Paid In Full: Understand Your Investment Team’s Compensation

The private fund industry continues to grow at a record pace, with $9.2 trillion under management as of March 2021. As the industry has grown, private fund principals and employees have become increasingly well compensated through a variety of sources, including salary, bonus, long-term incentive plan (LTIP) compensation, fund co-investment participation, and carried interest awards. To retain and recruit talented individuals, private fund sponsors are well served by ensuring their team members are appropriately compensated. Likewise, as the marketplace has become ever more competitive for top talent, private fund sponsors must consider appropriate conditions and restrictions to protect their interests in connection with departures. This two-part series addresses the legal aspects of private investment fund compensation arrangements for their investment teams.

READ NOW »

Related Content

• Private Investment Fund Team Compensation Arrangements: Continuity Considerations
  Check out the second part of this two-part series addressing legal and economic consequences for private investment fund compensation arrangements when a member of an investment team departs.

• Management Agreement for a Private Equity Fund
  Consult this management agreement template to ensure that the members of your investment team receive appropriate fees from the fund(s) they advise.
  
  
• Management Incentive Equity in Private Equity Transactions
  Read how your investment team isn’t the only group of individuals getting paid—incentive equity, if structured correctly, can ensure that your portfolio company management team’s interests are aligned with those of the sponsor’s investment team.

Practical Guidance Updates 
Featuring the latest updates from your Practical Guidance account. 

• SUMMER RESOURCES: Share fundamental guidance with your firm’s summer associates to help them sharpen their research and writing skills, get the inside scoop on summer associate survival, and hit the ground running in investment management. Review the resources in the Summer Associate Resource Kit: Investment Management
• The Practical Guidance Journal Summer 2022 Edition features insights on ransomware, cybersecurity, and oil & gas industry trends.
• Listen Up! The Practical Guidance Podcast features interviews with industry-leading attorneys on cutting edge issues in the law: NFTs, Cannabis, COVID-19, and more.

Experience results today with practical guidance, legal research, and data-driven insights—all in one place.

Experience Lexis+