0
Fund Closing

How much does Decile Launch cost?

Asked by:
Community Member
1
0
1
May 03, 2023
How much does Decile Launch cost?
1 answer
Accepted Answer
May 03, 2023
Please read this for more information regarding Decile Launch, including the cost:

https://govclab.com/2023/05/26/meet-decile-launch/
Regarding the 1% carried interest component for the cost of Decile Launch - is it a) 1% of the GP's 20% carry, or b) 1% of the 100% of fund profit?

E.g. Let's say the profit of the fund is $10M. 

a) GP's carry is 20% of $10M ($2M). Is the cost 1% of $2M = $20,000? Or
b) 1% of $10M = $100,000?
Apr 01, 2024 8:47pm
It's 1% of 20% or 5% of 100%. So, if your carry is $2m (100%) the Partner carried interest is $100k. 

This way, the incentives are aligned because it generally takes 10 - 15 years for the carry to be realized. So you would need to be ultra ULTRA successful for the carry to materially be worth the value provided by the team. Another way to think about it, if the Partner's carry is $100k, we likely would have provided a multiple of that value by that point.
Apr 01, 2024 9:24pm
I think you meant to say 1% of 100% (1% of $10M = $100K) or 5% of 20% (5% of $2M = $100K), right? Just want to be sure! 
Apr 02, 2024 3:26pm
Assume the carry is 100%. It's 5% of 100%. 
Apr 02, 2024 3:29pm
Add a comment

Log In or Sign Up

Please Log In, or Sign Up to participate in the discussion.

Apply to VC Lab Cohort 15

Get full access to Decile Base and the Decile Hub venture platform for free by joining the VC Lab program.

Apply to VC Lab Cohort 15