Capital Call / Drawdown (Capital Call) - Private Equity Glossary | LP Data

A capital call (also known as a drawdown) is a formal request from the General Partner for Limited Partners to contribute a portion of their committed capital to the fund. LPs typically have 10-30 days to fulfill capital calls.

How capital calls work

1. GP identifies investment opportunity
2. GP sends capital call notice to all LPs
3. LPs transfer their pro-rata share
4. GP deploys capital into investment

Capital call management

Calls are typically 5-15% of commitment each
May occur multiple times per year
Must be fulfilled regardless of LP's liquidity situation
Default can result in severe penalties

For LPs

Managing capital call timing is a key part of private equity allocation strategy, as LPs must maintain sufficient liquidity to meet calls.