What would generous carry be defined as for a first-time fund of $100m? Specifically for the VP and up level?
Assume GP previously operated as an independent sponsor with a good track record so not quite as risky as a true first time fund.
Based on a few people I've talked to, it seems like founders are trying to keep too much for themselves but not sure.
Seems to make sense to be aggressive about giving out carry for fund 1 since that team is what serves as the foundation to launch fund 2, fund 3, etc.
Thanks!
Are you taking any fundraising risk or the fund is closed and ready to deploy?
If fund is closed and you’re signing up as W2 employee form day 1, I’d think anywhere from 2-5%. You want to push to higher end and above that if you’re taking meaningful closing risks and/or taking sweat equity.
Assume fund is closed/good to go.
In that case I would think like 2-3% or so. For me I joined at the bottom when there was no fund and we had to fundraise and build the business from the ground up.
I'll bite as I was in this exact situation. Was a day 1 first employee at an independent sponsor. We ran deal by deal for 5 years and then raised a 100mm fund. Founder kept 90%, I got 7.5% as a director, and a Sr associate who was there for a few years got 2.5%.
So, probably 5% is reasonable.
At my new gig it is a similiar situation and my carry is 10% but with a 7 year vest.
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