What is a re-up?

Re-ups usually come out of an investor’s annual review of a manager’s track record, reporting and team, and often precede or follow the first close of the successor fund. The commitment may be larger, smaller or flat versus the prior fund. Re-up rates are sometimes counted by investor number and sometimes by dollars committed, which can give different answers.

Say a manager’s fourth fund has 100 investors and 85 of them commit to the fifth. Its re-up rate is 85%.

A strong re-up rate lets a manager raise its next fund faster, and a weak one is often the first sign of trouble.