LP
A limited partner is an investor holding a limited-partner interest, with liability and governance rights determined by applicable law and agreements. Pension funds, endowments and families are examples of fund investors.
Also called Limited partner
LP in practice
Hypothetical: investors commit capital to a fund and make contributions when capital is called. Calls can fund investments, fees or expenses, and commitments need not be called all at once. Investment realizations return to the fund; distributions then flow to investors under the agreed waterfall.
Scroll horizontally to read all columns.
| Direction | What moves |
|---|---|
| LP → fund | Contributions following capital calls |
| Fund → investments | Investment funding |
| Investments → fund | Realizations and other investment proceeds |
| Fund → LP | Distributions under the agreed waterfall |
Shayne Fitz-Coy’s definition of LP
It’s pension funds, insurance, sovereign wealth. They’re providing 99%, 98% of the capital.
Terms Related to LP
GP · Carry · Hurdle rate · DPI · ILPA · Sovereign wealth fund · Captive vs independent fund · All of the glossary