Ep 111: The Terminology You Need to Know
The Nick Huber Show
00:00
How to Raise Money for a Deal
There's two different share types in a deal: common shares and preferred shares. The GP, me, the general partner, I get what's called common shares. And those are not really triggered and the money doesn't flow out to them until you hit certain waterfalls. So if an LP puts in $100,000 on an eight preff, the first $8,000 in profit that year will go to the investor. Once you hit that waterfall, that hurdle, that eight percent hurdle, what happens afterward? Now, now you're into something called the promote.
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