PE Carry London

I see both of you are confused. There will be a vesting schedule on shadow carry (which will mimic real carry in most aspects). The key difference is that once you are due to start receiving proceeds on your vested portion as the fund gets into carry (after 8 years), with shadow carry they have no contractual obligation to pay you out if you are not at the firm anymore (it is a purely discretionary remuneration scheme that so happens to mimic carry), whereas for real carry it is much harder to not pay you out (you will see the money even if not at the fund anymore, there are some clauses to fuck you but much much harder to action). Given European funds are on European waterfalls which take 8 years to get into carry, for you to actually realise your shadow carry you need to stick with the firm for 8+ years, which despite the better culture and WLB present in European funds is not a realistic base case. So when you hear shadow carry just think of funny money or write it down to 0.

The proceeds are not just on vested portion - vesting accelerates upon realization. vesting has to do with what you retain. You're generally right but many funds do indeed let you keep shadow carry. It's fund specific and people should ask when interviewing not read random threads here. For example some funds will also change waterfall for shadow carry. Much more nuanced than this thread.