Venture capital funds make returns for the investors through the various kinds of exits. They occur most often in such a sequence:
IPOs: When such firms are listed on the stock exchange, the shareholders have their shares issued.
Takeover of a portfolio firm by a well-established larger company. These help the VC fund realize and cash in on profits going back to LPs and GPs through carried interest. In other words, some may be paid as dividends or distributions from a profitable portfolio firm.

Venture capital funds make returns for the investors through the various kinds of exits. They occur most often in such a sequence:
IPOs: When such firms are listed on the stock exchange, the shareholders have their shares issued.
Takeover of a portfolio firm by a well-established larger company. These help the VC fund realize and cash in on profits going back to LPs and GPs through carried interest. In other words, some may be paid as dividends or distributions from a profitable portfolio firm.