Typically, VC funds don't have much cash on hand, and when they make an investment, they issue a capital call to the limited partners (LPs) in the fund. The LPs

Typically, VC funds don't have much cash on hand, and when they make an investment, they issue a capital call to the limited partners (LPs) in the fund. The LPs then are on the hook to send money for the investment, typically within a week or two. So, a $100M VC fund is really a commitment by the LPs to wire $100M over the course of ~5-8 years. LPs do all sorts of different things to manage the money they've committed but not yet invested.