From the outside, it may seem like GPs (especially in Funds 2-3) alternate between fundraising and investing in neat cycles.
From the inside, it’s obvious: GPS are always raising. They have no choice.
If you run a $25M–$1B fund anywhere between Fund I and Fund VI, you are living under the shadow of 3 ghosts:
1. Re-up risk: If LPs don’t return, you do not raise. If you disengage post-close, your next fund dies in quiet, polite convos that you are not invited to.
2. Deployment pressure: Your pacing narrative needs to fit the current macro mood: bullish enough for confidence, cautious enough for discipline. Most quarters, it fits neither. It's messed up.
3. Portfolio triage: Every follow-on dollar is a "bet against regret:. Do you double down on the not-yet-proven breakout, or hold dry powder for an unknown that might never appear? This is some Camus-type s**t, amirite?
A typical Fund III GP with a $150M vehicle typically relies 70% on re-ups.
That’s $105M from existing LPs.
But even that $105M isn’t automatic. It’s earned through 3–4 years of:
Quarterly updates that show DPI, not just TVPI.
LPAC meetings that feel more like compliance audits than strategic sessions.
One-on-one LP calls where your IR partner is running risk maps on every allocator’s political mood, staffing turnover, and CIO thesis drift.
Meanwhile, you’re sourcing the other $45M from LPs who expect 12–18 months of warm-up before they even consider diligence.
That means you are fundraising even while deployed.
Not metaphorically. Literally.
This isn’t just about optics.
LPs are now in “prove it” mode.
2021 was nearly 5 years ago.
The mark-to-myth era is over.
You’re no longer selling them "upside"
You’re defending the last 18 months of cash conversion.
You can’t turn this machine off.
If you pause LP engagement, your visibility drops below the radar of the next allocation cycle.
If you wait to re-engage until you’re back in market, you’ve already lost.
“Fund IV’s annual meeting deck isn’t about celebration. It’s a pre-emptive defense of Fund V’s right to exist. The IRR isn’t high enough. The cash-on-cash is kinda lumpy. And I still need to convince LPs we have the differentiated filter for AI verticals while explaining why we passed on that deal.”
“We don’t fundraise because we WANT to. We fundraise because it’s EXISTENTIAL. Because the distance between irrelevance and momentum is one messy quarter away. Because if we don’t, no one will remember we were even here.”
TL;DR:
GPs don’t CHOOSE to always be raising. The structure of the game FORCES them to.