For most emerging managers, default to a **European waterfall**.

- **European / whole-fund**: LPs get all contributed capital back first, and sometimes a pref, before GP carry is paid
- **American / deal-by-deal**: GP can receive carry earlier on individual winners

How to choose:
- **Pick European** if you are a Fund I or early emerging manager: it is generally more **LP-friendly**, simpler to defend, and more common in emerging-manager venture
- **Pick American** only if you have unusual leverage with LPs and are prepared for stronger **clawback** protections if later deals underperform
- Avoid adding complexity unless LP demand clearly justifies it

Decile context:
- **Start Fund uses a European waterfall**: https://decilehub.com/base/1-general_questions/90454-does-start-fund-use-american-or-european-waterfall

References:
- https://decilehub.com/base/1-general_questions/163729-why-does-the-lpa-have-different-options-for-how-carried-interest-is-distributed
- https://decilehub.com/base/166-general/163582-summary-of-lpa-queries-spvs-lp-lock-up-and-american-vs-european-carry