> For the complete documentation index, see [llms.txt](https://docs.tactyc.io/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.tactyc.io/portfolio-construction/construction-wizard/exit-recycling.md). # Exit Recycling Optional section if your fund supports future exit proceeds to be re-invested back into new investments. {% embed url="" %} ## Turning on the Exit Recycling provision. Enter the following information: * **What percentage of exit proceeds can be recycled each period? (%):** This is typically 100% * **What is the most the fund can recycle in total? (as a % of committed capital):** The max amount of exit proceeds that can be recycled. Expressed as a multiple of committed capital. For example: a 50% cap implies the fund can recycle up to half its committed capital from exit proceeds. * **The term of the recycling:** i.e. over what timeframe can the fund recycle exit proceeds? * **Allow fund to recycle future exit proceeds ahead of time:** If this is checked, the fund will aggressively make new investments in initial years in anticipation of future exits. If this is unchecked, the fund will wait for exits to occur before recycling can begin. ## What is the difference between Exit Recycling and Management Fee Recycling? Both Management Fee and Exit Recycling will recycle exit proceeds into new or follow-on investments. The only difference between both these methods is the cap up to which the exits can be recycled. * Management fee recycling means the fund can recycle exit proceeds up to the **level of management fees earned to date.** * Exit proceeds recycling means, the fund can recycle exit proceeds **until a certain cap of committed capital is reached.** This cap is typically expressed as a % of committed capital * A fund could exercise both these provisions in their LPA, if they choose to. --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation by asking a question. Perform an HTTP GET request on the following URL with the `ask` and `goal` query parameters: ``` GET https://docs.tactyc.io/portfolio-construction/construction-wizard/exit-recycling.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is what the user is ultimately trying to achieve, the reason they need the answer. Sharing it helps GitBook give you a better, more relevant answer. A goal is most helpful when it describes the outcome the user wants rather than restating the question. For example, with `ask=how do I create an API token`, a goal like `automate deployments from our CI pipeline` lets GitBook tailor the answer to that use case. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.