A fee offset reduces the management fee by some or all of what the manager charges the fund's own companies.
What the film says
In private equity, a manager can bill the companies it owns. Who keeps that money? That's the fee offset. Say the management fee is twenty million a year. The manager also charges a company it owns four million. Under a full offset, that four comes off the fee. Investors pay sixteen. The manager still gets twenty in total. Investors keep four. So why do investors care? Without it, the manager could keep both. The offset decides who keeps those fees.
In the glossary: Management fee offset
A simple example with round numbers, not advice. Terms vary by fund.
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