2. Aggie Partners is raising their first fund, Aggie Partners Fund I, with $200M in committed...

Transcribed Image Text:

2. Aggie Partners is raising their first fund, Aggie Partners Fund I, with $200M in committed capital, annual management fees of 1.75 percent, carried interest of 20 percent, and a carried interest basis of committed capital. The three individuals on the Aggie team have previously managed the captive VC portfolio for the Presidio family. During the 10 years of managing the Presidio's VC portfolio, the partners did not charge management fees or carried interest, and they achieved an unknown GVM equal to K. a. For any given K, solve for the carried interest, value multiple, and GP%. b. How large must K be for the value multiple to be greater than 3? C. How would your answer to parts (a) and (b) change if the carry basis were equal to investment capital? 2. Aggie Partners is raising their first fund, Aggie Partners Fund I, with $200M in committed capital, annual management fees of 1.75 percent, carried interest of 20 percent, and a carried interest basis of committed capital. The three individuals on the Aggie team have previously managed the captive VC portfolio for the Presidio family. During the 10 years of managing the Presidio's VC portfolio, the partners did not charge management fees or carried interest, and they achieved an unknown GVM equal to K. a. For any given K, solve for the carried interest, value multiple, and GP%. b. How large must K be for the value multiple to be greater than 3? C. How would your answer to parts (a) and (b) change if the carry basis were equal to investment capital?

Answer rating: 100% (QA)

a To solve for the carried interest value multiple and GP we need to make some assumptions Lets assu... View the full answer