The Funds Partnership Asia’s Salary Guide 2020 : Private Equity Investments

12 Mar 2020

Director’s Note

So much has changed in 12 months since we last wrote our 2019 salary guide! We are now on the brink of a global pandemic and witnessing the largest work from home experiment in the world! In June 2019, in addition to the trade war uncertainties, we saw the Hong Kong spring of protestors who took to the streets creating a new dimension of political uncertainty in Hong Kong which has affected the confidence of investors.

Although 2019 started off very positively much like 2018, the above-mentioned uncertainties have hindered investment activity for our clients particularly in the second half of the year. The mutual tariffs imposed due to the US-China trade war affected the real economy, killed demand and affected real suppliers in China. This created more bad debts in China affecting the performance of fixed income portfolio managers especially those focused on the Hong Kong and Chinese market. As a result, there were increased redundancies for this asset class. However, interestingly, this gave rise to private debt fund managers who emerged promising to restructure private company debts and in some cases, we saw traditional bond houses build their private debt teams. Hence, the demand for professionals with restructuring and debt investment skills was higher than in previous years.

With the above in mind, we are not at all surprised that 70% of all our hiring was in the family office, private markets space. Despite all the uncertainties, Asia can still boast over 15 trillion of AUM and we still expect the funds industry to grow in Asia and meet the PWC estimation of hitting 29 trillion of AUM by 2025 resulting in good job growth across Asia. In Singapore, we anticipate many new jobs will be created due to the newly developed Variable Capital Company (VCC) regime introduced by MAS which looks set to create at least 10,000 new jobs by 2030. We are anticipating more jobs to relocate to Singapore and remain optimistic.

Market Overview

The steady inflow of new venture capital and private equity (PE) funds entering the market contributed to the high investment activities in 2019. We noticed an increase in hiring in South East Asia (SEA) compared to North Asia and we believe that this trend will continue well into 2021. Though the uncertainty in North Asia (e.g protests in Hong Kong, repercussions of the US-China trade war, macroeconomic disruptions in China, etc) has spurred asset managers to relocate their investment headquarters to Singapore, we still see a large number of our clients raise funds and set up new fund management companies in tier 1 cities in China. That said, the hiring pace in Hong Kong has nonetheless slowed down immensely as fund managers and investors have currently set their sights on Singapore.

We have also noticed an increase in the number of funds looking to diversify their portfolio to increase investors’ appetites for new funds. For example, some of our Real Estate clients have expanded into digital infrastructure assets and our traditional PE funds have started building private debt teams. We have also seen financial institutions begin to build GP stakes strategies which is becoming quite popular. With the above trends, the demand for Analysts / Associates has continued to soar to an all time high.

An interesting hiring trend we have also witnessed is the increasing demand for creative Fundraisers. On a macro scale, the disparity of large size funds and small, inexperienced funds are growing: the bigger names are dominating the region whilst the smaller funds are having difficulty raising money and exiting. From our clients, we have observed more interests to raise funds mainly from Japan and Korea, with small activities in Vietnam too. A notable quality that investors are looking for in Fundraisers is their innovative thinking and creativity in structuring the funds when speaking to potential investors.

Salary Guide

Read the pdf version of the Funds Partnership Asia’s Salary Guide for Private Equity Investments here:

Funds Partnerships Asia Salary Guide 2020: Private Equity Investments

 

To find out more about the Private Equity Investments industry, please contact:

Robert Hayward

Principal Consultant

robert@fundspartnership.com