Fund operations software handles the financial and administrative side of running a venture fund. Capital calls, distributions, LP reporting, portfolio valuations, compliance, and fund performance tracking. This is the infrastructure that keeps your fund running legally and financially.Many smaller funds, especially first-time fund managers, start with Excel spreadsheets. This can work for Fund I when you have a small number of LPs and a handful of investments. But as you scale into Fund II and Fund III, the migration debt piles up. You’re managing multiple funds with different vintages, overlapping LPs with different commitment amounts across funds, and growing portfolio complexity. What was manageable in spreadsheets becomes error-prone and time-consuming.The right time to implement proper fund operations software is before you raise your second fund. Migrating one fund’s historical data is manageable. Migrating two or three funds with years of capital calls, distributions, and portfolio changes is much harder.Unlike research platforms (which some funds might build) or sourcing tools (which some funds don’t need), fund operations software is something every fund needs and should buy off the shelf. This is financial infrastructure. Don’t build it yourself.The main platforms are Carta Fund Forecasting (formerly Tactyc, acquired by Carta), Vestberry, and Standard Metrics. All three handle the core functionality you need. The decision comes down to which one integrates best with your existing systems, which your fund ops team finds easiest to use, and which matches your specific workflow.This chapter covers what fund operations software actually does, how to choose between the main platforms, and how to make the transition smooth for your fund ops team.
Fund operations software handles several core functions that every venture fund needs.Capital management: Track capital commitments from LPs, calculate how much to call from each LP when you need to draw down funds for investments, and maintain records of who has contributed what and when. When you invest in a company, the system helps you calculate the capital call amounts and generate notices. The actual issuance of capital calls and wire transfers typically happens through your fund administrator or banking systems, but the platform tracks everything for your records.Distributions: When portfolio companies exit or return capital, you need to distribute proceeds to LPs according to the fund terms (waterfall calculations, carried interest, management fees). The system calculates who gets what based on your fund’s specific structure and provides the distribution details. Like capital calls, the actual payments are typically handled by your fund administrator, but the platform does the math and maintains the records.Portfolio tracking: Track all your investments. How much you invested in each company, at what valuation, how much ownership you have, what the current valuation is, and what your position is worth. As companies raise follow-on rounds or have markups/markdowns, the system tracks the changes to your portfolio value.LP reporting: Generate quarterly reports for your LPs showing fund performance, portfolio company updates, capital calls and distributions, and overall fund metrics. Most LPs expect standardized reporting. The system produces these reports based on your portfolio and fund data.Valuations and fair value: Mark your portfolio to fair value each quarter. Early-stage investments often carry at cost until there’s a markup event (new funding round at higher valuation). Later-stage funds might need more sophisticated valuation models. The system helps you track valuations consistently and document your methodology for auditors.Fund forecasting: Model out future fund performance. What happens if you deploy capital faster or slower? When will you need to make capital calls? When are distributions likely? What’s the projected IRR and TVPI at different exit scenarios? This helps you manage the fund proactively and communicate with LPs about future expectations.Compliance and audit: Maintain the documentation and records that auditors and regulators require. Track management fee calculations, expense allocations, and financial statements. When your annual audit happens, the system should have everything the auditors need.Fundraising support: Beyond ongoing operations, these systems can generate materials useful for fundraising your next fund. Track record tear sheets, portfolio summaries, performance metrics presented in LP-friendly formats. This becomes valuable when you’re raising your next fund and need to show your track record.
There are three main platforms that venture funds use for operations. All three handle the core functionality. The differences are in user experience, integration capabilities, and specific features.Carta Fund Forecasting (formerly Tactyc): Carta acquired Tactyc and integrated it into their platform. The advantage is tight integration if you already use Carta for fund administration or if your portfolio companies use Carta for their cap tables. Strong fund forecasting and modeling capabilities. The interface is modern and relatively intuitive. Good choice if you’re already in the Carta ecosystem.Vestberry: European-based platform popular with European funds but used globally. Strong portfolio analytics and visualization. Good LP reporting capabilities. Interface feels modern and is relatively easy for fund ops teams to learn.Standard Metrics: Built specifically for institutional LPs and fund managers. Strong focus on standardized reporting and data aggregation across multiple funds.The decision: It really comes down to integrations with your fund management provider and your fund ops team’s preference.
The hardest part of adopting fund operations software isn’t choosing the platform. It’s transitioning your data and getting your fund ops team to actually use it.Onboard your fund ops team first: Don’t surprise your CFO or fund administrator with a new system. Involve them in the decision. Have them test the platforms. Get their buy-in. They need to use this daily. If they find it confusing or harder than their current process, they’ll resist and you’ll end up maintaining two systems.The best implementations start with “what will make this easier for the operations team?” not “what has the most features?” A system they actually use is better than a sophisticated system they work around.Transition quickly: The worst situation is maintaining two systems of record for your fund’s finances. Dual entry creates errors, inconsistency, and extra work. Set a hard cutoff date. Move all data into the new system. Deprecate the old system. Don’t let “we’ll transition gradually” drag on for months.Plan the transition during a quiet period if possible. After you’ve closed quarterly LP reporting but before the next quarter starts. This gives you time to import historical data and verify everything is correct before you need to produce reports.Integration with existing providers: If you outsource some fund operations (to Carta fund administration, for example, or a third-party fund administrator), make sure your operations platform integrates with them. You don’t want to manually enter data from your fund admin into your operations platform. The systems should sync or have clean data import/export.Start with the basics: Don’t try to configure every feature on day one. Get capital management, portfolio tracking, and LP reporting working first. You can add fund forecasting models, portfolio metrics tracking, and sophisticated analytics later. The core operations need to work before you optimize.
Fund operations software isn’t just for managing your current fund. It becomes valuable when you’re raising your next fund.Track record materials: When you raise Fund II, you need to show Fund I’s track record. Portfolio company performance, investment pace, realized returns, DPI and TVPI metrics. A good operations platform can generate these materials in formats LPs expect. You’re not building presentation materials from scratch or manually pulling data from spreadsheets.Portfolio summaries: LPs want to see your portfolio companies, investment dates, check sizes, current valuations, and performance. Operations platforms can generate these summaries automatically with current data. As portfolio companies raise new rounds or exit, the system updates. Your fundraising materials stay current.Performance metrics: IRR, TVPI, DPI, MOIC calculated consistently and presented in standard formats. LPs compare these metrics across many funds. Having clean, auditable data from your operations platform makes fundraising more credible than metrics calculated in spreadsheets.This isn’t the primary reason to implement fund operations software. But when you’re raising your next fund, you’ll be grateful you have clean historical data and can generate track record materials quickly.
Buy fund operations software. Don’t build it. This is financial infrastructure that needs to be correct, auditable, and maintained. Carta Fund Forecasting, Vestberry, and Standard Metrics all work well. Choose based on integration with your existing systems and what your fund ops team finds easiest to use.The exception: very large funds with significant engineering and operations resources have built custom fund operations platforms including LP portals, automated reporting, and investor relations tools. If you’re managing multiple billion-dollar funds with dedicated platform teams, custom infrastructure might make sense. For everyone else, even large established funds, buying off the shelf is the right choice.This is not the exciting part of building a VC tech stack. But it’s essential infrastructure that every fund needs. Get it set up correctly and let it run in the background while you focus on finding and supporting great companies.In the next chapter, we’ll look at portfolio support tools, which help you add value to your portfolio companies after you invest.