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Liquidation preferences

If your fund has investments where there are active Liquidation Preferences (”liq prefs”), you can run Exit scenarios to incorporate the impact of liq prefs.

Adding an liquidation preference waterfall to an investment

  1. 1.
    Click on Liq Prefs from the Actions toolbar within an investment's Performance Case
  2. 2.
    Turn on Enable Liquidation Preferences
  3. 3.
    Specify the following:
    • Total Liq Pref Owned: This is the total amount of liquidation preference owned by your fund. For e.g. if you have a 2x Liq Pref on a $2mm investment, you would enter $4mm in this field
    • Liq Pref Type: Specify whether your liq pref is participating or non-participating
    • Liq Pref Cap (for participating liq prefs only): Specify if there is a liq pref cap
    • Liq Pref Cap Amount: If there is a cap, enter the cap amount. For e.g. if you have a 3x cap on a $2mm investment, you would enter $6mm as the cap.
    • Total Liq Prefs in Front: The total amount of liq prefs expected senior to our position.
    • Total Other Liq Prefs Pari Passu: Amount of liq prefs pari passu to us (not including our own)
    • Total Liq Prefs Senior: Total amount of liq prefs that are below or junior to us in the exit waterfall.
  4. 4.
    Once a liquidation pref waterfall has been created, the Exit Event will show a “Liq Prefs Active” sign to signify that there are active Liquidation Prefs in effect.

Working with multiple cases

If you are working with multiple performance cases, you may want to copy liq prefs from one case to another. From the Actions toolbar, click on Liq Prefs to import a liquidation preference waterfall from another case.