Put Your Money Where Your Mouth Is

What amount is the right amount for the General Partner commitment? Put simply, it should be a meaningful amount of your net worth that will keep you motivated and hungry to make sound investment decisions. This rule should flow through the investment team, not just the top one or two partners in the shop. Don’t underestimate the power of a strong GP commitment, particularly when negotiating management fees and carry with investors. Remember, the goal is to create an alignment of interests. Putting your own capital in the game may influence others to do the same.

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