The Road to Partner

What changes at partner

Partners still write checks. They also raise the fund, answer to LPs for its performance (chapter 7), hire, and set the firm's direction.

How track records get judged

The central problem: a principal's deals take years to prove themselves. Firms and LPs use proxies in the meantime.

• Attribution. Which deals were yours: sourced, led, board seat. Keep your own record, with dates, because memories are generous to whoever is telling the story.
• Markups, discounted. Later rounds at higher prices are evidence, but everyone knows marks aren't cash (module 7.3). A record with some realised exits carries far more weight.
• Judgment on the passes. What you declined, and why, once those companies' outcomes are known.
• Founder references. What the CEOs you work with say about you, especially about the hard moments.

Carry inside the GP

Carried interest (module 1.2) is paid to the GP entity, which then allocates it among the team. The usual mechanics:

• Carry points. Each person gets a share of the fund's carry pool, usually expressed as a percentage of the carry.
• Vesting. Allocations typically vest over several years, so leaving early means forfeiting some or all of the unvested part.
• Per fund. Your allocation in Fund III says nothing about Fund IV. Ask about both.
• Clawback exposure. If the GP has to return carry (module 7.1), the individuals who received it may have to contribute.
• GP commitment. Partners are often expected to fund part of the GP's own commitment to the fund, in cash.

Actual allocations vary widely and are rarely published. The site's compensation surveys are the best public benchmarks for salary and bonus; carry terms you'll mostly learn by asking. When you're offered carry, ask which fund, what share of the pool, the vesting schedule, what happens if you leave, and whether you'll be expected to commit capital.

LPs are part of the decision

LPs back people as much as firms. When a firm raises its next fund, LPs diligence the partners, including who is likely to be carrying the firm in five years. A principal close to partner may be introduced at the annual meeting, asked to present their companies, and reference-checked. Knowing what LPs look for (a clear strategy, consistency, alignment, honest reporting) is part of preparing for the role.

The other path: your own fund

Some principals conclude the fastest route to partner is to become one somewhere new: at another firm, or at their own fund. Raising a first fund is its own discipline: an investable strategy and track record, a small group of anchor LPs, and fund operations that meet institutional expectations (chapter 7). It takes longer than people expect; managers raising a first institutional fund commonly plan for well over a year.

What this means for you

Start building the evidence two years before you expect the conversation: your deal record with attribution, founder references you'd be happy for anyone to call, a published thesis (module 6.4), and a few LP relationships of your own. And ask your firm, directly, what it would take. The criteria are often less defined than you'd expect, and asking early is how you find out.