Fund economics

Committed Capital

Committed capital is the amount you legally promise to contribute to a fund, whether or not the fund has called it yet. Depending on the limited partnership agreement (LPA), fees may be calculated on commitments during the investment period. If you fail to meet a capital call, default provisions can apply.

Example: A $100,000 commitment remains $100,000 after the fund calls the first $30,000; the uncalled portion is $70,000.

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Knowing the language helps you follow the conversation. Knowing what to ask is how you participate in it.

Understanding the terms is a first step. The Aligned Capital Program uses them to teach you how to evaluate a fund and prepare the questions to ask its manager.

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