What are co-investment opportunities?

A co-investment opportunity is an invitation to invest alongside a fund manager’s private fund (the “Main Fund”) in a specific underlying portfolio company. Co-investments are typically offered on a discretionary basis, allowing the selected co-investors to opt in or out of the opportunity.

What is a co-investment vehicle?

For definitional purposes, a co- investment structure may be thought of as a vehicle that participates in an investment on a co-mingled basis or on behalf of a single investor alongside, or in lieu of, an investment manager’s main fund, which may be limited in the extent to which it can deploy capital in the pertinent …

What is a co-investment agreement?

Co-Investment Agreement means an agreement between the Partnership and any independent third-party or Affiliate of the General Partner under which they will create a new entity, such as a partnership or a limited liability company, in which each of them will acquire equity interests and, thus, indirectly participate in …

Why do LP investors typically seek co-investment rights with a GP?

Apart from lower or no fees, a co-investment lets an LP see and negotiate the terms, get access to better and more varied deal flow, more easily track a company’s performance, and see returns that are around 5% higher than for a traditional PE fund.

What is direct co-investment?

It is a way to execute a direct investment. Co-investing — a subset of direct investing, when an investor invests alongside a lead Sponsor to purchase ownership directly in an operating company. On every deal, a leading party sources, structures, and executes the transaction.

Are real assets?

Real assets are physical assets that have an intrinsic worth due to their substance and properties. Real assets include precious metals, commodities, real estate, land, equipment, and natural resources.

What is co-investment capital?

An equity co-investment (or co-investment) is a minority investment, made directly into an operating company, alongside a financial sponsor or other private equity investor, in a leveraged buyout, recapitalization or growth capital transaction. In certain circumstances, venture capital firms may also seek co-investors.

Is a co-investment vehicle an AIF?

“Co-Investment Vehicles” under the AIFM Law: Is your Vehicle an AIF? In recent years, more and more “co-investment vehicles”, of all shapes and sizes, have been used in the Luxembourg alternative investment fund (“AIF”) domain.

What is DPI in private equity?

Distribution to Paid-In (DPI): measure of the cumulative investment returned to the investor relative to invested capital. Residual Value to Paid-In (RVPI): measure of how much of the investors’ capital is still tied up in the equity of the fund.

What is a direct co investment?

Should I invest in an LP?

The key advantage to an LP, at least for limited partners, is that their personal liability is limited. They are only responsible for the amount invested in the LP. These entities can be used by GPs when looking to raise capital for investment. Many hedge funds and real estate investment partnerships are set up as LPs.

What is a sponsor LP?

A sponsor is the person or team that champions all aspects of a commercial real estate project on behalf of the equity investors. The sponsor is often referred to as the General Partner (GP), whereas the rest of the investors are Limited Partners (LPs).