SmartHelping / Joint Venture / Excel
Joint Venture Preferred Return and Promote Model
Model LP preferred return, return of capital, GP promote, two GP entities and time-based vesting across 10 years of cash flow.
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Editable Excel file • Immediate download • Terms
Model Preview
See how the waterfall works
Review the capital structure, cumulative LP preferred return, return of capital, residual split, GP allocations and vesting logic.
Inside the Model
Build a complete LP and GP distribution schedule
Enter capital contributions and distributable cash flow, then allocate proceeds through the preferred-return and promote structure.
Enter 10 years of cash flow
Input annual distributable cash flow and review the resulting allocations across the full forecast period.
Define LP and GP ownership
Configure equity contributions, ownership percentages and the amount of capital invested by each party.
Include additional contributions
Add future equity contributions and incorporate them into investor capital accounts and return calculations.
Accrue unpaid preferred return
Calculate cumulative LP preferred return, including amounts that remain unpaid when current-period cash is insufficient.
Return LP capital
Allocate 100% of the applicable cash flow to the LP until the defined LP capital balance has been returned.
Apply the residual promote split
Divide remaining proceeds between the LP and GP according to the selected residual ownership and promote percentages.
Allocate promote between GP entities
Divide GP promote distributions between two separate GP entities using editable allocation assumptions.
Model promote vesting
Apply an annual vesting schedule to Entity 2 and control how unvested promote is reallocated.
Distribution Waterfall
Follow available cash through each distribution tier
The model carries unpaid obligations forward and applies each tier in sequence before allocating residual proceeds.
1. Available cash
Begin with the annual distributable cash flow available to the joint venture investors.
2. LP preferred return
Pay the cumulative LP preferred return, including any unpaid amount carried forward from prior periods.
3. Return LP capital
Allocate cash to the LP until the applicable contributed capital has been returned.
4. Residual split
Divide remaining proceeds between the LP and GP using the selected promote structure.
GP Promote and Vesting
Separate promote economics from invested capital
Allocate GP promote between two entities and apply a customizable vesting schedule to the second entity’s promote participation.
Two GP entities
Split the GP promote between Entity 1 and Entity 2 independently from their underlying invested capital.
Annual vesting schedule
Define the percentage of Entity 2’s promote that becomes vested during each year of the projection.
Unvested promote treatment
Choose whether Entity 2’s unvested promote is reallocated to Entity 1 or returned to the LP.
Flexible incentive structures
Model operating-partner incentives, seller rollovers and other time-based promote arrangements.
Model Workflow
Move from capital assumptions to investor returns
Configure the joint venture terms before reviewing annual distributions, capital balances and investor outcomes.
Define the capital stack
Enter LP and GP contributions, ownership percentages and starting capital balances.
Enter cash flow
Add annual distributable cash flow and any future equity contributions across the 10-year period.
Configure the waterfall
Set the preferred return, capital-return tier, residual split, GP allocations and vesting.
Review investor results
Analyze distributions, outstanding balances, investor cash flows, IRRs and equity multiples.
Model Outputs
Review the deal from every investor perspective
Summary dashboard
Review capital contributions, distributions, return metrics and the major waterfall terms in one place.
Complete waterfall schedule
Audit preferred-return accruals, capital balances and distributions through every waterfall tier.
Investor-level returns
Calculate cash flows, IRRs and equity multiples for the LP, GP and individual GP entities.
Charts and model checks
Use distribution charts, implementation notes and automated checks to review and customize the structure.
Who It’s For
Use the waterfall across multiple investment structures
Real estate joint ventures
Allocate property cash flow between institutional capital and the sponsor or operating partner.
Business acquisitions
Model buyer, investor, seller-rollover and management-incentive economics.
Private investments
Structure preferred returns and promote participation around long-term distributable cash flow.
Sponsors and advisors
Explain, test and document the expected economics for each participating investor.
Bundle Options
Get this model within a larger collection
Related Templates
Compare alternative waterfall structures
Splits in Each Tier
Configure separate LP and GP distribution splits across multiple preferred-return tiers.
View template →IRR Hurdles with GP Catch-Up
Model multiple IRR hurdles followed by a GP catch-up and promote structure.
View template →Cumulative Distribution Hurdles
Allocate cash according to cumulative distribution thresholds and changing splits.
View template →Simple Preferred Return
Use a streamlined preferred-return model with configurable hurdle assumptions.
View template →Frequently Asked Questions
Joint venture model FAQ
What is the model’s default waterfall structure?
The default structure uses an 8% cumulative LP preferred return, followed by a 100% return of LP capital and a 70% LP / 30% GP residual split without a GP catch-up.
What happens when there is not enough cash to pay the LP pref?
The unpaid preferred return accrues and carries forward into future periods until sufficient cash becomes available.
Can I enter additional capital contributions?
Yes. The model accepts additional equity contributions across the 10-year forecast and incorporates them into the relevant capital balances and investor cash flows.
How many GP entities can receive promote distributions?
Promote distributions can be allocated between two separate GP entities using editable allocation percentages.
How does Entity 2 vesting work?
Entity 2 can use a customizable annual promote-vesting schedule. Any unvested portion can be reallocated to Entity 1 or to the LP.
What return outputs are included?
The workbook includes investor-level cash flows, distributions, IRRs, equity multiples, charts, a summary dashboard and automated checks.
Turn joint venture terms into a complete waterfall
Model LP preferred return, return of capital, GP promote, entity-level vesting and investor returns in one editable Excel template.
Get the Joint Venture Model