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Randy Castleman's avatar

I'm glad you shed some light on this. It's one of a class of fund terms that has nuances (many of which you point out) but usually gets the one-size-fits-all treatment. Another is the arbitrary "7-9%" preferred return (for funds that have them) which is somehow still market in a world with negative interest rates and double-digit public equities returns. Despite the opportunities for improvement (and alignment), many GPs are understandably reluctant to get clever with any of these lest they scare off LPs with "non-standard" terms.

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Ubiquity Ventures's avatar

Great post!

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