What is Preferred return (hurdle)?
A minimum return, often about 8%, that LPs receive before the GP earns carry. Common in buyout, far less common in VC.
Where you will use it: this term comes up in the Entrepreneurial Finance course, and the full course glossary collects every term in one place.
Related terms
From the free Entrepreneurial Finance course by Devon Coombs, CPA, MBA.