How to Accrue Early Non-Realized Performance for Late LPs in a Fast-Closing Context?

It appears that the limited partner is asking for there to be a penalty or catch-up fee for late entrants into the fund. You can simply response that you are not adding any penalties or catch up fees, as you your intention is to close quickly and keep fund admin complexity to a minimum. With most smaller funds the costs of administering such programs can be high, and, worse, the programs scare aware qualified LPs. In general, we strongly discourage this until you are an established fund manager with top returns.