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Glossary
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Venture capital fund reserves

What are venture capital fund reserves?

Venture capital fund reserves are the portions of capital that venture capitalists hold back from initial investments to support future funding rounds of their portfolio companies. It's a way to ensure that they can continue to support their portfolio companies through their growth stages.

When a venture capitalist invests in a startup, they don't usually invest all their committed capital upfront. They invest a portion of it and reserve the rest for follow-on investments. These reserves are used to support portfolio companies through future funding rounds, to protect their stake from being diluted, and to provide additional support if the company hits a rough patch. The amount of reserve varies, but it's an important part of venture capital fund management.

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