How does carried interest work for Rolling Funds?

Distributions are paid by a fund that realizes a return to LPs who subscribed to that particular quarterly fund.  This means that an LP does not participate in distributions from quarterly funds formed before its subscription was accepted or after the subscription is canceled or rejected. 

 

Carried interest is calculated based on an LPs minimum subscription period (the number of quarterly funds subscribed to in advance).  LPs will pay carried interest only after receiving a 100% return of their capital contributions to funds over their minimum subscription period. 

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