Distribution

A cash distribution is money an investment actually pays to you; a distribution can also transfer an asset in kind. It is different from the investment's reported value and from cash still held inside a business.

Why distributions matter to your portfolio

An investment can report a higher value or sit on operating cash without sending you anything. A projected payment doesn't pay a bill. Start from what you've actually received and keep expectations in a separate column.

That line ties investment reporting to what you need to spend. Angel, venture, private equity, private credit, real assets and small-business holdings don't share one payout pattern, and a broad allocation label doesn't show whether cash has reached you.

Keep reported value, explanations of retained cash and confirmed receipts apart; each answers a different question. The private portfolio review shows how to match manager updates against your own records instead of trusting the most reassuring description.

How a distribution is recorded

A newly acquired business may hold back cash while the operator learns the business or builds a reserve, which delays investor payback. Cash left after the business's obligations doesn't automatically reach investors.

Holding cash back can be prudent. It still means the money isn't yours to spend yet, and retained cash is no guarantee of a later payment. Ask why it's being kept, and don't treat a healthy cash balance in a company report as money available to you.

For example, suppose a cash distribution arrives. Record the payment date and amount from the notice, then compare them with the deposit in your account record before logging the receipt.

If an update also mentions cash retained in the business, that amount stays out of your receipts. A rise in reported value doesn't mean a distribution happened either. Your account record and the payment notice have to support every receipt you record.

Common mistakes with distributions

Treating business cash as your cash skips the decision about whether money leaves the business. Treating an expected distribution as received skips the payment itself. Both make you look richer in cash than you are.

A distribution also isn't the same as profit. Cash arriving doesn't tell you what the payment represents or how the investment has done overall, and the amount alone doesn't settle its tax treatment; ask your accountant.

Related terms

An unfunded commitment is money you still owe in. A holding period is how long capital stays invested; receiving a payment doesn't mean the investment has ended. The private market portfolio framework ties obligations, receipts and purpose together.

Source notes

The cash-retention explanation comes from an interview and is paraphrased; the example is our own.