Sometimes, VCs behave in puzzling ways. Say you’re an entrepreneur, and you’ve made good progress with your company. But, you sense your VC isn’t jumping up and down.

My advice? Take that VC out for a coffee or a meal and ask him/her this question: How are we doing relative to other companies in that fund?

I say this because people speak more freely often when you get them out of their office. And, you need to know roughly where you company stands in the rank ordering of the portfolio. You need to know that VC’s opportunity cost in that particular fund.

As you know, VCs manage fixed pools of money structured as funds. As a VC, you may do cross-fund investing, but that requires a special vote of your LPs from both funds.

That’s possible, but it’s a political gamble, and if the investment doesn’t work out, LPs won’t forget that. One fund’s LPs may feel it was called on to bail out another fund’s LPs.

So, assume those dollars in a fund are fixed.

All VCs “reserve” for their companies. They allocate future capital to each investment. But, know that these allocations change over time.

Let’s say a fund invested in 20 companies. A number have exited or been shut down and you’re down to two companies and have a remaining $20MM in the fund to invest. Each company has been allocated an additional $10MM each.

But, things change.

Let’s say Company A is $50MM of revenue, is growing quickly, and has a shot at going public. But, they need “one last” private financing. They get a great term sheet from a new investor, but here’s the catch. The new investor requests a “pay to play” feature. All insiders must do their full pro-rata, or be wiped out.

Now, let’s further say that your VC’s pro-rata in that round is $15MM, $5MM above the $10MM they’ve allocated.

Let’s further say that Company B has raised $20MM of venture money and the entrepreneur has worked hard to overcome a tough space. But, after all that time, the revenue is about $5MM and largely not growing.

And, let’s assume that you are the founder of Company B.

Your VC now has a decision to make, and it’s probably not going to be up to him/her. The entire VC partnership will weigh in. They’re going to re-allocate $5MM of the $10MM away from you to the other entrepreneur.

The VC firm is simply managing its opportunity costs.

My advice is initiate this topic of conversation with your VC. These are tough talks to have, but, IMO, you’d rather know the truth so that you can manage it.

I continue to believe that true authenticity in a VC-and-entrepreneur relationship is very important.

So, seek the truth, demand it, and work with it.