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Limited Partner

Definition

A Limited Partner (LP) is an investor in a private equity or growth equity fund. LPs provide the capital that GPs deploy into acquisitions or investments. LPs are typically institutional investors — pension funds, endowments, foundations, family offices, and funds of funds. They have limited liability and limited involvement in day-to-day fund operations, hence the name.

Context

In Ep. 20, Jake Colognesi provides unusual insight into how LPs diligence sourcing capabilities during fundraising. He reports that sourcing was "probably the most important topic" in LP conversations, ranking alongside returns and deal history. LPs ask pointed questions about conversion metrics, how specific deals were sourced, and even call portfolio company CEOs to verify. Jake notes that every GP claims a proprietary tech-enabled sourcing advantage — LPs are skeptical of this. See LP Diligence on Sourcing for full coverage.