J-Curve

The J-curve is the characteristic shape of a fund's returns over time: negative in the early years as fees are drawn and losers die first, then rising as winners get marked up and eventually exit. Venture J-curves are deeper and longer than buyout because startups fail fast and compound slowly. GPs should set LP expectations for it explicitly — a Fund I showing 0.8x TVPI in year two is on script, not off it.