Assume that you have started a fund that makes 4 investments over its lifespan.

Portfolio company 1; $80mn in Year 1

Portfolio company 2; $100mn in Year 1

Portfolio company 3; $40mn in Year 2

Portfolio company 4; $75mn in Year 3

Assume the following fund terms: (i)Hurdle rate = 10% p.a (ii)Carried Interest = 20% (iii)No management fees for the fund period

Exit each portfolio company in 7 years for the following sale amounts:

Portfolio company 1; $360mn

Portfolio company 2; $250mn

Portfolio company 3; $280mn

Portfolio company 4; $400mn

All capital first scenario

1. Calculate the MoMx for each investment
2. Perform and calculate all the Distribution steps for this scenario
3. Would you say that the fund has performed well? Why or why not?

Deal-by- deal scenario

1. Perform and calculate all the distribution steps for each portfolio company investment
2. Which portfolio company investment has performed the best? Why?
3. Would you say that the fund has performed well? Why or why not?