Your numbers
Legal, admin, travel, tools, audit, fund formation amortized.
At $15M, your annual management fee budget is $300K — $210K short of your team's $510K annual budget.
| Line item | Annual |
|---|---|
| Partner comp (total) | $360,000 |
| Operating costs | $150,000 |
| Total budget needed | $510,000 |
| Management fee at your target size | $300,000 |
| Effective comp per partner at target size | $75,000 |
What is the minimum viable fund size for a first-time VC fund?
For a solo GP or two-partner team drawing $150K–$200K annual salary each with a modest operating budget, the minimum viable fund size at a 2% management fee is typically $10M–$20M. Below this, management fees alone are not enough to sustain a full-time team, and GPs often need outside income, a smaller team, or a lower personal comp target to make the fund work.
How much should GP salaries be relative to fund size?
GP salaries are typically paid from the management fee budget, not fund returns — carry only pays out years later, if the fund performs. A common benchmark: total annual operating costs (salaries + opex) should not exceed the annual management fee (fund size × fee rate). Many emerging managers size their raise around deal-making ambitions without separately checking whether the fee budget can sustain their team.
Why do emerging managers underestimate the fund size they need?
First-time GPs often size their target raise around check size × number of portfolio companies, without modeling whether the resulting management fee covers salaries and opex for the full investment period. A fund can look attractive to LPs on paper — right thesis, right stage focus — and still be financially unsustainable for the team running it. Running this calculation before you start fundraising avoids raising a fund you can't actually operate.
Once your fund size target is set, build your LP list
Altura Data's investor database gives emerging GPs verified, structured LP and family office contacts — filterable by AUM, geography, and stage focus — ready to import into your CRM.
Frequently asked questions
What is the minimum viable fund size for a first-time VC fund?
For a solo GP or two-partner team drawing $150K–$200K annual salary each with a modest operating budget, the minimum viable fund size at a 2% management fee is typically $10M–$20M. Below this, management fees alone are not enough to sustain a full-time team.
How much should GP salaries be relative to fund size?
GP salaries are typically paid from the management fee budget, not fund returns. Total annual operating costs (salaries + opex) should not exceed the annual management fee (fund size × fee rate). Many emerging managers underestimate this and raise a fund too small to sustain their target team.
What is a typical management fee percentage?
Most VC and PE funds charge a 2% annual management fee on committed capital during the investment period, sometimes stepping down to 1–1.5% afterward. Smaller or newer funds sometimes negotiate slightly lower fees to be more LP-friendly, which further raises the minimum viable fund size needed to sustain the team.
Why do emerging managers underestimate the fund size they need?
First-time GPs often size their target raise around deal-making ambitions without separately modeling whether the resulting management fee covers their team's salaries and operating costs for the full investment period. Running this calculation before fundraising avoids raising a fund you can't actually operate.