Glossary - General Partner (GP)
A General Partner (GP) is an individual or entity responsible for managing a partnership, making investment decisions, and overseeing the operations of a fund or a partnership. GPs are actively involved in the management and have unlimited personal liability for the debts and obligations of the partnership.
Also known as
- Managing Partner
- Sponsor
Use cases examples
- Limited Partnership Agreement: The General Partner shall have full authority to manage and control the business and affairs of the Partnership, subject to the restrictions and obligations set forth in this Agreement.
- Venture Capital Fund Offering Memorandum: As the General Partner, XYZ Capital LLC will source, evaluate, and execute investment opportunities on behalf of the Fund, adhering to the Fund's investment criteria and strategy.
Considerations for investors
- Investors should evaluate the experience, track record, and alignment of interests of the GP to ensure they are capable of managing the fund effectively.
- Investors need to be aware of the fee structure, including management fees and carried interest, charged by the GP as these can affect the overall returns on their investment.
Considerations for founders
- Founders should understand the role and powers of the GP in any investment vehicle, as their decisions will directly impact the operation and success of the business.
- It's important to review the track record and reputation of the GP, as their expertise and network can significantly contribute to the growth and scaling of the business.
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