – Management Role
< $99,000 50.0%
$500,000 ‑ $599,000 50.0%
Total Respondents 2
Senior Vice President
No Respondents
MD - Individual Contributor
< $99,000 50.0%
$300,000 ‑ $399,000 50.0%
Total Respondents 2
Partner
$300,000 ‑ $399,000 50.0%
$1,800,000 ‑ $1,899,000 50.0%
Total Respondents 2
Bonus
Heidrick & Struggles 135
Real estate: sales/fundraising and hybrid sales and investor relationsTotal number of respondents: 9
Vice President
No Respondents
Director/Principal
< $99,000 50.0%
$200,000 ‑ $299,000 25.0%
No bonus paid (unemployed) 25.0%
Total Respondents 3
MD – Management Role
No bonus paid (employed) 100.0%
Total Respondents 1
Senior Vice President
$100,000 ‑ $199,000 100.0%
Total Respondents 2
MD - Individual Contributor
< $99,000 33.3%
$300,000 ‑ $399,000 33.3%
$1,000,000 ‑ $1,099,000 33.3%
Total Respondents 3
Partner
No Respondents
Bonus
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 136
Investor relations functionTotal number of respondents: 22
Hedge Fund
$100,000 ‑ $199,000 20.0%
$200,000 ‑ $299,000 30.0%
$400,000 ‑ $499,000 10.0%
$700,000 ‑ $799,000 10.0%
No bonus paid (employed) 10.0%
No bonus paid (unemployed) 20.0%
Total Respondents 10
Private Equity
Less than $99,000 20.0%
$100,000 ‑ $199,000 20.0%
$200,000 ‑ $299,000 20.0%
$300,000 ‑ $399,000 20.0%
$500,000 ‑ $599,000 20.0%
Total Respondents 5
Real Estate
$100,000 ‑ $199,000 50.0%
$200,000 ‑ $299,000 50.0%
Total Respondents 2
Traditional Asset Manager (independent)
< $99,000 100.0%
Total Respondents 1
Multi - Product Asset Manager (independent)
$300,000 ‑ $399,000 100.0%
Total Respondents 2
Traditional Asset Manager (bank owned)
$100,000 ‑ $199,000 100.0%
Total Respondents 1
Multi - Product Asset Manager (bank owned)
$100,000 ‑ $199,000 100.0%
Total Respondents 1
Bonus
Heidrick & Struggles 137
Product specialist function: all firm types and levelsTotal number of respondents: 13
< $99,000 7.7%
$100,000 ‑ $199,000 15.4%
$200,000 ‑ $299,000 38.5%
$400,000 ‑ $499,000 7.7%
$600,000 ‑ $699,000 7.7%
$800,000 ‑ $899,000 15.4%
$1,000,000 ‑ $1,099,000 7.7%
Total Respondents 13
Consultant relations function: all firm types and levelsTotal number of respondents: 53
< $99,000 5.7%
$100,000 ‑ $199,000 20.8%
$200,000 ‑ $299,000 35.9%
$300,000 ‑ $399,000 15.1%
$400,000 ‑ $499,000 5.7%
$500,000 ‑ $599,000 3.8%
$600,000 ‑ $699,000 3.8%
$700,000 ‑ $799,000 3.8%
$800,000 ‑ $899,000 1.9%
No bonus paid (employed) 1.9%
No bonus paid (unemployed) 1.9%
Total Respondents 53
Bonus
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 138
Placement agents: all firm types and levelsTotal number of respondents: 18
< $99,000 33.3%
$100,000 ‑ $199,000 5.6%
$200,000 ‑ $299,000 11.1%
$300,000 ‑ $399,000 5.6%
$500,000 ‑ $599,000 11.1%
$700,000 ‑ $799,000 16.7%
$1,300,000 ‑ $1,399,000 5.6%
No bonus paid (unemployed) 5.6%
Total Respondents 53
Bonus
Heidrick & Struggles 139
Do MBAs earn more?For a bit of fun, we explored how the compensation of distribution professionals with MBAs compares to those without MBAs. Since virtually all of our survey respondents are at the vice president level and above, we feel confident that most individuals have either pursued an MBA or decided against it by this point in their career.
Because our survey captured base and bonus levels in a range format rather than raw numbers, we looked at the percentage of individuals reporting compensation within each respective range.
Interestingly, we noticed a meaningful difference in base salary but not so much on the bonus. For base salary, there is clearly higher representation of MBAs in the higher ranges ($225,000+). For bonuses, there is a higher representation of MBAs in the $500,000 to $1.1 million range, but there is little differentiation beyond that, perhaps due to a much smaller sample size. We plan to collect raw numbers in future studies in order to present a clearer view on compensation overall.
Base Salary
0%
20%
40%
60%
80%
100%
120%
0%
5%
10%
15%
20%
25%
30%
$300
,000
+
$275
,000
- $2
99,0
00
$250
,000
- $2
74,0
00
$225
,000
- $2
49,0
00
$200
,000
- $2
24,0
00
$175
,000
- $1
99,0
00
$150
,000
- $1
74,0
00
$125
,000
- $1
49,0
00
$100
,000
- $1
24,0
00
<$10
0,00
0
Not
cur
rent
ly e
mpl
oyed
MBA Bachelors
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 140
Bonus
0%
20%
40%
60%
80%
100%
120%
0%
5%
10%
15%
20%
25%
30%
$4,0
00,0
00+
$3,5
00,0
00 -
$3,5
99,0
00
$3,0
00,0
00 -
$3,4
99,0
00
$2,5
00,0
00 -
$2,9
99,0
00
$2,0
00,0
00 -
$2,4
99,0
00
$1,9
00,0
00 -
$1,9
99,0
00
$1,8
00,0
00 -
$1,8
99,0
00
$1,7
00,0
00 -
$1,7
99,0
00
$1,6
00,0
00 -
$1,6
99,0
00
$1,5
00,0
00 -
$1,5
99,0
00
$1,4
00,0
00 -
$1,4
99,0
00
$1,3
00,0
00 -
$1,3
99,0
00
$1,2
00,0
00 -
$1,2
99,0
00
$1,1
00,0
00 -
$1,1
99,0
00
$1,0
00,0
00 -
$1,0
99,0
00
$900
,000
- $9
99,0
00
$800
,00 0
- $8
99,0
00
$700
,000
- $7
99,0
00
$600
,000
- $6
99,0
00
$500
,000
- $5
99,0
00
$400
,000
- $4
99,0
00
$300
,000
- $3
99,0
00
$200
,000
- $2
99,0
00
$100
,000
- $1
99,0
00
Less
than
$99
,000
No
bonu
s pai
d (e
mpl
oyed
)
MBA Bachelors
Heidrick & Struggles 141
Track record of cultivating long-term relationships within key client channels or geographies
Considers investors’ needs holistically; o�ers solutions rather than a product-centric sales approach
Entrepreneurial by nature; passionate about building and growing the business
Demonstrates patience, calm and commitment to outstanding service during client interactions
Willing to serve as a mentor
Straight shooter; communicates without spin, evasiveness or excessive storytelling
Proactive and transparent communication during periods of fund underperformance or key-person changes
Combines strong strategic ability with tactical skills in approaching the market
Superior written, verbal and interpersonal communication skills; able to present with con�dence and in�uence
Strong academics including MBA and / or CFA
Quanti�able track record of raising capital successfully throughout di�erent economic cycles
Highly responsive; provides thoughtful, substantive and consistent follow-up
Strong work ethic and competitive spirit coupled with good sportsmanship and collaboration
Communicates with genuine passion, energy and excitement
Willing and able to discuss products and solutions beyond a speci�c product o�ering
Able to articulate and position complex strategies e�ectively to a range of investors and consultants
Demonstrates ownership and self-awareness around missteps and lessons learned from the experience
Serves as a calm, trusted advisor during challenging times
Great judgment about leveraging the investment team(s)
Professional behavior; consistently demonstrates strong values in business as well as social settings
Demonstrated loyalty and tenure throughout their career
Culture �t
Able to master a speci�c product o�ering as well as understand a �rm’s full range of capabilities across strategies
Demonstrates respect for investors’ time; skilled at running meetings e�ciently, communicating concisely and listening
Career history of growth and success in roles of increased complexity and responsibility
Manages expectations, communicates proactively, meets deadlines
Willing to address di�cult situations proactively
Analytical / technical depth
Long-term focus on building trust, respect and credibility with investors
Agile thinker; able to adapt quickly and calmly to shifting priorities and demands
Truly collaborative and team-oriented
Characteristics of an Outstanding
Distribution Professional
The outstanding distribution professional possesses a unique mix of qualities, characteristics and experiences. We pieced together this “portrait” from a variety of sources, including:
- allocator feedback during referencing and sourcing- commonalities among the “wish lists” from our clients regarding the ideal candidate pro�le- Heidrick & Struggles interview observations
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 142
Emerging Trends for 2014 and BeyondSurvey participants shared more than 200 responses to the question “What Key Themes Do You See Emerging in 2014 and Beyond?”
The most common themes were:
• Redefinition of the role of alternatives within a portfolio; discussions about solutions, not just products; greater flexibility and creativity.
• Negative impact of rising interest rates.
• Further convergence of traditional and alternative investments.
• Further convergence of institutional and high-net-worth investors.
• Pressure on transparency, fees, compliance, liquidity.
• Further industry consolidation and M&A activity.
• Increased competitive advantage of larger firms.
• Increased attention on individuals with technical skills over generalists for sales professionals.
• Continued rise of OCIO.
• Continued growth of influence by consultants and corresponding rise of consultant-relations specialist roles.
Other themes that emerged include:
• Greater emphasis on disciplined investment process vs. black box model.
• More stable but equally competitive environment for fundraising.
• The rise of product specialist and client-facing investment roles.
• Talent retention issues at the largest firms, fund of funds and single-strategy hedge funds.
• Continued use of liquid alternatives.
• Continued growth of managed accounts and customization.
• Continued move to LDI.
• Fund closures due to underperformance and/or increased cost of doing business.
• Ongoing debate around emerging markets.
• Continued movement from formulaic to discretionary compensation models.
• More sales professionals familiar with multi-asset portfolio construction.
Heidrick & Struggles 143
Topics for Further Exploration
At the close of our survey we asked participants to offer suggestions for potential future thought leadership reports. We received more than 100 suggestions covering a variety of ideas.
The most common themes were:
• Talent cultivation, retention and compensation
• Succession planning and firm leadership
• Convergence of traditional and alternative investments—how are firms navigating?
• Evolution of the business overall
• Product Specialist role
Other themes that emerged include:
• Client retention
• How to expand a distribution effort globally
• Career management (differentiation, skills, networking)
• Compensation (more granular view overall, alignment of interests, commission vs. discretionary, equity participation)
• Components of a successful asset management firm
• Innovation within the asset management industry overall and within distribution teams specifically
• How can small firms scale?
• Impact of regulation on the industry (managers and investors)
• Solutions vs. product-centric sales approach
We will endeavor to share our views on these topics through future reports and roundtable breakfasts. In addition,
Heidrick & Struggles’ search consultants partner closely with our Leadership Advisory colleagues and those at our
culture-shaping subsidiary, Senn Delaney. Please reach out if you wish to discuss a customized consulting project.
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 144
Survey Methodology
Heidrick & Struggles sent an online questionnaire to 2,394 asset management distribution professionals. A total of 495 recipients participated in the survey, a 20.8% response rate. However, the number of participants who answered a given question varied widely from question to question, as noted throughout the report.
Below is a summary of demographic information about our survey population.
What is your current job title?
Answer Options Response Percent Response Count
Associate 0.4% 2
Senior Associate 0.7% 3
Vice President 14.4% 65
Senior Vice President 13.3% 60
Director/Principal 23.9% 108
Managing Director (individual contributor) 16.2% 73
Managing Director (management role) 19.3% 87
Partner 8.2% 37
N/A - Not currently employed 3.5% 16
Other (please specify) 53
answered question 451
How many years of total work experience do you have?
Answer Options Response Percent Response Count
5 - 10 5.1% 25
11 - 15 21.0% 103
16 - 20 24.0% 118
21 - 25 27.5% 135
26+ 22.4% 110
answered question 491
How many years of asset management distribution experience do you have?
Answer Options Response Percent Response Count
5 - 10 30.8% 150
11 - 15 28.1% 137
16 - 20 22.2% 108
21 - 25 13.3% 65
26+ 5.5% 27
answered question 487
Heidrick & Struggles 145
Where do you work?
Answer Options Response Percent Response Count
New York 53.3% 233
Connecticut 7.1% 31
Boston 9.6% 42
Chicago 12.1% 53
San Francisco 7.1% 31
Los Angeles 5.3% 23
Minneapolis 0.7% 3
Philadelphia 3.0% 13
Miami 0.2% 1
Houston 0.0% 0
Dallas 0.9% 4
Washington, D.C. 0.7% 3
Other (please specify) 63
answered question 437
How would you characterize your current firm?
Answer Options Response Percent Response Count
Traditional Asset Manager (independent) 15.2% 69
Traditional Asset Manager (bank-owned) 5.9% 27
Multi-Product Asset Manager (independent) 22.0% 100
Multi-Product Asset Manager (bank-owned) 11.5% 52
Hedge Fund 20.9% 95
Private Equity 6.4% 29
Hedge Fund of Funds 3.3% 15
Private Equity Fund of Funds 1.5% 7
Real Estate 5.1% 23
Placement Agent 5.9% 27
OCIO 2.2% 10
Other (please specify) 47
answered question 501
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 146
Which investment products are offered by your current firm (check all that apply)?
Answer Options Response Percent Response Count
Long-Only Equity 51.1% 242
Long-Only Fixed Income 44.5% 211
Hedge Funds 54.6% 259
Private Equity 33.3% 158
Hedge Fund of Funds 22.8% 108
Private Equity Fund of Funds 17.3% 82
Real Estate 36.7% 174
Commodities 21.3% 101
Infrastructure 18.8% 89
Other (please specify) 60
answered question 474
If your firm is a hedge fund, what is its primary investment strategy?
Answer Options Response Percent Response Count
Long-short equity 27.0% 44
Long bias 3.7% 6
Credit 23.9% 39
Event-driven 9.2% 15
Arbitrage 1.8% 3
Global macro 11.0% 18
Relative Value 1.8% 3
CTA/Managed futures 3.7% 6
Multi-strategy 17.8% 29
Other (please specify) 26
answered question 163
Heidrick & Struggles 147
What are the total assets under management of your current firm?
Answer Options Response Percent Response Count
<$200mln 4.4% 20
$200mln - $500mln 5.9% 27
$500mln - $1bln 3.7% 17
$1bln 5.5% 25
$2bln 4.1% 19
$3bln 3.7% 17
$4bln 2.8% 13
$5bln 2.0% 9
$6bln 1.3% 6
$7bln 2.8% 13
$8bln 0.9% 4
$9bln 1.5% 7
$10bln 2.4% 11
$11bln 1.3% 6
$12bln 2.2% 10
$13bln 0.4% 2
$14bln 0.7% 3
$15bln 0.9% 4
$16bln 0.7% 3
$17bln 0.2% 1
$18bln 1.1% 5
$19bln 0.4% 2
$20bln - $29bln 7.9% 36
$30bln - $39bln 2.4% 11
$40bln - $49bln 3.7% 17
$50bln - $59bln 2.4% 11
$60bln+ 34.9% 160
Other (please specify) 16
answered question 458
Talent and Compensation Trends in Asset Management Distribution Mid-Year Review 148
How would you characterize the primary focus of your current role?
Answer Options Response Percent Response Count
Sales / Fundraising 53.4% 243
Investor Relations / Client Service (client-facing) 9.2% 42
Investor Relations / Client Service (non-client-facing / support) 0.9% 4
Hybrid Sales and Investor Relations 17.8% 81
Product Specialist 4.6% 21
Consultant Relations 14.1% 64
Other (please specify) 55
answered question 455
Did you change firms during the past 3 years?
Answer Options Response Percent Response Count
Yes 50.1% 190
No 49.9% 189
answered question 379
Heidrick & Struggles 149
Our Global Team
Americas
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Chad Astmann New York
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Paul Gibson New York
Amy Goldfinger New York
Jonathan Goldstein New York
Renee Neri New York
Liz Simpson New York
Laurie Thompson New York
Paul Charles San Francisco
Lee Hanson San Francisco
Rose Baker Toronto
Daniel Edwards Washington, D.C.
Jean AllenNew York
Our Expertise:
• Senior leadership
• Investment professionals
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• Technology & operations
• Investor relations
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Our Clients:
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EMEA
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Heidrick & Struggles is the premier provider of senior-
level Executive Search, Culture Shaping and Leadership
Consulting services. For 60 years, we have focused on
quality service and built strong leadership teams through
our relationships with clients and individuals worldwide.
Today, Heidrick & Struggles’ leadership experts operate
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