For high-net-worth individuals and institutions looking to invest in venture capital, evaluating a fund can be complex. Beyond the pitch deck, how do you assess a fund's fee structure, exit strategy, and the General Partner's true commitment?



Justin Lim, Managing Partner at Nexea Ventures, joins us to break down the critical elements of fund assessment for Limited Partners (LPs). He explains the mechanics of the "2 and 20" fee structure, the difference between American and European waterfall models, and how to contextually assess a GP's "skin in the game."



We discuss:


The impact of investment stage (early vs. late) on risk and returns.


Why fund size can create "adverse selection" problems for exits in Malaysia.


The "2 and 20" fee model: management fees vs. carried interest.


Understanding the "hurdle rate" in the European waterfall model.


How to determine if a GP's "skin in the game" is truly meaningful.



For potential LPs and investors, this is essential insight to the financial mechanics and due diligence required for VC fund investing.

For high-net-worth individuals and institutions looking to invest in venture capital, evaluating a fund can be complex. Beyond the pitch deck, how do you assess a fund's fee structure, exit strategy, and the General Partner's true commitment?Justin Lim, Managing Partner at Nexea Ventures, joins us to break down the critical elements of fund assessment for Limited Partners (LPs). He explains the mechanics of the "2 and 20" fee structure, the difference between American and European waterfall models, and how to contextually assess a GP's "skin in the game."We discuss:<ul><li>The impact of investment stage (early vs. late) on risk and returns.</li><li>Why fund size can create "adverse selection" problems for exits in Malaysia.</li><li>The "2 and 20" fee model: management fees vs. carried interest.</li><li>Understanding the "hurdle rate" in the European waterfall model.</li><li>How to determine if a GP's "skin in the game" is truly meaningful.For potential LPs and investors, this is essential insight to the financial mechanics and due diligence required for VC fund investing.</li></ul>

From securing funding to optimising financial performance and cash flows, here on P&L we help decode the language of money and empower entrepreneurs, startup founders, and the c-suite with practical insights, expert advice, and powerful tools to help businesses navigate the  complexities of business finances.

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