Definition
Facilitation Fee
A one-time fee charged at close instead of carry, so the sponsor is paid for the work rather than the outcome.
A facilitation fee is a flat, one-time charge taken at close to compensate a sponsor for assembling a deal, either in place of carried interest or alongside a reduced carry. It suits sponsors doing a favour for a founder, syndicating an allocation they have no strong view on, or running deals where a decade-long carry relationship is not worth the administrative tail. The difference that matters to LPs is directional: a facilitation fee pays the sponsor whether or not the investment works, while carry pays only on profit, so a large facilitation fee reads as weaker alignment. Many sponsors use a hybrid of a small fee to cover hard costs plus standard carry on the upside.