LPs

LPs, or limited partners, are investors in a private investment fund, such as a venture capital or private equity fund. They provide capital but are not involved in managing the day-to-day operations of the fund. The general partner (GP) manages the investments and makes decisions, while LPs earn returns based on the fund's performance. LPs typically include institutions, wealthy individuals, or entities seeking exposure to alternative investments. Their liability is limited to the amount of their investment, reducing personal risk, and they receive a share of profits according to the fund’s agreement.