All terms
Limited Partner / General Partner
The two principal roles in a venture capital fund: LPs provide capital, GPs manage the fund and make investment decisions.
Reviewed by Christian Espinosa, Founder, Blue Goat CyberLast reviewed May 9, 2026
Definition
Venture capital funds are typically organized as Delaware limited partnerships in which Limited Partners (LPs) — pension funds, endowments, family offices, sovereign wealth funds, fund-of-funds, high-net-worth individuals — provide the capital, and General Partners (GPs), the venture firm's investment professionals, manage the fund. LPs have limited liability and limited management role; GPs have unlimited liability for fund obligations and earn management fees (typically 2% of committed capital annually) plus carried interest (typically 20% of profits above a hurdle).What this means in practice
MedTech founders should understand LP composition because it shapes a fund's risk tolerance, hold period (typical 10-year fund life), and willingness to support follow-on rounds. Funds late in their investment period have less capacity for new investments and reserves. Common pitfalls
- •Pitching a fund without checking where it sits in its investment period.
- •Underestimating how LP composition (pension vs. family office) affects a GP's behavior in tough rounds.
Primary references
3 sourcesLink health: 3 verified· last checked 2026-05-09
NVCA·2ILPA·1
- 1
NVCA — Venture Capital 101VerifiedNVCAnvca.org
- 2
ILPA Principles 3.0VerifiedILPAilpa.org
- 3
NVCA Model DocumentsVerifiedNVCAnvca.org
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