- **Setting the Successor Fund Threshold to 0%** generally means there is **no deployment-based gate** before the manager can start raising the next fund.
- In practice, the GP could begin fundraising for Fund II **immediately or at any time**, subject to the rest of the LPA and LP relationship dynamics.
Why choose **0%**:
- maximum flexibility
- useful if a manager wants to overlap fundraising with deploying Fund I
- can matter for small/first funds where getting to Fund II quickly is strategically important
What LPs usually expect for a **first fund**:
- **50% or 70%** is more LP-protective and more common than 0%
- many LPs also care more about **trust, communication, thesis discipline, and momentum** than just one threshold term
References:
-
https://decilehub.com/base/1-general_questions/163879-how-are-disagreements-between-lps-and-the-gp-resolved-when-their-interests-naturally-differ
- https://decilegroup.com/articles/what-lps-look-for-in-fund-managers
