Fund life is the clock on a venture fund—the full span from launch to wind-down during which GPs can invest, manage, and must eventually return capital to LPs.

How it works

Standard US venture funds often run ten years from initial close, with optional one- or two-year extensions approved by LPs. Early years focus on new investments during the investment period—commonly the first three to five years. After that, the GP typically may not make new platform investments but can support portfolio companies with reserves. Later years emphasize exits, secondaries, and write-offs. If assets remain unsold, GPs negotiate extensions or wind down through structured sales. Fund life differs from fund vintage, which marks the year of first close but does not alone tell you how much runway remains.

Why it matters

• Founders: Late-stage funds in year eight behave differently from fresh vintages—they may prioritize liquidity over new bets or have limited dry powder for follow-ons.
• Investors: LPs model cash flows and DPI timing around fund life. GPs fundraising for the next vintage often align with the prior fund entering harvest.

Common mistake

Assuming a famous brand name means unlimited time and capital. Each fund is a discrete vehicle with its own life, reserves, and LP obligations.

Related ideas

Investment period, fund extensions, fund vintage, and recycling provisions.