capital call

Definition

The formal demand from a general partner to limited partners to wire their committed funds, usually with 10-30 days notice and an implied "or else" hanging in the air. It's how venture funds move committed money from promised to deployed.

Example Usage

We issued a capital call for $5M to cover three new investments and fund operations for the next quarter.

Origin

Private equity and venture capital fund management terminology formalized in the 1970s-1980s

Fun Fact

LPs who fail to meet capital calls can face penalties including dilution of their fund ownership or even being kicked out of the fund entirely.

Source: Venture capital fund operations and partnership agreements

Related Terms

Intermediate

prospectus

The glossy sales document that makes every investment opportunity look like the next Amazon and every university look like Hogwarts, carefully balanced between legal obligation and marketing fantasy. In startup land, it's the formal document that transforms 'three guys in a garage with an app idea' into 'disruptive technology platform poised for exponential growth.' Every prospectus contains enough disclaimers to absolve everyone of everything while somehow still convincing you to hand over your money.

🚀 Startup / VC

Advanced

zombie VC

A venture capital firm that's functionally dead but still managing old funds, unable to raise new capital but too undead to fully shut down. They're not investing in new companies but still collecting management fees from their limited partners.

🚀 Startup / VC

Intermediate

Moat

A competitive advantage so strong that rivals can't easily replicate your business, borrowed from medieval castle terminology because startup founders fancy themselves as kings defending their kingdoms. Most startup moats are about as deep as a puddle.

🚀 Startup / VC

Beginner

go-to-market strategy

Your master plan for how you'll actually convince humans to exchange money for your product, typically involving buzzwords like 'omnichannel' and 'vertical integration.' It's the section of your pitch deck you update most frequently as each approach fails.

🚀 Startup / VC

Beginner

graduation

When a startup 'grows up' from an accelerator program or moves from seed to institutional funding, like leaving college but with more awkward Demo Days. Implies you're now playing with the big kids.

🚀 Startup / VC

Beginner

proposition

The fancy business term for a proposal or offer, usually dressed up with adjectives like 'value' or 'unique' to make it sound more impressive than 'hey, wanna buy our stuff?' In startup pitch decks, the 'value proposition' is that one slide where founders explain why anyone should care about their idea, typically using a Venn diagram that doesn't quite make sense. A good proposition answers 'what's in it for me?' before the listener falls asleep.

🚀 Startup / VC

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