The 2-and-20 compensation structure for venture capital funds is a one-size-fits-all approach that misaligns incentives and can help VCs to get paid handsomely while their funds perform abysmally.
That was one conclusion from a much-discussed report on the venture capital industry from the Kauffman Foundation last month.
“It’s interesting that VCs have positioned themselves as supporters, financers, and even instigators of innovation, yet there has been so little innovation within the VC industry itself,” the report states.
To read the full, original article click on this link: Is it time for the venture capital industry to ditch the 2-and-20 pay model?
