What is the relationship between GP, LP and fund managers in private equity funds?

Directory

Fund stakeholders-GP and LP, fund managers

The first step of the Long March-Fund preparation

LP is a limited partner

We can simply understand it as the investor. Many times, a project needs to invest tens of millions or even hundreds of millions of funds. (Most investment companies have many different projects.) And the GPs of investment companies don't have so much money or they don't want to invest so much company funds in one project in order to share risks.

GP is a general partner

most of the time, gp and LP exist at the same time. And they mainly exist in some companies that need a large amount of capital investment, such as Private Equity (PE), Hedge Fund (Hedge Fund) and Venture Capital.

Partners refer to organizations and individuals who invest to form a partnership and participate in the partnership operation, and are the main body of the partnership enterprise.