
Dividing Interests in VC and Private Equity Funds in a California Divorce
Carried interest can feel abstract until a divorce brings it into the spotlight. Many spouses know it exists somewhere inside a venture fund or private equity structure, but few understand how California evaluates it or why it becomes one of the most disputed parts of a high-asset case. When a marriage involves fund managers, partners, or early-stage investors, the division of this interest takes careful analysis and a clear understanding of how California’s community property laws apply. These issues become even more significant in a carried interest VC fund in divorce, where the value depends on long-term fund performance and complex compensation arrangements. Below is a clear breakdown of how carried interest works, how courts view it, and why legal guidance matters when VC and privacy equity assets are part of the divorce landscape.

