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Capital Calls App

The capital calls app handles all logic related to calling capital from Limited Partners (LPs), including allocation, fee calling, and reallocation.

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What is a Capital Call?

When LPs enter a fund, they commit to investing a certain amount over time. They don’t immediately transfer the money. When the GP needs capital to operate the fund, they request it from LPs through a capital call.

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Capital Call Flow

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Basic Allocation

Given a fund structure: When the GP calls $100,000 for a deal, capital is allocated proportionally: Step 1: Allocate to Funds Step 2: Allocate to LPs

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Calling for Fees

GPs can collect fees via capital calls. When calling for fees:
  • Allocation is based on accrued fees, not commitments
  • Must call entire quarters of fees (no partial amounts)
  • May include fee true-ups from prior quarters due to closings
During early fund lifecycle with ongoing closings, prior quarter fees may need adjustment due to equalizations and fee true-ups. The system shows balances for previous quarters when applicable.

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Capital Call Reallocation

GPs may initially call capital for general purposes, then reallocate once they know the specific use.

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Why Reallocate?

Different uses of capital (Investment, Legal Fees, etc.) impact:
  • Fee Basis calculations
  • Waterfall calculations
  • LPA compliance

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Reallocation Example

Original call for General Reserves: Reallocated to Investment 1 (50,000)andLegalFees(50,000) and Legal Fees (50,000): The reallocation:
  1. Creates offsetting transactions for the original use
  2. Creates new proportional transactions for the new uses

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Models

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CapitalCallUse

Represents the type of capital being requested: 
class CapitalCallUse(CustomerTimeStampedModel):
    """
    A use represents the type of capital being requested.
    Example uses: Investment, Legal Fees, General Reserves
    """
    fund_family_sub_event = ForeignKey(FundFamilySubEvent)
    use_type = CharField()  # Investment, Expense, etc.
    # Amounts are stored in transactions, not here
Monetary amounts are stored in transactions, not on the CapitalCallUse model itself. This provides a single source of truth.

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Workflow

  1. GP determines total capital needed
  2. System allocates to funds based on commitments
  3. System allocates to LPs within each fund
  4. Notices are generated and sent (see Notices)
  5. LPs wire capital to the GP
  6. (Optional) GP reallocates capital to specific uses

Allocators

How capital is allocated through fund structures.

Notices

Generating and sending capital call notices.

Equalizations

Adjusting allocations when LPs join/leave.

Fees

Fee calculations and calling for fees.