6 steps to a successful capital call decision
6 steps to a successful capital call decision
Navigating capital calls
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6 steps to a successful capital call decision
Welcome back! 👋
Today we will unpack capital call decisions from start to finish. My goal with this article is to give you a 6 step guide that helps you think through these decisions in the most independent and unbiased way.
Before we dive in, one reminder - don’t be the person who YOLOs on a capital call. This is an investment decision and it’s time to do DD (due diligence). One might even argue that you should do more DD now than you did at the outset, since circumstances have changed both for the deal and the real estate market at large.
This is not a time to make emotional decisions, or give in to scare tactics such as “if you don’t invest we will be forced to foreclose.” In the vast majority (if not all) of cases, you’re not the only LP and, besides that, LP capital isn’t the only available option for capital needs for a GP. Try your best to make a logical decision - I hope the below will help you get there!
Alright, let’s dive in.