A fund term, and a balance sheet without one

A fund is a good instrument for capital that has been raised for a purpose and must be returned on a date. The term is what makes the promise credible to the people who committed the money, and every decision inside the fund is made against that date.

Conventional: A generalist fund
IGUAKO: A mobile balance sheet

Aspect	A generalist fund	A mobile balance sheet
Source of the capital	Committed capital from limited partners, drawn against a fixed term.	US$610 million of proprietary capital, with no redemption date and no drawdown queue.
Term	Ten years and two extensions. The clock starts at the first close and never stops.	None. A position is held for as long as it is the best available use of the capital.
Pace of deployment	The investment period sets the pace. Unspent capital is returned or spent under pressure.	The tests set the pace. Nothing is committed to meet a date in a partnership agreement.
Pressure at exit	Realisations are timed to the life of the fund and to the timetable of the next raise.	Realisations are timed to the asset and to where the proceeds are going next.
How the manager is paid	A management fee on committed capital, then carried interest above a hurdle.	The institution earns on its own capital. Client mandates are priced separately and disclosed.
Sector limits	Written into the partnership agreement and fixed for the life of the fund.	Set by the Investment Committee and revised whenever the underwriting tests point elsewhere.

The institution has no such date. The balance sheet is its own, expansion is funded from realised proceeds, and no position is bought or sold to satisfy a calendar. That is the whole of the difference, and it shows up most clearly at the top and the bottom of a cycle.