Let’s start with a reminder for anyone wanting to showcase their firm’s achievements in 2019: there is still time to submit to the PEI Awards. Here is where and how to do it.
We’ll soon be bringing you some insight into private fund CFO compensation packages, courtesy of the Holt-MM&K-Buyouts PE/VC Compensation Report. You can buy the report here and sign up to participate in next year’s study.
In the meantime, ahead of more detailed reporting, we can tell you that salaries have jumped across the industry. As the editor of sister title Buyouts, Chris Witkowsky, puts it: “Median salary for partners increased 11 percent from 2018 to 2019 across the industry, the survey found. Partner salary and bonus shot up 13 percent, while salary, bonus and carried interest rose 30 percent.”
On Private Funds CFO today, we have an extract from our 2017 book The Definitive Guide to Carried Interest, in which ILPA managing director Jen Choi discusses LPs’ desire for transparency when it comes to carry.
If you are interested in getting creative with your economic alignment, Lexington Partners’ latest secondaries fund (targeting $12 billion) might provide some inspiration. The GP gets 10 percent carry after a 7 percent hurdle. Beyond a 10 percent hurdle, the carry jumps up to 12.5 percent. Catch-up is 100 percent. Management fee breaks are on offer for early bird investors, as well as those making larger commitments. Sister title Secondaries Investor has all the details.
Email prepared by Toby Mitchenall