What Discounts Should Be Offered to Early LPs: Management Fee or Carry Discount and How Much?

We strongly recommend that you do not discount your fees. You normally discount fees through a Side Letter, and Side Letters are public to other Limited Partners. So, every Limited Partner will ask for a similar deal, which places you in a bad negotiating position. If you want to offer something, offer a discount on SPVs to invest in your follow-on into portfolio companies, and you can offer this as a handshake agreement.