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Deal-by-Deal (American) Waterfall

While Middle Eastern LPs prefer European (whole-fund) structures, US sponsors often pitch American (deal-by-deal) waterfalls. This tool highlights how early winners generate GP carry, creating clawback risk if subsequent deals fail.

Deal 1 Economics

Deal 1 Capital Invested ($M)

Deal 1 Distributions ($M)

Deal 1 Hurdle Requirement ($M)

Carry (%)

Deal 1 Realization ($M)

1. Return of Capital

2. Preferred Return (LP)

3. GP Catch-up

Total LP Return

Total GP Carry

Clawback Risk: In an American waterfall, the GP realizes carry on Deal 1 independently of the rest of the fund. If Deal 2 is a total loss, the GP may have to return (clawback) the carry paid out on Deal 1 at the end of the fund's life to ensure the LP receives their aggregate preferred return. Abu Dhabi LPs heavily discount American waterfalls for this reason.

JavaScript Required: Deal-by-deal models calculate profits on individual realizations, often generating GP carry early in the fund life before the aggregate fund has returned total paid-in capital.