LP Co-Investment: Structures at a Glance
Deal-by-deal access alongside the main blind-pool fund — economics vary.
| Structure | Typical economics | Watch-out |
|---|---|---|
Fund + co-invest SPV | Often 0/0 or reduced fees on co-invest slice | Allocation politics; close timing risk |
Side-letter priority rights | Right of first offer on co-invest | Not available to all LPs equally |
Deal-by-deal only (no fund) | Underwrite company + lead GP | No blind-pool diversification |
Founder view | Extra capital capacity | Too many parties can slow docs |
Co-invest is a relationship and portfolio tool — not automatic alpha. Adverse selection risk is real if only “extra” capacity deals are offered.