What is Limited Partner (LP)?
A limited partner (LP) is an investor who commits capital to a fund — such as a venture or private equity fund — but does not manage it. LPs include pension funds, endowments, family offices, foundations, and sovereign wealth funds.
A limited partner (LP) is an investor in a private investment fund who provides capital but takes no part in the fund’s day-to-day management. Their liability is "limited" to the amount they commit, and that passivity is what preserves the limited-liability protection of the partnership structure.
LPs are the capital base behind venture capital, private equity, private credit, real estate, and hedge funds. Typical LPs include public and private pension funds, university and nonprofit endowments, insurance companies, sovereign wealth funds, fund-of-funds, and single- and multi-family offices. Fund managers (general partners) raise capital by securing commitments from these LPs.
Also known as: LP, limited partners