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0 pointsHavoc1y ago0 comments

Once again he was GP of the startup fund, not an LP. (At least not to my knowledge)

Unless there was some sort of carry or other compensation I’d say it’s pretty fair to describe that as not owned.

A bit like a trustee wouldn’t claim to own the trust fund. The beneficiaries do

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A GP is a partner and as such has an financial interest in the success of the fund. In fact, they have a greater financial exposure than LPs, since they have unlimited liability for the partnership’s obligations (how much upside they have depends on the partnership agreement, its possible that LPs have all of that and a GP that's not also an LP would not — but just having downside exposure is still a serious financial interest.)

IG_Semmelweiss1y ago

you are right, but the GP does have usually some kind of interest. Usually 1%. Yes, its tiny, but its there.

HavocOP1y ago

>GP is a partner and as such has an financial interest in the success of the fund

Sure there will be some stake attached to GP, that may be a national dollar or it may be more depending on structuring. We don't know either way. My point is based on knowing nothing more than he is a GP we can't conclude "he owned the OpenAI startup fund" which is verbatim what is being claimed in the article and what I objected to.

>how much upside they have depends on the partnership agreemen

...right which is what I meant with "some sort of carry or other compensation".

morgante1y ago

1. Why do you assume he wouldn't receive carry? Carry is standard so the presumption should be that he receives carry unless otherwise clarified.

2. GP commitments are also common. LPs want GPs to have "skin in the game" and I think it's absolutely reasonable to claim the GP "owns" the fund (just not as a sole owner).

FireBeyond1y ago

> I’d say it’s pretty fair to describe that as not owned.

I'd agree with that. But you also ignored the very next statement.

> even though he constantly was claiming to be an independent board member with no financial interest in the company

Are you going to claim that a GP of a fund has no financial interest in the fund, too?

HavocOP1y ago

>Are you going to claim that a GP of a fund has no financial interest in the fund, too?

We don't know either way. I've seen GP shares in the 100s of millions and I've seen GP shares that are notional $100. Just depends on the structuring. So from knowing he's GP the article can't reasonably conclude "he owned the OpenAI startup fund".

Nevermark1y ago

So why did he carefully not say that. To the board, FFS.

A trustee who wasn't playing games would simply say they were the trustee.

j / k navigate · click thread line to collapse

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dragonwriter1y ago

IG_Semmelweiss1y ago

you are right, but the GP does have usually some kind of interest. Usually 1%. Yes, its tiny, but its there.

HavocOP1y ago

>GP is a partner and as such has an financial interest in the success of the fund

>how much upside they have depends on the partnership agreemen

...right which is what I meant with "some sort of carry or other compensation".

morgante1y ago

1. Why do you assume he wouldn't receive carry? Carry is standard so the presumption should be that he receives carry unless otherwise clarified.

2. GP commitments are also common. LPs want GPs to have "skin in the game" and I think it's absolutely reasonable to claim the GP "owns" the fund (just not as a sole owner).

FireBeyond1y ago

> I’d say it’s pretty fair to describe that as not owned.

I'd agree with that. But you also ignored the very next statement.

> even though he constantly was claiming to be an independent board member with no financial interest in the company

Are you going to claim that a GP of a fund has no financial interest in the fund, too?

HavocOP1y ago

>Are you going to claim that a GP of a fund has no financial interest in the fund, too?

Nevermark1y ago

So why did he carefully not say that. To the board, FFS.

A trustee who wasn't playing games would simply say they were the trustee.

j / k navigate · click thread line to collapse