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Making LPAs more akin to contracts between fund managers and their portfolio company execs would lead to better GP-LP alignment.
Fees remain a bone of contention for limited partners as fund sizes continue to grow.
Investors are forcing funds to take disclosure to a whole new level of detail, with broken deal expenses one of the most contentious areas.
In a heady fundraising environment, GPs are pushing fund terms in their favor, and it’s up to LPs to walk them back, Texas Municipal Retirement System’s director of private equity Christopher Schelling says.
For all the debate it provokes, the conventional hurdle rate has remained stubbornly untouched since the ’80s.
Institutional clients will receive ‘tens of millions’ of dollars as the majority of the fund manager’s investments meet or outperform objectives.
With managers increasingly putting pressure on LPs to enter the carry early, Threadmark partner Patricia Wilkinson and PEI senior editors Bruno Alves, Jonathan Brasse and Toby Mitchenall look across asset classes to find out whether the status quo really is changing.
With the promise of outsized returns comes the expectation of outsized compensation.
Some GPs are opting to bypass pensions that demand disclosures around fees and expenses, but they may find LPs have long memories.
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