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 "identifier": "kaal:entity:management-fees",
 "name": "Management fees",
 "termCode": "management-fees",
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 "author": {
  "@type": "Person",
  "name": "Wulf A. Kaal",
  "identifier": "https://orcid.org/0000-0003-0757-275X"
 },
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 "subjectOf": [
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/2959730-005",
   "identifier": "kaal:claim:2959730-005",
   "text": "The historical private fund management fee of 2% has shifted in recent years to roughly 1.0% for new managers and 1.5 to 1.8% for established managers with an adequate track record.",
   "abstract": "However, the historical fee of 2% of commitments through the reinvestment period, then 2% on the cost basis for the investments/value of fund has shifted in recent years closer to 1.0% for new managers and 1.5-1.8% for established managers with an adequate track record.",
   "citation": "Wulf A. Kaal, Blockchain Applications and Fee Structure Developments in Private Investment Funds (2017). SSRN: https://ssrn.com/abstract=2959730",
   "datePublished": "2017",
   "claim_type": "empirical",
   "confidence": "evidenced",
   "is_failure_mode": false,
   "scope_conditions": [
    "private equity and hedge fund managers",
    "established managers require an adequate track record"
   ],
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   "status": "current"
  },
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/2959730-006",
   "identifier": "kaal:claim:2959730-006",
   "text": "First time managers are disproportionately affected by the new fee environment: unlike in the recent past they are now often forced to share the business budget, such as rent and employee salaries, in order to justify a 1.5% management fee.",
   "abstract": "First-time or new managers are particularly affected by the new fee structure. Unlike in the recent past, first-time managers are now often forced to share the business budget (rent, employee salaries, etc.) to justify the 1.5% management fee.",
   "citation": "Wulf A. Kaal, Blockchain Applications and Fee Structure Developments in Private Investment Funds (2017). SSRN: https://ssrn.com/abstract=2959730",
   "datePublished": "2017",
   "claim_type": "empirical",
   "confidence": "asserted",
   "is_failure_mode": false,
   "scope_conditions": [
    "first time or new fund managers",
    "fund formation and seed investment negotiations"
   ],
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  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/2959730-012",
   "identifier": "kaal:claim:2959730-012",
   "text": "Private investment fund management fees deviate from the market rate of 1.5% to 2% of the fund's capital commitments because affiliates and other employees of the investment manager who invest in the fund are not charged management fees.",
   "abstract": "In recent years, private investment fund management fees can deviate from the market rate of 1.5%–2% of the fund's capital commitments because affiliates or other employees of the investment manager who invest in the fund are not charged management fees",
   "citation": "Wulf A. Kaal, Blockchain Applications and Fee Structure Developments in Private Investment Funds (2017). SSRN: https://ssrn.com/abstract=2959730",
   "datePublished": "2017",
   "claim_type": "mechanism",
   "confidence": "argued",
   "is_failure_mode": false,
   "scope_conditions": [
    "funds with affiliate or employee investors"
   ],
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   "status": "current"
  },
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/2959730-013",
   "identifier": "kaal:claim:2959730-013",
   "text": "The new fee structure also results from fund managers foregoing market rate management fees, larger investors requiring reduced management fees as a condition of investing, and side-by-side co-investment vehicles charging less than 2% management fees.",
   "abstract": "The new fee structure is also the result of fund managers foregoing market rate management fees, larger investors requiring reduced management fees to induce investment, side-by-side vehicles attracting investors in the co-investment entities by charging less than 2% management fees",
   "citation": "Wulf A. Kaal, Blockchain Applications and Fee Structure Developments in Private Investment Funds (2017). SSRN: https://ssrn.com/abstract=2959730",
   "datePublished": "2017",
   "claim_type": "mechanism",
   "confidence": "argued",
   "is_failure_mode": false,
   "scope_conditions": [
    "funds using side by side or co investment vehicles",
    "funds seeking large anchor investors"
   ],
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   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/2959730-033",
   "identifier": "kaal:claim:2959730-033",
   "text": "LendingRobot can charge only a 1% management fee and a maximum 0.59% annual fund expense fee because its blockchain secured business model removes the investment adviser, overhead costs, and the legal fees associated with each investor agreement.",
   "abstract": "Because LendingRobots' business model removes the investment adviser, overhead costs, and legal fees associated with each investor agreement, LendingRobot is able to charge a mere 1% management fee and a maximum 0.59% fund expense fee per year.",
   "citation": "Wulf A. Kaal, Blockchain Applications and Fee Structure Developments in Private Investment Funds (2017). SSRN: https://ssrn.com/abstract=2959730",
   "datePublished": "2017",
   "claim_type": "mechanism",
   "confidence": "evidenced",
   "is_failure_mode": false,
   "scope_conditions": [
    "fully automated hedge fund secured by blockchain technology",
    "weekly withdrawals at no additional cost to the investor"
   ],
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  },
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/2998033-027",
   "identifier": "kaal:claim:2998033-027",
   "text": "Private fund management fees have compressed materially: the historical two percent of commitments has shifted in recent years to roughly 1.0 percent for new managers and 1.5 to 1.8 percent for established managers with an adequate track record.",
   "abstract": "However, the historical fee of 2% of commitments through the reinvestment period, then 2% on the cost basis for the investments/value of fund has shifted in recent years closer to 1.0% for new managers and 1.5-1.8% for established managers with an adequate track record.",
   "citation": "Wulf A. Kaal, Blockchain Innovation for Private Investment Funds (2017). SSRN: https://ssrn.com/abstract=2998033",
   "datePublished": "2017",
   "claim_type": "empirical",
   "confidence": "evidenced",
   "is_failure_mode": false,
   "scope_conditions": [
    "describes private equity and hedge fund fee practice as of 2016 and 2017"
   ],
   "source_pdf_sha256": "aafb1be3c25cd33da477d759df9ca2f856f0a8fe133d6396da2e75d0af573dbd",
   "status": "current"
  }
 ],
 "description": "6 claims in the published works of Wulf A. Kaal carry the concept tag 'management-fees'. Derived node: a roster, not an adjudicated definition."
}