The usual problem
In a typical private fund, an investor commits an amount up front and the manager calls that money over several years, often with only a couple of weeks’ notice. Your client has to keep cash ready for calls they can’t predict, and a missed call can carry real penalties.
How a prefunded series works
In a prefunded quarterly series, your client funds their commitment before the quarter starts. The vehicle then meets the underlying fund’s calls from money that is already there.
Each quarter is its own series, so a client can join in the quarter that suits their plan.
What it changes for your client
There are no surprise calls to plan around. You know exactly how much cash leaves the portfolio and when, so you can keep enough aside for upcoming withdrawals and keep the rest invested in line with their plan.
What to discuss with your client
Prefunding means the money is committed on day one, and private market holdings come with a one-year lockup before transfers to other eligible investors are possible. That fits money your client won’t need for some time, which is a conversation worth having before they subscribe.
Educational content only, not investment advice. Examples use sample figures.