Carried Interest (Carry)

Carried interest is the GP's share of a fund's profits, most commonly 20%, earned after LPs get their contributed capital back. If a fund turns $50M of called capital into $150M, roughly $20M of the $100M profit goes to the GP as carry and the rest to LPs. Unlike buyout funds, most VC funds have no hurdle rate, and carry is the primary way successful venture investors build wealth.