WHITE PAPER

A Jumble of Waterfalls

MAKING SENSE OF DISTRIBUTION CALCULATION MODELS

The term "waterfall" in private markets can mean different things to different people, often leading to confusion, misunderstandings and ultimately, wasted time. In this white paper we determine four main areas where waterfalls exist:

• Allocation between products
• Allocation of proceeds among limited partners
• Allocation between GP and LP
• Allocation within the GP

We’ll explore the reasons why waterfalls are required in each of these contexts and highlight the key points to identify when someone refers to them in these areas.