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Venture Capital management fees: VentureSouth's practices

Paul Clark
Paul Clark
Last updated: June 4, 2024
Venture south fallback

What would VentureSouth do?

A fair follow-up question on these posts on venture capital fund management fees is: so what does VentureSouth do?

You hopefully will not be surprised to learn that we use the step-down approach on our sidecar funds: a percentage of committed capital during the investment period, then a percentage on (net) invested capital during the harvesting period.

In VentureSouth Angel Fund I, which was the first fund and very small (<$2M), the percentage was 2.5%.

As the funds have grown and we have leveraged operational efficiencies ā€“ both within the funds and across VentureSouth ā€“ later funds have been 2% using the step-down approach.

As we said, we think this is the most reasonable approach, and we try to practice what we preach.