The Clock Is Ticking on Your Profit Interest

A plain-language guide for executives at PE-backed companies who hold profit interest or carried interest and need to understand how to prepare for a liquidity event.

What this guide covers

• How profit interest and carried interest actually work: the mechanics most executives never fully understand
• The hurdle rate, waterfall, and what determines how much you actually receive at exit
• Key tax treatment differences and where planning decisions can materially change your outcome
• What to ask your employer and your financial team before a deal closes
• Why timing and advisor selection are the two levers executives most often get wrong