Compensation of Private Equity Professionals in Brazil (Spectra Investments)

Summary

• Brazil had 200 PE and VC GPs in 2019, with committed capital of R$198.1 billion, more than 3 times the R$63.5 billion of 2011.p.2
• The study is based on interviews with 25 Brazilian private equity managers.p.3
• About 60% of total compensation is variable for senior positions from principal to partner, and about 50% for junior categories.p.4
• The average partner earns four times the average associate: R$2 million per year versus R$500 thousand per year.p.4
• Of 15 managers answering, 53% set carry points per position, and 57% have a vesting period averaging 5.5 years.p.8
• Women are only 13% of the 164 professionals analysed, and 10% of the women analysed are partners.p.9

Key insights

1. Carry is paid on a fund-as-a-whole basis in 70% of the managers interviewed.p.7
2. The average and median hurdle rate for funds raised with local investors is 6%.p.7
3. Management fees of about 2% a year of committed capital finance salaries and bonuses, so smaller managers pay less fixed compensation.p.5
4. The average vesting period for carry is 5.5 years, with a maximum of 10 and a minimum of 3 years.p.8
5. Only 1 manager declared no vesting period for carry.p.8
6. Of the 164 professionals investigated, only 13% are women, and 15% of the managers have no women on the team.p.9
7. Of the managers interviewed, 26% remunerate in dollars and 74% in reais.p.4