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If they are making money? Venture funds are generally structured using the 2 and 20 model. The first 2 refers to an annual fee of 2% of committed capital for the life of the fund. Venture funds typically have a life of 10 years.

I believe Bessemer's last fund was $1.6 billion, so assuming a typical 2 and 20 structure, that would be $32 million/year, or $320 million over a 10 year fund's life, guaranteed.




Yup, that's one way to make money.

But as in

http://www.avc.com/a_vc/2013/02/venture-capital-returns.html...

on average the VC returns to the limited partners have not been very good.




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