What is a limited partner?

An LP’s rights and obligations sit in the limited partnership agreement and any side letter, not in the label. Limited liability usually depends on the LP staying out of management, which is why oversight is channeled through the advisory committee (LPAC) and consent votes. LPs fund capital calls over time, and a fund is often a limited partnership but can be another vehicle.

Say a pension plan commits $100 million to a fund. It is an LP: it provides money but does not choose investments, and its loss is generally limited to its commitment.

LPs, from pensions to family offices, are the buyers of everything private markets sell, so their appetite drives the market.