Since IPOs slowed to trickle a few years ago, limited partners who invest in venture capital funds have had one giant problem: a dearth of liquidity.Lack of cash returns has been especially troublesome for wealthy individuals or their small family offices who manage the assets of the wealthy that made substantial investments in VC funds.Having funds locked up in venture capital was a big issue for entrepreneur Mike Hurst. After selling Exactuals (a payments startup he founded) to City National Bank in 2018, he invested a good portion of the proceeds from the exit into tech stocks and venture funds.Then the tech stocks crashed in 2022 and Hurst told TechCrunch that he didnt have enough free cash to support his VC fund commitments.Firms kept coming for capital calls and new investments. I wanted to make them, but I didnt want to mortgage the house, take a margin line or sell Amazon at $90 when I knew it was going back to $210, he said.That experience gave Hurst the idea to create a credit product that would allow limited partners to borrow funds secured by their LP position in venture funds.Hurst turned his vision into Turbine, a debtplatform for limited partners in private equity and VC. The company is coming out of stealth on Friday and announcing that it has raised a total of $22 million in equity funding co-led by Alpha Edison and TTV Capital with the participation of Fin Capital, B Capital, and Sozo Ventures.The company has also secured up to $100 million in debt from Silicon Valley Bank to support its loan making.Turbine provides a way for limited partners to access funds using their fund stakes as collateral, much like a home equity line of credit uses home value or a margin line uses stock holdings.Gardiner Garrard,I had many incidents where an LP approached me, asking about liquidity, Garrard said. But there werent many great options for helping a single investor in a fund get some cash.Garrard explained that TTV could have sold some stock in a portfolio company on the secondaries market to help the investor, but he didnt want to sell an asset early to serve the needs of only one LP.Alternatively, the LP could have tried to sell their stake (known as LP interest) in the fund, but those deals come with significant discounts, Garrard said, meaning the LP would likely have to sell the stake for less than it was worth.Turbine claims its offering investors liquidity on the appreciated value of their position in the venture funds without giving up on the future upside. For example, if an LPs initial $3 million investment in a fund has grown to $10 million, they can use that $10 million valuation as collateral for their loan.The downside is that these loans arent cheap. The interest rate is currently around 9% (the prime rate is currently around 7.5%, so many loans these days of any kind arent cheap).But Gerrard argues that this could still be considered a very reasonable rate and a lot cheaper than the cost of selling the stake on secondary markets, at a loss, or even just at a discount.Turbines first customers are the five venture firms that backed its equity raise. The general partners of these firms are already offering their LPs access to Turbines credit, Hurst said, adding that it plans to make its product available to more VC funds following todays announcement.I couldnt believe we didnt have something like this for our LPs before, Garrard said.