The Commitment Decay Function
LP conviction weakens fastest between soft commits and first close—the stretch where most African funds lose momentum.
Last week’s piece explored GP Valley—the stretch between early LP interest and real momentum, where most emerging managers stall. But surviving GP Valley only gets you to the next checkpoint. What happens after that is far more unforgiving.
Soft commits don’t end the struggle. They mark the start of a different kind of risk: the period where time drags, documents move slowly, and LP conviction begins to fade. It’s here—not in the pitch room—where many African funds actually fail.
This week, we dive into that zone.
A West African GP I know spent 18 months assembling what looked like a flawless first close. Eight soft commits. Forty-two million dollars against a $30m target. Strong pipeline. Credible anchor.
Then the timeline slipped.
Month three: “Just finalizing documentation.”
Month six: three LPs requested bespoke side letters. The anchor’s legal team went silent.
Month nine: one LP’s IC approval expired. Two others hit denominator constraints as their portfolios compressed.
Month twelve: the fund missed the deployment window that justified its thesis. Two LPs withdrew.
The fund never closed.
The GP returned to consulting.
Competitors funded the pipeline.
The outcome followed the timeline dynamics at play, not random misfortune.
The Half-Life of LP Conviction
Most GPs assume fundraising ends once soft commits are secured.
That’s usually when things become fragile.
LP commitments behave like decaying call options. At soft commit, LPs are underwriting a future fund—your thesis, timing, capability. Each week of delay pulls the evaluation backward: what has changed, how markets shifted, what new risks appeared.
In African markets, this decay happens faster.
Conversion probability drops sharply beyond 90 days—not because GPs lack skill, but because the ecosystem doesn’t absorb delay well.
During slippage:
IC members rotate
Portfolio allocations rebalance
Competing opportunities arise
Denominator effects freeze commitments
Regulatory cycles force pauses
FX volatility triggers capital protection
Internal LP priorities shift
LPs don’t usually walk away because of the GP.
They walk because the world around them moves while the closing timeline stalls.
In a market still developing its institutional muscle, those shifts stack up quickly.
The Infrastructure Gap That Extends Every Timeline
In developed markets, LPs review structures they’ve seen many times.
Legal review becomes variance detection.
African fund formation is a different reality.
Each GP uses a different jurisdiction, counsel, and precedent. LPs must underwrite unfamiliar structures from scratch. Reviews that take a few weeks in the US often stretch to months for African funds.
Fund administrators in mature ecosystems have decades of pattern recognition.
African administrators are still building that memory. Routine processes stall over misunderstood compliance requirements or incomplete documentation.
Add to this:
Multi-jurisdiction approvals
Cross-border tax interpretations
Multi-currency subscription flows
Intermediary bank hurdles
Several time zones per call
LP domiciles with inconsistent compliance expectations
Wiring money becomes a process with moving parts, not a single action.
The pattern reflects the operating environment more than the GP’s capability.
Six Interdependent Choke Points
These issues pile onto each other.
The Anchor Problem
Nobody wants to wire first.
Everyone waits for the anchor, and the anchor moves at its own rhythm.
A big-name anchor improves optics but often slows execution.
A slow anchor cuts momentum off at the knees.
LPA Negotiation Drift
Without a common template, every LP negotiates from scratch.
Small changes trigger MFN reviews, which then force re-negotiations.
Weeks disappear.
Side Letter Sprawl
An LP asks for reporting tweaks.
Another asks for co-invest rights.
MFN spreads concessions across the table.
Complexity rises.
Operational load increases.
Timelines slip.
Regulatory Timeline Ambushes
Structures that look tidy on paper get stuck in approvals, reviews, and due diligence loops.
Each one adds time.
Subscription Document Failures
Typos, incorrect entity names, missing bank details, incomplete tax forms—simple issues that stall LPs who are otherwise ready to wire.
Capital-Call Timing Collisions
Some LPs can only wire on particular calendar dates or within certain fiscal windows.
Portfolio companies rarely wait for that.
Fix one choke point, another surfaces.
How Sophisticated GPs Stay Alive
GPs who consistently close in Africa recognise one thing:
They can’t rely on infrastructure that isn’t there.
So they build around it.
Minimum Viable First Close
Identify the smallest amount required to execute early deals, cover two years of fees, and demonstrate discipline.
Close with LPs who can move.
Momentum attracts additional capital.
Diversified Anchors
Instead of relying on one slow-moving institution, they assemble multiple mid-sized LPs who execute faster.
This spreads risk and increases wiring pressure.
Pre-Aligned LPA Terms
Before launching a raise, they run the LPA past a small group of sophisticated LPs to resolve major issues early.
They start with a near-final document.
Controlled Side-Letter Hierarchies
They define who gets to negotiate and limit what triggers MFN.
This prevents a cascade of unintended obligations.
Regulatory Realism
They choose structures that execute quickly rather than ones that look perfect on paper.
They secure informal clarity to avoid timeline surprises.
Operational Precision
They test subscription docs with friendly LP operations teams, rehearse wire paths, map approval calendars, and coordinate capital calls accordingly.
This is less about “best practice” and more about staying alive.
One GP built a first-close control room with a project manager tracking 40+ interdependent tasks.
They closed in 11 weeks while peers drifted.
The Governance Pattern You Set on Day One
First close brings in capital, but it also establishes the patterns that will guide the fund for years.
Every concession—co-invest rights, reporting terms, vetoes, MFN scope—becomes the baseline for every future LP.
If you give early LPs too much room just to get over the line, you inherit a governance structure that limits you for the rest of the fund’s life.
Those decisions shape downstream liquidity:
Slow first close → slow deployment → slow maturity
Broad co-invest rights → reduced capacity to support winners
Side-letter tiers → conflicting liquidity expectations
Early concessions → weaker leverage later
First close sets the tone for the next decade.
Next: The Gated Edition on First Close Mechanics
The midweek paid edition will go deeper:
The specific LPA terms that drive negotiation drift
Side-letter structures that avoid MFN spirals
A practical sequencing model for managing multiple LPs across jurisdictions
Subscription-document checklists that prevent operational failures
Regulatory navigation frameworks suited to African fund pathways
Anchor-management tactics that convert interest into action
Today’s piece is the mental model.
The gated edition is the operating manual.
African first closes run on time arbitrage in imperfect conditions.
The GPs who make it through are the ones who design around fragility.