Gauri Deoras
• 6. Industry Benchmarks and Best Practices • How does the recycling rate in this model compare to comparable funds in similar sectors or stages? • What lessons can be drawn from successful funds that used similar recycling strategies? • What are industry best practices for the proportion of recycled capital relative to total distributions? • How does the model's assumed capital recycling rate compare to those of high-performing funds • 7. Impact-Based Outcomes and Reporting (e.g., Article 9 Funds) • How can the model be adapted to integrate non-financial KPIs that measure impact outcomes in line with Article 9 requirements? • What specific sustainability metrics (e.g., carbon reduction, social equity improvements) are incorporated, and how are they quantified? • How does the model account for both financial and non-financial returns when calculating fund performance? • Are the chosen impact metrics aligned with the EU Taxonomy and SFDR reporting standards? • What frameworks (e.g., GRI, SASB, IRIS+) are used for measuring and reporting impact, and how does the model accommodate them? • How is impact data collected, verified, and reported throughout the fund lifecycle? • What weighting is applied to impact metrics versus financial performance when assessing the success of the fund? • Does the model include scenario analysis for potential trade-offs between financial returns and impact goals? • How does the model simulate the risk of impact underperformance and its implications for investors? • What governance mechanisms are in place to ensure that impact goals are maintained throughout the investment period?
Gauri Deoras
3. Recycled and Retained Capital Strategy • What criteria are used to determine the amount of capital to recycle versus distribute to LPs? • Are there predefined thresholds or trigger events that guide the recycling of capital? • How does the fund balance between maximizing distributions and maintaining recycled capital for follow-on investments? • What are the typical scenarios where recycling capital is preferred over distribution? • How does recycling impact the GP's carried interest calculation, and is this communicated transparently to LPs? • Is recycled capital allocated primarily to existing portfolio companies or reserved for new opportunities?
Gauri Deoras
2. Return Projections and Performance Assumptions • What are the best practices/benchmarks to reflect power law assumptions for fund return multiples? • How does the model account for the distribution of portfolio companies by their expected performance (e.g., 60% written off)? • What IRR and multiple benchmarks are used to assess model performance, and how do these compare to historical VC fund performance? • What distribution assumptions are used for exit outcomes (e.g., IPO, acquisition, write-off)? • How sensitive is the model to changes in exit timing or valuation at exit? • Are power law distributions explicitly modeled, or inferred from historical data? • How does the model handle the J-curve effect, especially in the early years of the fund?
Sushma Vadlamannati
How is the money collected from a capital call treated before it is invested into startups? Does it accrue interest in a bank? What restrictions are imposed on that money - eg. can it be invested in crypto while the fund identifies the right startup to invest in?
Sushma Vadlamannati
I added an individual LP to the “closing” stage but didn’t see them in the capital accounts section. Only when I added an organization as an LP I could copy them to the closing funnel. Are there any differences in how an individual vs an organization are handled in Decile Hub? Why?
Sushma Vadlamannati
Could you please share the components of the expense report: • What all is included in the expenses portion of the income statement? Is management fees and carry considered an expense, or a distribution?
