Jaclyn Hester recommends calling capital as needed rather than upfront, which preserves IRR and the time value of money. For funds with many LPs, a quarterly schedule can work, but the goal is always to match calls to when investments are actually ready to fund.
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So I'd love if you could share some best practices around capital calls in general. Sure. That'd be cool. It's a fun, it's a fun topic I never get asked about. So the way a lot of small funds do it is even like, especially with individual LPs, they'll call it all upfront. The reason you don't wanna call it all upfront is because that's not great from a time value of money perspective. Mm-hmm. And so that crushes your IRR. And so that's why we do capital calls the way we do, which is as needed, like as you scale. Then some will go to quarterly, which I totally understand because the herding cats aspect of if you have a lot of individual LPs. Yeah, like it's a pain in the ass and you can't get to them or they're on vacation and, and you like, you need the capital when you plan to have it. Then you kind of develop further into the as-needed, which is what you're talking about. And that's again, the reason we do that is because you don't want to call the capital until you need to use it because that is, that's capital that's now being kind of measured against timing.
