Fund Structure
Called Capital
The portion of an LP's committed capital that the GP has actually drawn down through capital calls — as opposed to committed but not yet transferred capital.
When LPs commit to a fund, they don't wire all the money at once. The GP calls capital over time as investment opportunities arise, typically over a 3-5 year investment period. Called capital is what has actually been transferred; uncalled capital is the remainder of the commitment still outstanding.
LPs must maintain liquidity to meet capital calls on 10-15 business days notice. Defaulting on a capital call has severe penalties including forfeiture of fund interest.
In Practice
An LP commits $10M to a fund. Year 1: $2M called. Year 2: $3M called. Year 3: $2.5M called. After three years, $7.5M is called capital and $2.5M remains uncalled — but the fund retains the right to call it during the investment period.
Why It Matters
For LPs, managing liquidity around capital calls is a core operational challenge — particularly when multiple funds call capital simultaneously during market downturns when liquidity is scarce.