For an equity investor, an investment ticket means more than the amount transferred to a company. It determines how much of the vehicle's capital is exposed to one investment thesis, which rights can be negotiated and how much additional money may be needed. A small investment can require expensive monitoring; a large one can consume reserves needed elsewhere. Position sizing must therefore combine the initial payment, possible future commitments, economic concentration and the ability to support the investment through an uncertain exit.
Start with the mandate and the capacity to absorb losses
This article considers companies and instruments eligible under the vehicle's mandate, with rights and influence consistent with the applicable rules. Brazilian Fundos de Investimento em Participações, or FIPs, operate within the framework of CVM Resolution 175, its Annex IV and their own fund rules. This framework matters: a FIP is not simply a vehicle for advancing money against receivables. Acquiring equity, subscribing to a convertible instrument and purchasing a credit claim require separate assessments of their nature, eligibility and consequences.
The educational purpose is to turn an investment thesis into verifiable limits, without prescribing personal asset allocation. A defensible position must answer three questions: can the asset enter the portfolio, do its rights support appropriate monitoring and influence, and does the fund have the money and time to handle disappointing results? A negative answer cannot necessarily be fixed by writing a smaller cheque. It may require a different instrument, another structure or abandoning the transaction. No position size guarantees approval, repayment, profitability, liquidity or preservation of capital.
Define the exposure before calculating percentages
One project may span several legal entities, contracts and instruments. The operating company might receive investment while a related entity owns the brand and another holds property or technology. Treating each Brazilian corporate registration, or CNPJ, as an independent position can understate exposure to the same business. Define the economic perimeter first: which cash flows, assets, guarantees, controlling owners and dependencies belong to the thesis? The project limit should reflect that perimeter even when the transaction involves several entities. This analysis does not make those entities legally interchangeable.
The denominator also needs an explicit definition. A R$ 10 million investment represents 10% of R$ 100 million in total commitments, but approximately 11.1% of a R$ 90 million investment budget. A percentage based on reported net assets may change with valuations, expenses and capital calls. Each measure answers a different question. Proposals should disclose their denominators consistently, allowing the committee to distinguish an allocation against promised capital from exposure against capital actually available for investment.
Indirect exposure matters too. Two portfolio companies may depend on the same major customer, critical supplier or public contract, despite operating in different sectors. A common disruption could affect both at once. Managers should therefore monitor limits by company, economic group and shared risk factor. Adding investment tickets shows the money committed; mapping dependencies reveals where losses could accumulate. Useful reporting to fund investors includes both views and explains what action would follow if an exposure approached its limit.
Treat asset eligibility as an entry requirement
Before discussing valuation or a desired ownership percentage, identify exactly what the fund would acquire. An investment in the company is not a sufficient description. Is it newly issued equity, an existing owner's stake or an instrument that may convert later? Who receives the money? Which rights arise immediately, and which depend on future events? The investment and legal teams should assess the structure against the FIP's applicable rules and fund documents, recording their analysis before entering a binding commitment.
The company's legal status also matters. A business informally described as a partnership may have a legal form incompatible with the proposed investment. A Brazilian individual microentrepreneur, or MEI, cannot admit equity partners while remaining a MEI. Any necessary reorganization must actually occur and be examined before an ownership interest is treated as available. Similarly, buying a founder's existing equity sends money to that seller; it does not automatically strengthen the company's operating cash. That distinction changes both the required ticket and its economic justification.
Existing eligible receivables differ from hoped-for future sales. An expansion plan based on contracts not yet signed still carries commercial risk, even if presented as predictable collections. Loans, receivables, equity, convertibles and donations establish different rights, payment expectations and loss exposures. A nonprofit donation is neither an equity investment nor a promise of financial return. The first sizing control is accurate classification: convenient labels must not substitute for identifying the asset, the recipient of the money and the rights actually created.
Build the vehicle's budget before negotiating individual deals
Consider a wholly hypothetical vehicle with R$ 100 million in commitments. Its plan allocates R$ 10 million to fund expenses and obligations, R$ 60 million to initial investments and R$ 30 million to follow-on investments. These are arithmetic assumptions, not market standards, fees or recommended allocations. The R$ 90 million investment budget must accommodate first investments and the continued funding of selected businesses. Losses on some positions may be unrecoverable, so those amounts cannot be assumed to return and finance other projects.
Within that budget, the manager considers investing R$ 6 million initially in one company, with another R$ 4 million potentially available later. Its planned total envelope is R$ 10 million. That leaves R$ 54 million in the initial-investment budget and R$ 26 million in follow-on reserves for other projects. The first cheque equals 10% of the R$ 60 million initial-investment budget. The complete envelope equals 10% of total vehicle commitments. These percentages happen to match, but their denominators and purposes are different.
A R$ 30 million reserve does not give every portfolio company an automatic entitlement to funding. A plan may express an intention without creating a contractual obligation. The committee must distinguish legally committed capital, funding subject to conditions and amounts considered only in scenarios. This prevents the same reserve from being implicitly promised to several companies. It also makes a new opportunity comparable with existing positions that still require monitoring, expenses or further investment decisions. The relevant question is what remains available after those demands are recognized.
Connect the cheque to uses of funds and a verifiable milestone
In the example, the first round raises R$ 8 million: R$ 6 million from the FIP and R$ 2 million from a co-investor. The company allocates R$ 3 million to product development, R$ 2 million to commercial capabilities, R$ 1 million to working capital, R$ 1 million to internal controls and R$ 1 million to contingency. These five items total exactly R$ 8 million. A balanced budget, however, does not establish that the amounts are sufficient or that the activities will generate demand.
Diligence should convert each line into testable assumptions. Development needs deliverables, accountable people and dependencies. Commercial expansion needs an explanation of the sales cycle and the cost of fulfilling contracts. Working capital requires collection and payment assumptions. Contingency should address uncertainty rather than hide known omissions. If progress depends on a licence, intellectual property that has not been transferred or an irreplaceable supplier, that dependency belongs in the path to the next milestone. Otherwise, an apparently funded plan may still lack an essential input.
The appropriate first investment depends on what it can accomplish. Financing only part of an indivisible stage can leave the company without money before it produces the expected evidence. Funding all expansion immediately, however, reduces opportunities to reassess. A useful milestone resolves a material uncertainty and supports a later decision to expand capacity, change strategy or end the thesis. Revenue alone may be a weak milestone when accompanied by overdue payments, excessive discounts or negative margins. Evidence should show whether progress improves the business's economics.
Calculate ownership and reconcile the capitalization table
Assume the initial round values the company at R$ 24 million before the investment. Adding R$ 8 million in new capital produces a post-money valuation of R$ 32 million. The FIP's R$ 6 million investment buys 18.75% in this simplified calculation. The co-investor receives 6.25%, leaving previous holders with 75%. Together, these interests total 100%. The assumptions exclude options, convertibles, different economic share classes and other adjustments. A real transaction would need to incorporate any such items before relying on these percentages.
The price paid does not, by itself, establish influence. An 18.75% interest might carry representation on governance bodies, information rights and specific approval rights over certain matters. Those rights depend on valid, negotiated arrangements. They do not give the fund control over every decision. Ticket analysis should separate economic ownership, voting power, contractual protections and the practical ability to exercise them. A minority position can require substantial oversight without providing the authority to direct the company's ordinary operations.
A reliable capitalization table reconciles documents, formal records and outstanding commitments. Ignoring an option promised to executives can overstate the stake being acquired. An older convertible instrument may also change dilution through its conversion terms. Resolve these issues before fixing the final price: reconstruct ownership, simulate relevant events and adjust contracts accordingly. An informal valuation discount cannot replace knowing how many interests exist, who may receive more and what preferences attach to them. The percentage should be the result of that reconciliation, rather than an unsupported negotiating assumption.
Size reserves around economic need, rather than attachment to the thesis
The R$ 4 million follow-on envelope should come from scenarios, rather than a desire to preserve ownership at any cost. Suppose the company achieves some initial objectives and proposes a R$ 10 million round at a R$ 40 million pre-money valuation. Its post-money valuation becomes R$ 50 million. If the FIP does not participate, its existing 18.75% becomes 15%, assuming the same simplified ownership structure. That dilution is a consequence to evaluate, rather than an automatic reason to invest again.
If the fund contributes its reserved R$ 4 million and other investors provide R$ 6 million, the calculation changes. The old holding represents R$ 7.5 million of the R$ 40 million pre-money value. Adding R$ 4 million gives R$ 11.5 million against R$ 50 million after the round, or 23%. Merely maintaining 18.75% would require R$ 1.875 million, equal to 18.75% of the R$ 10 million raised. Investing R$ 4 million therefore increases both exposure and ownership; it does more than prevent dilution.
The committee should make that distinction explicit and compare the follow-on with alternatives, including investing nothing further. Money already invested affects existing rights and consequences, but does not make another cheque economically sound. If the business has deteriorated, defending a percentage may increase the eventual loss. Unless contractual obligations apply, a reserve preserves an allocation option. Release it when evidence supports the relationship among price, cash need, governance and possible exit. A larger ownership percentage is useful only in connection with the value and risks of the underlying business.
Put capital calls and company disbursements on one schedule
Investor commitments, cash held by the fund and cash held by the company are different quantities. Suppose the vehicle schedules a first capital call of R$ 38 million: R$ 36 million for initial investments and R$ 2 million for expenses. The project's first R$ 6 million is included within that R$ 36 million. A second call of R$ 26 million then covers the remaining R$ 24 million of initial investments and another R$ 2 million of expenses. Cumulative calls reach R$ 64 million.
A third hypothetical call of R$ 14 million funds R$ 12 million of follow-on investments and R$ 2 million of expenses. The project's second-round R$ 4 million forms part of those R$ 12 million. Total calls now equal R$ 78 million. Of the original commitments, R$ 22 million remains uncalled: R$ 18 million for follow-ons and R$ 4 million for expenses. The schedule reconciles to the original R$ 60 million for initial investments, R$ 30 million for reserves and R$ 10 million for costs.
This schedule illustrates the arithmetic; it is not a forecast or a liquidity assurance. An acquisition may accelerate, a condition precedent may delay closing, or a company may use cash faster than expected. Management needs to monitor call notice periods, binding obligations and a practical margin for timing differences. Calling capital too early also has economic consequences. An updated projection should distinguish unavoidable payments, conditional disbursements and discretionary opportunities, with someone responsible for recording each change. An uncalled commitment should never appear in a report as if it were already available cash.
Make governance produce information and usable decisions
Governance rights can reduce information gaps, but only when implemented. An agreement may require monthly reporting; if accounts close late and contracts are scattered, the manager still makes decisions with poor information. Before increasing a ticket, assess whether the company can produce coherent financial statements, reconcile cash, identify related parties and explain deviations. Building that capability has a cost that belongs in the investment thesis, with a budget, timetable and responsible people. A reporting clause alone does not provide reliable management information.
Reserved matters require careful design. Borrowing, issuing new equity, selling material assets and entering related-party transactions may warrant specific approval mechanisms. An excessive list of vetoes, however, can obstruct operations and send routine decisions to the fund. The aim is to protect decisions that materially change economic exposure while allowing ordinary operations to function. Approval limits, materiality thresholds and urgent procedures should fit the company's circumstances. Rights that cannot be applied in practice may create disputes without providing the intended protection.
The manager's own capacity also sets a limit. Monitoring many small holdings can require more work than monitoring fewer large ones, particularly where controls are weak. A board seat offers little practical protection without preparation, review of materials and recorded decisions. Portfolio planning should consider how many companies the team can follow effectively, not just how many tickets fit the capital budget. The influence required by the structure must be supported by actual people, relevant expertise and available time. Otherwise, growing the portfolio can weaken oversight across existing positions.
Measure concentration through shared losses and exit constraints
A nominal project limit is necessary, but does not capture every form of concentration. Imagine three businesses, with different investment tickets, selling into the same commercial chain. Falling orders could simultaneously reduce revenue, increase inventories and create additional funding needs. The portfolio might appear diversified by activity while remaining dependent on one source of demand. Managers should test the effect of that source failing and several companies requesting capital together. The risk lies partly in the timing and correlation of those requests.
Exits can be concentrated too. If several investment theses rely on sales to the same small group of strategic buyers, a contraction in that acquisition market could affect the entire portfolio. The fund's life may also clash with business development timelines. A company requiring prolonged industrial investment does not become liquid because the fund needs to distribute cash. This mismatch should influence the first ticket, total envelope and contractual exit alternatives. A plan should acknowledge that available buyers and acceptable sale terms can change.
The project's R$ 10 million envelope must therefore be assessed alongside other holdings and the R$ 26 million initially reserved for them. If several businesses depend on the same economic conditions, those reserves may be inadequate precisely when most needed. Possible responses include reducing new-investment envelopes, seeking co-investment or declining highly correlated opportunities. The appropriate response depends on the mandate and contracts. Diversification can change the pattern of exposure, but it neither eliminates losses nor ensures buyers will be available when the vehicle wishes to exit.
Stress-test the business before treating reserves as the answer
Suppose sales fall below plan after the first investment and customers take longer to pay. The issue is more than lower revenue: cash arrives later while payroll, supplier invoices and other expenses remain due. Analysis should distinguish a temporary funding gap, an underestimated budget and structural deterioration in margins. A follow-on might finance a plausible recovery or merely prolong an economically unsustainable operation. Evidence about contracts, costs and customer behaviour is needed to tell the difference. The existence of a reserve answers neither question.
In an alternative downside scenario, the company asks the FIP for R$ 6 million instead of the planned R$ 4 million. The extra R$ 2 million does not become available simply because the request is urgent. It would raise the project envelope to R$ 12 million and consume resources intended for other purposes. The committee would need to reassess concentration, remaining reserves and terms. Responses could include reducing the plan's scope, sharing financing with third parties, renegotiating spending or refusing the increase.
An emergency round may also carry a lower valuation, creating dilution and conflicts among founders, existing investors and new participants. An optimistic budget revision should not obscure those effects. The downside analysis must state how much cash addresses the problem, which assumption supports that amount and what happens if it fails. Where the thesis no longer holds, recognizing a loss or stopping further investment may preserve fund resources. Such a decision does not remove obligations already assumed, and it may still leave the earlier investment partly or wholly unrecoverable.
Negotiate price, rights and conflicts together
Legitimate disagreements arise when a founder considers the valuation too low while the manager believes the plan needs too much capital. The founder may prefer a smaller cheque to limit dilution; the fund may conclude that the smaller amount cannot finance a viable stage. Negotiation improves when both sides make cash requirements, deliverables, contingency and expected rights explicit. Staging an investment can help, provided conditions are objective and demonstrable. It should not leave the company dependent on milestones it has no reasonable means of proving.
Conflicts can also arise within the investment structure. A co-investor may seek liquidity earlier than the FIP, a company executive may benefit from a related supplier, or a service provider may receive compensation tied to closing. Identify these incentives before approval. Disclosure of relationships, selection criteria and remuneration helps decision-makers assess the proposal. Depending on the circumstances and applicable rules, approval procedures, abstention by conflicted participants or an independent assessment may be necessary. A disclosed conflict still requires a reasoned response.
The second round makes these tensions concrete: increasing the FIP's ownership to 23% may appeal to the fund while being unwelcome to other shareholders. The valuation, preferences and financing alternatives must be examined without assuming that the fund's preferred outcome benefits everyone equally. Minutes and supporting opinions should record disagreements and the reasons for the decision. A clear record allows investors to understand the negotiated trade-offs, the interests involved and why capital was committed. It also provides a basis for reviewing the decision if its assumptions later change.
Assign responsibilities and match evidence to each decision
An investment involves distinct tasks: sourcing opportunities, analysing the business, checking documents, approving investment, executing contracts, satisfying conditions and monitoring performance. The precise allocation depends on the vehicle and its providers, but responsibilities must be explicit. The originator should not be treated as an independent source on the quality of its own opportunity. Likewise, committee approval does not prove that all disbursement conditions have been satisfied. Each stage needs evidence appropriate to the decision being made and a clearly accountable reviewer.
Evidence should address the assumption it is intended to support. To assess recurring revenue, a manager might reconcile contracts, accounting records, invoices and receipts. To assess intellectual property, the analysis must identify ownership, assignments and restrictions. Working-capital estimates should reflect payment and collection terms actually experienced. Commercial presentations help explain the narrative, but do not resolve conflicting records. When documents disagree, the discrepancy should remain visible until investigated, rather than disappearing into an average or an unsupported statement that the issue is immaterial.
Conclusions become clearer when labelled by their support: documented fact, reconciled estimate, management assumption or unresolved item. This prevents a projection from acquiring the appearance of fact through repetition. It also guides conditions precedent and subsequent monitoring. If a central assumption lacks sufficient evidence, the appropriate response may be to postpone, reduce or condition the investment. More documents do not compensate for missing proof decisive to the thesis. The useful question is whether the evidence resolves the relevant uncertainty, rather than how large the data room has become.
Model exits using the value actually available to equity holders
Return to the base case: the FIP has invested R$ 10 million across two rounds and owns 23%. Suppose the entire company is sold at an enterprise value of R$ 90 million, with R$ 12 million of debt and R$ 2 million of cash included in the adjustment. In this simplified example, equity value would be R$ 80 million: 90 minus 12 plus 2. The fund's proportional share would be R$ 18.4 million before other applicable adjustments and costs. Enterprise value is therefore not the amount distributable to shareholders.
If costs attributable to the fund's exit were hypothetically R$ 400,000, the remaining amount in this limited calculation would be R$ 18 million, or 1.8 times the R$ 10 million invested. This is not the fund investor's net return. It excludes timing, vehicle expenses, possible taxes, compensation and other portfolio results. It also assumes proportional economic rights without additional preferences or holdbacks. Actual sale terms may include deferred payments, indemnities, price adjustments and closing conditions, each affecting the amount or timing of realized proceeds.
In a downside scenario, suppose equity value is only R$ 20 million and the 23% share remains applicable. The FIP would receive R$ 4.6 million before costs, implying a R$ 5.4 million loss against invested capital in this gross comparison. Insolvency could produce an even smaller recovery or none. Exit planning belongs in the entry decision: possible buyers, sale conditions, transfer restrictions and shareholder mechanisms all matter. A contractual exit right does not guarantee a buyer, price or liquidity, and a scenario calculation is not evidence of an actual return.
Use technology to organize information without mistaking records for validation
KEZS connects entrepreneurial projects and potential funders through technology and intermediation. For equity analysis, a project-based approach can help present the purpose of capital, proposed structure, milestones and documentation coherently. Its potential usefulness lies in organizing information and supporting better questions. Investors remain responsible for their own diligence and decisions; KEZS does not assign a credit score. A project's presentation does not establish FIP eligibility, validate its assumptions or mean that funding has been approved or completed.
Transparency does not require unrestricted disclosure. Corporate records, personal data, commercial contracts and business secrets need access proportionate to purpose, version control and careful sharing. Initial materials can be concise, with further disclosure subject to interest and confidentiality arrangements. Private documents should not be placed on public blockchains. Blockchain integrity does not establish the truth of recorded content, legal title, reserve solvency or a payment guarantee. The value of any record depends on its source, the checks performed and the rights it actually documents.
Regulatory structuring remains separate from technology. Public securities distribution and regulated financial activities require appropriate arrangements and providers; technology or a Brazilian CNAE business-activity classification is not permission to conduct them. Useful reference entry points include CVM Resolution 175, particularly Annex IV, the vehicle's own rules and ANPD guidance on personal data. These references help frame the analysis. They do not establish KEZS authorization or replace transaction-specific assessment. A technology-based presentation should be evaluated alongside costs, conflicts, uncertain outcomes and possible loss, using verified information about the arrangement concerned.
Complete the decision with limits, conditions and review triggers
A complete proposal for the example could record an initial R$ 6 million investment, a planned additional R$ 4 million subject to a new decision, initial ownership of 18.75% under the simplified structure, uses of the R$ 8 million round, negotiated rights, conditions precedent and exit scenarios. It should distinguish established facts from assumptions. The future 23% holding belongs to the specified second-round scenario; it is not a right already acquired with the first investment. Planned reserves likewise need to remain distinguishable from binding commitments.
This discipline makes common errors easier to correct. If one page uses R$ 100 million as the denominator and another uses R$ 90 million, identify the measures and recalculate comparable percentages. If a reserve has been counted as available cash, separate commitment from availability. If a material right exists only in a draft, show it as unresolved. If the business deteriorates, revise the valuation and investment thesis instead of merely moving the target milestones further away. The record should show how changed evidence affects the allocation decision.
The practical conclusion is a documented answer, with accountable people, to why this project supports this ticket within this vehicle. That answer should connect eligibility, uses of funds, concentration, governance, reserves and exit. After investment, material deviations should trigger review of budgets, conditions or continued support without implying complete protection. Good sizing is visible in the consistency of these elements and the willingness to recognize uncertainty before it becomes a difficult-to-reverse commitment. Approval starts an ongoing monitoring obligation; it does not settle the project's risks.
Frequently asked questions.
Is the smallest possible investment ticket always the most prudent choice for a FIP?
No. A small cheque may leave an essential stage underfunded, create disproportionate monitoring costs or fail to support suitable negotiated rights. Prudence depends on potential loss, concentration and the viability of the funded plan. If the required amount exceeds the vehicle's capacity, alternatives include co-investment, a narrower workable scope or declining the deal. Reducing the investment without revising the plan can simply push the funding problem into another round. The committee should assess whether the amount finances a meaningful milestone and whether the fund can bear the resulting exposure.
Does reserving money for a portfolio company oblige the fund to invest again?
A planning reserve should not, by itself, be confused with a contractual obligation. The signed documents and conditions governing each commitment must be examined. Reporting should distinguish legally committed amounts, conditional funding and discretionary capacity. Even when another investment is optional, planning should assess the consequences of declining it: dilution, the company's ability to continue and possible recovery of the earlier investment. An internal allocation does not establish a company's entitlement to cash, while a decision to stop supporting it does not cancel obligations the fund has already assumed.
Why does the R$ 4 million follow-on increase ownership to 23%?
In the hypothetical second round, the company is worth R$ 40 million before receiving R$ 10 million. The fund's existing 18.75% corresponds to R$ 7.5 million on that pre-money basis. Adding its R$ 4 million contribution produces R$ 11.5 million against the R$ 50 million post-money value, or 23%. Maintaining 18.75% would require R$ 1.875 million, the same percentage of the R$ 10 million raised. Without participating, ownership would fall to 15%. These calculations assume no other capitalization changes, preferences or conversion effects.
Can a convertible instrument postpone every discussion about ownership and governance?
No. Although conversion may happen later, its terms affect risk allocation and future dilution from the outset. Review conversion triggers, calculation methods, maturity where applicable, rights before conversion and treatment under different outcomes. FIP eligibility and consistency with the vehicle's mandate and applicable rules still require analysis. The label convertible does not make different instruments equivalent or remove documentation requirements. Before sizing the investment, the manager should understand what rights exist immediately and how conversion or failure to convert could change the position.
How should a new round be assessed when the company has missed its milestones?
First explain the deviation: weak execution, an incorrect assumption, an external shock or a combination. Then rebuild the cash requirement and test what another investment could realistically resolve. The committee should compare continued funding, a reduced plan, shared financing and stopping further investment, while accounting for existing obligations. The previous cheque does not automatically justify another. Record which evidence changed, what makes recovery plausible and what happens if the revised assumption fails. A funding gap caused by slower collections calls for a different analysis from a business with persistently uneconomic margins.
Does the example's 1.8 times multiple show what a fund investor would receive?
No. It compares R$ 18 million, after one hypothetical exit cost, with R$ 10 million invested in that project. It excludes investment duration, the vehicle's full costs and charges, possible taxes, compensation and other portfolio outcomes. It also relies on simplified assumptions about price, debt, cash and proportional rights. A fund investor's outcome depends on actual fund cash flows and distribution rules. Deferred proceeds, holdbacks or adjustments may further affect realization. The multiple is a scenario calculation, not an actual result, an annual return or a promise of profitability.
What should an investor understand from the final position proposal?
The proposal should identify the asset, eligibility rationale, recipient of the money, uses of funds, ownership and negotiated rights. It should also explain the total exposure limit, reserves, conflicts, central assumptions and routes to exit or loss. Distinguish facts from estimates, pending evidence from completed checks, and optional follow-ons from binding commitments. A project-based presentation can make this information easier to review, but does not replace diligence. If a conclusion depends on unresolved information, that dependency and its effect on disbursement must be explicit before money is released.
References and context
Institutional reference points for checking applicable rules and guidance. Calculations and scenarios are original examples, not quotes, historical results or individualized recommendations.
- Banco Central — correspondentes no País ↗
- CVM — Resolução 88, texto e alterações ↗
- CVM — Resolução 175, fundos de investimento ↗
- Portal do Empreendedor — perguntas sobre MEI ↗
- ANPD — orientações e perguntas frequentes ↗
AI-assisted educational content. Decisions require verification of the information, instruments and providers in each actual case.
