Limited partner (LP)
An investor who commits capital to a fund managed by a general partner, with liability limited to the amount committed.
What it is
A limited partner is an investor in a fund. LPs commit capital; the general partner (GP) manages the fund and makes the investment decisions. An LP’s liability is limited to what they committed.
LPs include pension funds, endowments, foundations, family offices, funds of funds, and high-net-worth individuals.
LP vs GP
- General partner. Runs the fund, sources and selects investments, and carries management responsibility.
- Limited partner. Provides capital, receives reports and distributions, and has no role in day-to-day decisions.
What LP tracking covers
For a fund team, LP tracking is a separate job from dealflow. It usually includes:
- Commitments. How much each LP committed, to which fund, and in which currency.
- Fundraising pipeline. Prospective LPs, their stage, and the last conversation.
- Relationships. Who at the firm knows whom, and who introduced each LP.
- Entities. Many LPs invest through more than one vehicle, so the person and the investing entity need separate records.
- Reporting. Which LPs receive which updates, and when they last heard from the fund.
Why it matters
Fundraising runs on relationships that span years and multiple funds. When LP data is split across spreadsheets and inboxes, the firm loses track of commitments, repeats outreach, and has no clean view of who to call for the next fund.
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