By: Laura Sankowich
Allvue Marketing Thought Leadership and PR
July 9, 2025
In today’s competitive private capital environment, attracting and retaining top talent requires more than just strong performance, it demands clear, compelling compensation structures. In a recent feature in Private Funds CFO, Richard Change, Head of PFA Solutions, (an Allvue company), shared new survey findings that reveal how general partners (GPs) are evolving their approach to compensation benchmarking and carry allocation.
Compensation Benchmarking Gains Ground in Private Capital
According to the survey, the industry is reaching a tipping point:
- 45.6% of alternative asset firms are now using compensation benchmarking
- Another 45.6% are not
- 8.8% remain unsure
This near-equal split marks a major shift from past norms, where most firms avoided benchmarking due to data limitations or lack of standardization. But as competition for investment talent intensifies, firms are looking for ways to ensure their carry plans and total rewards are both competitive and transparent.
“Dollars at Work”: A Simpler Carry Allocation Method
One of the biggest drivers making compensation benchmarking more accessible is the growing adoption of the “dollars at work” methodology.
Instead of quoting carry allocations in percentages or fund points, GPs are increasingly expressing awards in actual dollar amounts. This makes the value of carry clearer for employees and easier for firms to benchmark against the market.
“There’s not a published set of data or benchmarks out there that exist,” said Richard Change, Head of PFA Solutions (An Allvue Company). “But as more firms adopt simpler carry methodologies like ‘dollars at work,’ benchmarking is becoming more accessible and impactful.”
In the survey, nearly 35% of respondents said they prioritize the dollars at work approach, making it the second-most common methodology after traditional percentage-based allocations.
Transparency Gaps in Total Rewards Communication
Despite a move toward better benchmarking and simpler carry communication, the survey also uncovered a key gap: 51% of firms don’t offer total rewards statements to their employees.
These statements provide a consolidated view of compensation, including salary, bonuses, carry allocations, and co-invest opportunities, allowing employees to see the full value of their compensation packages. As firms scale and expand globally, creating these unified statements becomes more complex but more important.
Offering total rewards transparency is becoming a top priority for firms that want to improve employee engagement and retention.
Hybrid Carry Waterfalls Reflect Strategic Flexibility
The survey also revealed that firms are moving beyond rigid carry allocation models. While the European waterfall (fund-level carry) and American waterfall (deal-by-deal carry) remain dominant, a growing number of sponsors are adopting hybrid carry waterfalls, a blend of both approaches.
This strategy allows firms to allocate deal-specific carry while maintaining a broader fund-level structure, offering more flexibility and precision, especially for GPs focused on technology and growth strategies.
Allvue’s Role in Evolving Compensation and Carry Practices
With more than $8.5 trillion in assets tracked, 21,000+ funds, and 500+ global clients, Allvue Systems is uniquely positioned to support private equity, private credit, and venture capital firms in modernizing their compensation and carry strategies.
FirmView® has the capability to deliver deep expertise and real-world insights that help GPs:
- Benchmark compensation packages with confidence
- Simplify and personalize carry communication
- Implement flexible carry waterfalls that align incentives
Read the Full Feature in Private Funds CFO
Want to dive deeper into these trends and see how leading firms are responding? Read the full article in Private Funds CFO.
Whether you’re rethinking your GP carry model, launching a new fund, or simply looking to improve transparency across your team, the data from FirmView offers a valuable lens into what’s next for private capital compensation. Talk to our team, or get a demo.
More About The Author
Laura Sankowich
Allvue Marketing Thought Leadership and PR
An expert in digital strategy, content marketing, PR, and thought leadership, Laura brings more than 20 years of B2B marketing and communications experience to Allvue. Laura has extensive experience working for both publicly and privately held Fintech firms.
