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Tail provision

A clause entitling an intermediary to compensation on capital closing after an engagement ends, where the investor was introduced during it. Commonly twelve to twenty-four months, and a frequent source of disputes where mandates overlap.

Tail provision — A clause entitling an intermediary to compensation on capital closing after an engagement ends, where the investor was introduced during it. Commonly twelve to twenty-four months, and a frequent source of disputes where mandates overlap.

Overlapping tail provisions between two intermediaries engaged sequentially are the single most common source of fee disputes in fundraising — which is exactly why a clear, written carve-out for investors already known to the manager matters before any new engagement begins, not after.

Frequently asked questions

How long do tail provisions typically run?

Commonly twelve to twenty-four months after an engagement ends, though the specific period is negotiable and should be defined clearly in the engagement agreement.

Can tail provisions from two different intermediaries overlap?

Yes, and when they do it's the most common source of fee disputes in fundraising — managers using more than one intermediary should carve out known relationships explicitly in writing before engaging a second one.

Nothing on this page is legal, tax, or investment advice. SeRuM is not a registered broker-dealer, not a placement agent, and not an investment adviser.

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