LP (Limited Partner) refers to a limited partner, which is an investor who provides funds to VC or PE institutions, usually large institutional investors such as pension funds, insurance companies, university funds, etc. LPs generally do not participate in specific investment decisions, but enjoy the returns of the fund and bear corresponding risks.
In private equity funds, the abbreviation for fund investors can also be LP. The relationship between LP and Fund Company (GP) is a principal-agent relationship, where GP represents LP in managing and operating funds. Fund companies need to register their funds in order to legally raise funds from the public.
