[barber5]

It's worth saying that at a number of firms that 2% goes into the pockets of the partners.

One thing to like about a16z (full disclosure, I worked there over the summer), imho, is that by using this fee to scale their organization to help portfolio companies, they are far less out of alignment with LPs than most firms who have success with a smaller fund and go on to raise a larger one.

The old algorithm of do ok with a small fund, raise a huge one and live off the management fee is under threat -- 5x or die.