Could the independent/fundless sponsor model and fee structure be applied to VC? Have any of you done it, or have you seen it in the industry?
In independent sponsor PE deals there is typically a closing fee (e.g. 2% of EV, or 0.5%-2% of the purchase price), a management fee (fixed or small % of EBITDA), and the independent sponsor's upside participation, which is the largest component of the compensation package. Theoretically all these could be applied in VC deals, with the closing fee obviously being a much smaller component in relative terms.
Would be great to hear from people who know/understand more about this...