Venture Capital is Picking Up Steam

According to the chart below, venture capitalists' capital calls have picked up over the past four quarters.

For those who don't know, a capital call occurs when the General Partners (GPs) of venture capital funds "call" the capital from their Limited Partners (LPs) to distribute funds to a startup to make an investment. Typically, most VC funds' capital is held by LPs and is only transferred to the fund through capital calls when the fund is ready to invest.

Monitoring capital calls is a good metric for understanding the money flows in the startup ecosystem. According to this chart, the rolling 3-month average of called capital surpassed $1 billion in November 2023 for the first time in 16 months.

This is a healthy trend for the startup ecosystem and expect the flows to continue up and to the right.