---
title: "What Is Wire?"
term: "Wire"
description: "A wire — wire transfer — is the electronic movement of funds between bank accounts, marking the moment investment capital actually lands in a startup's account at round close."
date: 2026-07-25T00:00:00.000Z
updated: 2026-07-25T00:00:00.000Z
topics: ["venture-capital"]
source: https://venturecapitaltracker.com/glossary/wire
---

# What Is Wire?

> A wire — wire transfer — is the electronic movement of funds between bank accounts, marking the moment investment capital actually lands in a startup's account at round close.

**Wire** — short for wire transfer — is how investment dollars move from investor accounts to the company at closing, turning signed documents into spendable cash.

### How it works

Closing sequence:

1. Sign stock purchase agreements and ancillary docs
2. Company delivers closing certificates (good standing, secretary certificate, etc.)
3. Investors initiate wires per side letter instructions — often same-day via Fedwire or SWIFT internationally
4. Company confirms receipt; board approves share issuance

Founders provide wire instructions from the company's bank — verify routing numbers verbally to prevent fraud. Partial closings happen in tranched rounds; each tranche wires on milestone satisfaction.

For fund LPs, [capital calls](/glossary/capital-call) culminate in wires to the fund, then fund wires to portfolio companies — two-hop liquidity.

Delays stem from missing signatures, OFAC checks, bank cutoffs, or holidays. [Verbal commits](/glossary/verbal-commit) are not wires — only the transfer counts for runway math.

### Why it matters

- **Founders:** Announce hires and vendor prep after cleared funds, not at term sheet. Maintain a few weeks buffer for wire delays.
- **Investors:** Operations teams track wire dates for ownership registers and LP reporting; mistakes in amount or entity name require recall and re-send.

### Common mistake

Spending against a term sheet before wires clear — if a investor fails final compliance, you may face a cash gap with obligations already made.

### Related ideas

See also [verbal commit](/glossary/verbal-commit), [capital call](/glossary/capital-call), and closing checklist.

## FAQ

### What is a wire in simple terms?

In fundraising, 'the wire' is when investors send money via bank transfer after legal docs sign. Until funds hit your account, the round is not truly closed.

### Why does the wire matter?

For founders, payroll and vendor payments depend on wired cash, not signed PDFs. For investors, wire timing triggers ownership and capital call accounting to LPs.


---
Source: https://venturecapitaltracker.com/glossary/wire