The carried interest Catch-Up refers to the situation in which a fund manager is fully compensated at the agreed-upon rate, once investors have received their preferred return as disclosed in the Partnership Agreement. Under such a fee arrangement, the investor typically still receive profit in addition to their expected return, but only once the manager has received their pre-agreed share. If a fund has a 100% catch up provision, then once a fund generates returns above the pre-determined hurdle (typically 8%), a fund manager will typically receive 100% of all distributions until they “catch up” to a pre-determined percentage (typically 20% of all distributions made). Thereafter, returns are split between the fund manager and investors (typically split 80% to investors and 20% to the fund manager).