Alternative Investment Glossary

Asset classes outside public equities and fixed income: private equity, venture capital, private debt, real estate, hedge funds. Illiquidity, limited disclosure, and long holding periods set them apart from liquid public-market positions. Because each administrator and fund operates independently, consolidating data across an alternatives book requires connecting to multiple portals — each with its own format and session.

A periodic statement from a fund administrator showing an LP's running balance: contributions, distributions, unrealized gains and losses, and fees. Delivered through the administrator's portal, usually quarterly. Elementar extracts the data within these statements — NAV, contributions, distributions and fees — from your fund-administration portals automatically.

A formal notice from a GP instructing LPs to transfer part of their committed capital by a set date. Timing and amounts aren't predictable — they depend on when the fund has identified an investment or needs to cover expenses. Missing or misreading a capital-call notice carries real consequences for an LP. Elementar extracts capital-call notices across all your administrators and tracks them in one view — see how on the platform overview.

The total amount an LP legally agrees to invest over a fund's life, drawn down through successive capital calls. Your total commitment determines how much unfunded capital remains at any point. Elementar tracks committed capital per fund and per administrator, so your unfunded exposure is in one place, updated twice daily.

A return of capital or profit from a fund to its LPs. Distributions can be in cash (most common) or in kind. The timing and size depend on when the GP exits an investment, following the fund's distribution waterfall. Elementar extracts distribution notices and records date, amount and currency, normalized across 8 currencies.

The contractual order in which proceeds from fund exits are split between the GP and LPs. A typical waterfall first returns all contributed capital to LPs, then pays any preferred return (hurdle rate), and finally splits remaining profits between LPs and the GP under the carried-interest terms. Understanding the waterfall structure for each fund helps model when and how much cash is likely to flow to LPs.

Total distributions received, divided by total capital contributed (paid-in capital). DPI measures realized return only — the cash you have actually received back. A DPI of 1.0 means you have recovered your full invested capital in cash; above 1.0 means you are in profit on a realized basis. Compare DPI against TVPI to understand how much value is already in cash versus still unrealized.

Distributions plus remaining NAV (the residual value of the fund), divided by total capital contributed. TVPI captures the complete picture — both realized and unrealized value. Where DPI tells you what you have received, TVPI tells you what you have plus what the fund estimates is still there. The gap between TVPI and DPI represents unrealized, illiquid value.

Total value (distributions plus remaining NAV) divided by capital invested, expressed as a multiple — e.g. 2.5×. MOIC is a clean absolute return measure but ignores the time it took to generate that return. A 2.5× over three years is a very different outcome from a 2.5× over ten. Always pair MOIC with IRR to assess the time dimension.

The discount rate that sets the net present value of all cash flows (capital calls in, distributions out, plus residual NAV) to zero. IRR is the standard time-weighted return measure for private funds and directly accounts for when money was called and returned. Read IRR alongside DPI and TVPI: IRR shows efficiency; DPI and TVPI show magnitude.

The GP's share of fund profits, commonly around 20%, paid after LPs receive their capital back and any preferred return (hurdle). Carried interest is the primary performance incentive for GP teams and is governed by the fund's limited-partnership agreement. Understanding the carry structure helps LPs model when GP economics kick in relative to their own returns.

The minimum annualized return LPs must receive before the GP earns carried interest. A common hurdle is 8% per year. Until that threshold is met, all profits flow to LPs. Once it is met, the GP begins to earn its carried interest on subsequent returns. The hurdle rate and any catch-up provisions are defined in the fund's LPA.

The manager that raises the fund, sources and manages investments, and is responsible for all fund-level decisions including when to issue capital calls and when to make distributions. The GP has unlimited liability within the fund structure (in contrast to LPs, whose liability is capped at their commitment).

An investor in the fund — typically a family office, endowment, pension, or institutional investor — whose liability is limited to its committed capital. LPs receive capital-account statements, capital-call and distribution notices, and periodic NAV updates from the fund administrator. They do not participate in day-to-day fund management.

A third-party firm handling a fund's back office: maintaining the LP register, calculating NAV, processing capital calls and distributions, producing investor statements, and handling regulatory filings. Family offices often hold positions across six or more administrators, each running a separate portal with no shared data feed. Elementar connects to 16 fund-administration portals today — no API or IT integration required — and normalizes the data into one unified view. See the portals Elementar supports.

The act of a GP calling committed capital from LPs — also referred to as a capital call. "Drawdown" is also used to describe the cumulative capital drawn to date (e.g. "the fund has drawn down 60% of committed capital"). The remaining portion is unfunded capital. Drawdown pace varies by fund strategy: buyout funds often draw capital faster than venture funds with longer deployment timelines.

The early-years pattern where a fund's net return is negative — capital is called and deployed into investments, management fees begin to accrue, and exits have not yet generated distributions — and then inflects upward as the portfolio matures and cash is returned to LPs. The resulting shape on a time-return chart resembles the letter J. This is a structural feature of closed-end private fund investing, not a sign of underperformance. Investors familiar with the J-curve plan their liquidity accordingly and assess fund performance relative to its vintage year cohort.

A fund's total assets minus its liabilities at a point in time, calculated by the fund administrator and reported periodically — usually quarterly. NAV represents the estimated current value of your fund position before any future distributions. It is the numerator for the unrealized portion of TVPI. Elementar extracts NAV across all administrators, normalized into 8 currencies in one dashboard.

The cumulative capital you have actually transferred to a fund in response to capital calls. Paid-in capital is the denominator in both DPI and TVPI: it represents what you have truly put at risk. Distinguished from commitment, which is the total amount pledged but not yet necessarily transferred. Elementar tracks paid-in capital alongside the full commitment and unfunded balance.

The uncalled portion of your commitment — the amount a GP may still call at any time over the fund's investment period. Unfunded capital is a contingent liability that must be funded on short notice when a capital call arrives. Monitoring it across all funds and administrators is essential for liquidity planning. Elementar surfaces unfunded capital per fund alongside commitments and paid-in capital, updated twice daily.

Ownership of private companies through structured fund vehicles. Private equity typically targets mature companies via buyout or growth strategies; venture capital focuses on early and growth-stage companies. Both structures report returns to LPs through capital account statements and periodic NAV reports from fund administrators. The illiquid, long-dated nature of these funds makes accurate, consolidated data tracking especially important for portfolio oversight.

A private firm managing wealth for one family (single-family office, SFO) or several unrelated families (multi-family office, MFO). Both typically hold significant alternative-investment allocations across many GPs and fund administrators — which creates a substantial data-consolidation burden each reporting cycle. See Elementar for family offices and for multi-family offices.

The year a fund made its first capital call or its first investment. Vintage year is used to group and compare funds that deployed capital in the same market environment — since market conditions at deployment substantially influence final returns. Comparing a 2019 vintage fund against a 2021 vintage fund on raw IRR alone ignores the very different conditions each faced.