Angel Investors Network

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    Preferred Return

    Preferred Equity vs. Preferred Return: What's the Difference (and Why It Costs You Money If You Confuse Them)
    Real Estate

    Preferred Equity vs. Preferred Return: What's the Difference (and Why It Costs You Money If You Confuse Them)

    Preferred return is a distribution rule inside LP equity, while preferred equity is a senior capital layer paid ahead of common equity.

    Jeff Barnes, MBA··11 min read
    Hurdle Rate in Private Equity: Why the 8% Preferred Return Matters to LPs
    Alternative Investments

    Hurdle Rate in Private Equity: Why the 8% Preferred Return Matters to LPs

    The hurdle rate, also called the preferred return, is the annual return threshold that LPs must receive before a private equity GP can collect carried interest. The industry standard is 8%, per ILPA d

    Jeff Barnes, MBA··7 min read
    Preferred Return in Private Equity: Why the 8% Hurdle Protects LPs First
    Private Equity

    Preferred Return in Private Equity: Why the 8% Hurdle Protects LPs First

    Preferred Return in Private Equity: Why the 8% Hurdle Protects LPs First TL;DR: According to the Goodwin Private Investment Funds Terms Database , roughly 80% of private equity buyout funds set their hurdle rate at...

    Jeff Barnes, MBA··12 min read