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Performance Fees
Performance Fees or Carry is typically defined as the percentage share in profits payable to the General Partner. A good waterfall policy can go a long way to align the interests of General Partners with Limited Partners. With Fundwave, you can define a common layered performance fees policy for the fund and override it for individual investors.


Here's how to add a performance fees policy for the fund:


  1. On the fund dashboard, select 'Waterfall Policy' from the left menu.


  2. Select Waterfall type - Fund as a whole or Deal by Deal method.

    1. Fund as a Whole waterfall - Undrawn commitment check, which assumes all undrawn commitment is valued at zero before a carry is distributed



  3. For a simple single layer policy, Enter the following details:
    1. Preferred Return type - Percentage or Multiple.
    2. Preferred return rate, expressed as a percentage or multiple.
    3. Calendar Type - applicable financial calendar.
    4. Compounding Type - Annual or None, as required
    5. Compounding Date - Date on which interest is to be calculated in Month-Date format.
    6. Carried Interest Rate, expressed as percentage.
    7. GP Catch-Up Rate, expressed as percentage.
    8. Priority - Define priority of layer. (Only for multiple layer waterfall policy)

  4. For a more complex layered waterfall policy for your fund, Click 'Add Layer' button to add a new layer.
    Add as many layers and define them as required.


  5. Click on the 'Save' button to save your waterfall layer policy.


All investors will default to this waterfall policy. To override this policy for any investor, see this guide.