how are private equity funds managed 
a private equity fund is managed by a general partner gp typically the private equity firm that established the fund the gp makes all of the fund s management decisions it also contributes 1 to 3 of the fund s capital to ensure it has skin in the game in return the gp earns a management fee often set at 2 of fund assets and may be entitled to 20 of fund profits above a preset minimum as incentive compensation known in private equity jargon as carried interest limited partners are clients of the private equity firm that invest in its fund they have limited liability 28