Question
Lion Ventures II is a 10-year VC fund with committed capital of $200M. Its annual management fee is 2.5% of committed capital for the first
Lion Ventures II is a 10-year VC fund with committed capital of $200M. Its annual management fee is 2.5% of committed capital for the first half of the fund's life, and 2% of net invested capital for the second half of the fund life. Fees are collected once a year on the first day of the year before any investments or exits are made for that year. Further assume that, on the last day of each of years 6-10, 20% of investment capital is realized so that all investments are exited by the end of year 10. What are the lifetime fees and investment capital of the fund?
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