The framework only earns its keep against live products. Below are five public vehicles, each decomposed into the four layers using their own disclosures. Note how the manager-compensation layer stays in a fairly narrow band while the distribution layer — the one you control — swings widely.
All-in cost decomposition of five public vehicles (annual, illustrative)
| Fund (structure) | Layer 1: Manager comp | Layer 2: Operating + AFFE | Layer 3: Distribution | Layer 4: Leverage |
|---|
Ares Capital (ARCC)
Traded BDC | 1.5% base on gross assets; 20% income incentive over 7% annualized hurdle (catch-up); 20% capital gains. | Inside the fund; borne via NAV / market price. | None — buy on exchange; brokerage commission only (often $0). | Significant; embedded in results. |
Blackstone (BCRED)
Non-traded BDC | 1.25% base on gross assets ex-cash; 12.5% income incentive over 5% annualized hurdle (100% catch-up); 12.5% realized gains. | Other expenses + AFFE per fee table. | By class: I = 0; D = 0.25% + up to 1.5% upfront; S = 0.85% + up to 3.5% upfront. | Interest expense on leverage — a large part of total annual expense. |
Cliffwater Corporate Lending (CCLFX)
Interval fund | ~1.00–1.13% management fee; no separate incentive fee at the fund level. | Included in a stated Class I total expense ratio of ~1.79% (with AFFE from underlying credit funds and BDCs). | Class I = 0 load / 0 trail; Class A (CCLDX) = 5.00% max load + 0.75% distribution. | Present at the fund level; reflected in the expense ratio and returns. |
WVB All Markets
Interval fund-of-funds | 0.10% management fee (waived ~3 yrs); underlying-fund carry of 10–15% excluded from the stack. | 2.56% other expenses + 0.68% AFFE at launch. | By class; $2,500 minimum; sold through limited channels at launch. | Within underlying private funds. |
Direct PE / VC LP
Private fund | ~2% management fee on committed capital; 20% carry over ~8% hurdle (VC often no hurdle; top-tier carry to 25–30%). | Org / admin / audit / legal charged to the fund on top of the 2%. | None if direct; + feeder layer if accessed via a platform (see Sec. 4). | Fund- or deal-level; strategy dependent. |
Sources: ARCC Form N-2 and advisory agreement (SEC); BCRED prospectus / offering terms and performance disclosures (bcred.com, SEC); Cliffwater Corporate Lending Fund prospectus and fact page (cliffwaterfunds.com; MutualFunds.com, Jul 2026); WVB fund prospectus analysis (Jul 2026); Cambridge Associates 2024 fund-terms benchmarking; Carta / ILPA fee-reporting standards. Figures as of mid-2026; verify against current documents.
The pattern is the lesson. Across four very different wrappers, the management fee lives between roughly 1% and 2%, and incentive economics cluster near a 12.5–20% band. What actually separates a good outcome from a poor one for the client is Layer 3 — whether you accessed the strategy through a no-load Class I / direct LP, or through a loaded broker class or a fee-layering feeder. That is the advisor’s decision, and it is where the framework pays off.
