Legal Framework and Governance in Venture Capital and Start-ups Assessment
Module 8 • 10 Questions
Question 1 of 10
0 of 10 answered
A SEBI-registered Category I Venture Capital AIF has a committed capital corpus of $80,000,000.00. The fund cannot invest more than 25% of its total corpus in a single startup. The fund charges LPs an annual 2.0% management fee on committed capital during its 5-year active investment period. Upon exit, the fund collects a total return of $240,000,000.00, and has a carried interest rate of 20% on all net profits (profits defined as total exits minus committed capital and cumulative management fees). What is the maximum single investment the fund can make, and what is the exact carried interest payable to the General Partners (GPs) upon winding up?
A
Max Single Investment: $20,000,000.00; Carried Interest: $30,400,000.00
B
Max Single Investment: $20,000,000.00; Carried Interest: $32,000,000.00
C
Max Single Investment: $15,000,000.00; Carried Interest: $30,400,000.00
D
Max Single Investment: $20,000,000.00; Carried Interest: $24,000,000.00