Week 3: Strategize Around Fund Commitments
One of the most common challenges private equity professionals face is managing liquidity during periods of heavy capital calls. The timing of commitments rarely lines up neatly with bonuses, distributions, or exits, which can create pressure on the rest of a portfolio. In this week’s video, I walk through a framework for thinking about how much to commit across multiple funds and how to estimate the capital calls that may follow. The goal is to translate fund commitments into a realistic view of future cash needs.
Chapters
0:09 - Introduction
0:41 - How much to commit to a new fund?
0:51 - Fund Commitment Decisions
2:50 - Fund Commitment Details
4:20 - Fund Commitment Example
4:55 - “Out-of-Pocket” Calculation
6:34 - Aggregate Fund Commitments by Year
7:16 - Fund Commitment Framework
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