In venture capital funds and Special Purpose Vehicles (SPVs), carry recipients are the entities or individuals that receive carried interest (“carry”) from the fund’s profits. These recipients typically include General Partners (GPs) or other individuals/entities involved in the fund’s management or performance. Setting up a carry recipient ensures that the individuals or entities entitled to carry are properly registered and tracked.
What is a carry recipient?
A carry recipient is a person or entity designated to receive the carried interest from a fund or SPV. The carry recipient setup is critical to ensure that the distribution of profits is done accurately and transparently, reflecting the terms outlined in the fund’s agreement.
Why set up a carry recipient?
- Accurate profit distribution: Ensures that carry is properly allocated to the appropriate parties based on the fund’s performance.
- Compliance: Helps maintain clear records for tax purposes and investor reporting.
- Tracking: Facilitates the calculation and payment of carried interest over time.
Next steps: How to set up a carry recipient
Now that you understand what a carry recipient is, let’s walk through the process of adding a carry recipient to your fund or SPV. Below are the steps to add a carry recipient on AngelList:
- Log in to your AngelList account:
Start by logging into your AngelList account to access your fund or SPV dashboard.
- Navigate to the fee recipient section:
From your dashboard, locate and click on the “Fee Recipients” tab of the “Venture Firm Settings” section.
- Add a new fee recipient:
Look for the option to “Add Fee Recipient.” You’ll be prompted to enter details about the recipient.
- Enter the carry recipient’s information:
Fill in the necessary information, including the recipient’s name, legal entity, tax information, and KYC information (required by our banking partners).
- Review & submit:
Double-check the information to ensure accuracy.
After submitting the recipient information, a member of our team will review and verify the information.
Where can I find carry paid to the fee recipient?
Once the entity has been verified, you can click the entity's name on the Fee Recipients page to see the account balance and withdraw funds through any of the connected bank account options.
