Altman: Traditional VC firm hierarchies distort associate incentives away from fund returns
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Max Altman, co-founder of Saga Ventures, explains why traditional venture capital fund structures align associate incentives around short-term markups rather than LP returns.
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“I don't know if they're fucked up cultures, but I don't think they're incentivized to have the best returns. If you're an associate at a firm, and you're maybe there for five or six years, your job is to get a deal done that's gonna get marked up quickly so you look good and then can Get promoted or get poached to go to another fund, but you have so little carry, and you're probably not going to be there the 12 years until you see any liquidity. You're not incentivized the right way.”
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