LPs (Limited Partners)

Limited Partners (LPs) are investors who provide capital to a partnership, such as a private equity or venture capital fund, but don't manage or make day-to-day decisions. Their role is to supply funds and share in the profits or losses according to their investment, while the fund’s general partners (GPs) handle the investment management. LPs benefit from the potential returns of the investments without being involved in the active management, and their liability is typically limited to the amount they invested, offering a layer of protection. They are common in alternative investment structures seeking to diversify and generate high returns.