Clarkson: Multi-billion-dollar VC funds disconnect GP fees from actual returns
Beezer Clarkson · Beezer Clarkson: Are LPs Open for Business & Why Do LP Incentive Mechanisms Need to Change? | E1073 · 20VC with Harry Stebbings · Oct 18, 2023 · at 38:37
Beezer Clarkson of Sapphire Partners explains how guaranteed management fees on multi-billion-dollar venture funds insulate GPs from fund performance.
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“If you have a fund that's, I don't know, many billions, you're going to have a number of GPs that are making significant dollars, assuming it's spent Not spent on platform and other things. But if you can make that kind of money without even returning the fund, that's very different from an LP who needs the money back to fund whatever it is they're trying to fund with it.”
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