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What allocation and conflict questions should an LP ask a first-time venture manager?
a first-time venture manager: Ask how the manager allocates opportunities, expenses, and attention among funds, SPVs, personal holdings, and related relationships.
Ask how the manager allocates opportunities, expenses, and attention among funds, SPVs, personal holdings, and related relationships. A broad conflicts policy needs a practical process. Clarify what is disclosed, who decides, and how records are kept.
Start with the decision
Use a fictional competing-allocation scenario to test the policy. Request relevant disclosures and examples where permitted. Have qualified counsel explain legal duties or approval requirements rather than inferring them from informal practice.
The illustrative scenario
This is an educational workbook. The company or fund and all numerical inputs below are fictional. They are not ADIN results, customer claims, market benchmarks, or a forecast.
The fictional manager is raising a first independent fund after working on investments at another firm. The pitch includes several prior deals, but the LP has not yet verified the manager's role or permission to use those examples.
A prior employer's portfolio is not automatically an attributable personal track record. Separate sourcing, analysis, investment authority, board work, and realized outcomes for each deal.
Turn the scenario into an evidence decision
Consider a review of a first-time venture manager in which a confident explanation arrives before the supporting records. Start with the first question in the table. Write down what an answer would change: the next interview, the experiment's scope, a request for specialist review, or a decision to wait. A question without a consequence can produce a longer document while adding little understanding.
Next, inspect the record named in the table and record its date, owner, permission boundary, and limitations. Request a role-by-deal table, permissioned references, dated evidence of decisions, and clear realized versus unrealized figures. Keep unavailable evidence visible instead of filling gaps with estimates. If the record contradicts the explanation, preserve both accounts and ask which definition, period, or workflow differs. Do not silently select the version that makes the opportunity look strongest.
Finish with a conditional statement: if the specified evidence supports the claim under these conditions, take the named next step; otherwise investigate the unresolved question. The objective is to understand incentives and process, not to assume every related vehicle creates an unacceptable conflict. A transparent, specific explanation is more useful than a generic statement that interests are aligned. This worked exercise is about the decision process. It does not assert that a fictional company has met a real diligence standard or that a template can authorize an investment.
| Item | Illustration |
|---|---|
| Decision question | Which vehicles compete? |
| Case-specific constraint | A prior employer's portfolio is not automatically an attributable personal track record. Separate sourcing, analysis, investment authority, board work, and realized outcomes for each deal. |
| Record to inspect | Request a role-by-deal table, permissioned references, dated evidence of decisions, and clear realized versus unrealized figures. Keep unavailable evidence visible instead of filling gaps with estimates. |
| Comparison to preserve | Compare the proposed independent fund's work with the manager's actual prior responsibilities. Explain where the new role requires capabilities not shown by the old one. |
| Unresolved case question | Which decisions were actually theirs? |
Use this worksheet
Answer the questions with a source, date, owner, and next action. Mark an unknown as unknown. Use public or permissioned information and involve a qualified specialist when a question requires expertise beyond the team’s competence.
- Which vehicles compete?
- Who makes the allocation?
- What policy applies?
- What is disclosed to LPs?
- What record supports the decision?
Questions specific to this scenario
- Which decisions were actually theirs?
- Who can verify the attribution?
- What is missing from the independent operating plan?
Request a role-by-deal table, permissioned references, dated evidence of decisions, and clear realized versus unrealized figures. Keep unavailable evidence visible instead of filling gaps with estimates.
A concrete next test
Choose one successful prior investment and one unsuccessful example from the relevant set. Ask the manager to specify their role and obtain permissioned corroboration. Compare the work shown with the responsibilities they would hold in an independent fund, including decisions not previously theirs.
Interpret the result
The objective is to understand incentives and process, not to assume every related vehicle creates an unacceptable conflict. A transparent, specific explanation is more useful than a generic statement that interests are aligned.
Compare the proposed independent fund's work with the manager's actual prior responsibilities. Explain where the new role requires capabilities not shown by the old one.
Sources and method
These primary resources provide background for the concepts. The fictional scenario, calculations, and worksheet are ADIN educational examples; the sources do not report or validate those invented results. Reviewed October 11, 2026.