Fund of Funds - Private Equity

In this video, Steve discusses fund of funds in private equity:
0:00 - Introduction
0:15 - Direct Investing -
0:23 - Investing in private equity funds -
0:48 - Fund of funds investing -
1:11 - Quiz -
1:39 - Compensation in a private equity fund of funds -

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Disclaimer: All investment and financial information expressed in this video is for educational purposes only.

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[raymartinez]

Hello Steve! Thank you for this video and this strategy is very interesting, I do have a question that came up and it's very intriguing to me. How does the fund of the fund calculate the asset management fees into their numbers? let's say I own a fund of funds, and an operator/sponsor has a deal with a 16% IRR, 8% CoC and 1.8X equity multiple. Now, let's say our firm charges our investors a 1% management fee and 5% carried... How do we calculate the actual, final numbers to our investors? 16%IRR - (minus) the 1% would be a 15% IRR? Or that's the wrong way to calculate...and what about the equity multiplier and Cash on Cash returns? How do you calculate the final numbers based/after your asset management fees?

[Craftesha]

Nice and appriciated the way of teaching. Small topics and terminologies. Do you have sometimes to learn from operational front? To account, front and back office in private equity?

[Jaffer_shaikh]

Hello Steve, What do you suggest in terms of a OPC gets establish as a PE fund of fund firm.?

[WallStreetIceCream]

Is a CAIA valuable ? What can you do with it ?