What is Clawback Provision?
Clawback Provision
A Clawback Provision is a legal clause in a venture capital fund agreement requiring the fund managers (GPs) to return excess carried interest if subsequent investments underperform.
Detailed Deep Dive
A Clawback Provision is a legal clause in a venture capital fund agreement requiring the fund managers (GPs) to return excess carried interest if subsequent investments underperform.
Frequently Asked Questions
Q:Why is clawback necessary?
If early exits generate massive profits and GPs collect carry, but later investments lose money, the GP may end up with more than their 20% carry share of total fund profits.
Q:When is a clawback executed?
Typically at the final liquidation of the fund (around Year 10 or 12).
Quick Facts
- CategoryFunding
- Key ApplicationLP protection against GP overpayment
Coverage Trend12 Weeks
Related Terms
Clawback Provision Media Coverage & Intelligence
No Direct Clawback Provision News Today
We currently have no direct coverage articles matching "Clawback Provision" in the database archive. Explore trending global tech stories below instead.
Trending Tech Stories
The Control Gap: Enterprise AI organizations have an ownership problem, not a technology problem - and most are governing it by hand
AI portfolios are expanding far faster than the ability to govern them across enterprises. Most organizations run a contested field of platforms, each claiming
SpaceX has an AI device prototype, and it sure sounds phone-ish
SpaceX reportedly showed investors a "handset-like" AI device before going public. It could be another signal SpaceX wants to expand into wireless.
Ashton Kutcher leaving Sound Ventures to launch new VC firm with Morgan Beller
The actor and investor is joining forces with Morgan Beller, who was previously a GP at NFX, to invest in early-stage startups.
You Can Now Sound the Alarm on AI Behaving Badly
Are you worried your AI chatbot is trying to build a bomb or leak personal information about you? There's a website for that.