Fund structures

A limited partnership (LP) is a statutory partnership with at least one general partner, which manages it and is liable without limit for its debts, and at least one limited partner, whose liability is capped at its contribution.

A general partner (GP) is the partner of a limited partnership that manages and controls it and bears unlimited liability for its obligations; in private funds it is usually a sponsor-controlled special-purpose entity that receives the carried interest.

A limited partner (LP) is a member of a limited partnership whose liability is limited to its agreed contribution and who does not manage the partnership; in private markets the term is used for any investor in a private fund.

A management company is the sponsor's operating entity that employs the investment team, manages or advises the sponsor's funds under contract and receives the management fee; it is usually the registered investment adviser or authorised fund manager.

An emerging manager is an investment firm that an allocator's programme classifies as early in its institutional life, usually by fund number, firm assets or fund size; definitions and thresholds differ by allocator and asset class.

A closed-end fund is a fund whose investors cannot redeem their interests on demand; in US law it is a management investment company that is not open-end, and in private markets usually a fixed-term drawdown fund.

An open-end fund is a fund that issues interests investors can require it to redeem at or near net asset value, so its capital rises and falls with subscriptions and redemptions rather than being fixed at a closing.

An evergreen fund is a fund with no fixed end date that raises capital continuously or periodically and reinvests realisation proceeds, giving investors liquidity, if any, through redemptions, repurchase offers or a listing rather than a scheduled wind-down.

A semi-liquid fund is an evergreen vehicle holding mainly illiquid private assets that offers limited periodic liquidity, typically quarterly repurchases capped at a small percentage of shares or NAV, which can be prorated and, under some wrappers, suspended.

An interval fund is a US registered closed-end fund that, under Investment Company Act Rule 23c-3, must offer to repurchase 5% to 25% of its outstanding shares at net asset value every three, six or twelve months.

A business development company (BDC) is a US closed-end investment company that elects to be regulated under special provisions of the Investment Company Act and invests mainly in securities of private or small US companies, most commonly through private credit.

A master-feeder structure is a fund arrangement in which two or more feeder funds, each designed for a different investor group, invest substantially all their assets in a single master fund that holds and trades the portfolio.

A blocker corporation is an entity taxed as a corporation and placed between tax-exempt or non-US investors and a pass-through investment so that unrelated business taxable income or effectively connected income is taxed at corporate level instead of reaching them.

A separately managed account (SMA) is an arrangement in which a manager invests assets for one client under an investment management agreement, with assets held in the client's name or a vehicle it controls rather than in a pooled fund.

A special purpose vehicle (SPV) is a legal entity formed for one narrowly defined purpose, such as holding one investment, acquiring one company or issuing one financing, so that its assets and liabilities stay separate from its sponsors' and investors'.

A co-investment is a minority equity investment made directly in a specific portfolio company alongside a private fund sponsor's main fund, typically offered to the fund's LPs or other partners on reduced or no management fee and carried interest.

A fund of funds (FoF) is a fund that invests in other funds rather than directly in companies or assets, giving its investors diversified exposure across managers, strategies or vintages in exchange for an additional layer of fees.

A subscription line of credit is a revolving loan to a private fund secured on its investors' uncalled capital commitments and the fund's right to call them, used to fund investments and expenses before, or instead of, calling capital.

NAV lending is lending to a private fund, or to a vehicle that holds its investments, secured on the net asset value of the fund's existing portfolio rather than on investors' uncalled commitments.

A 3(c)(1) fund is a private fund excluded from investment-company status by Investment Company Act section 3(c)(1) because it has no more than 100 beneficial owners (250 for a qualifying venture capital fund) and makes no public offering.

A 3(c)(7) fund is a private fund excluded from investment-company status by Investment Company Act section 3(c)(7) because its securities are owned exclusively by qualified purchasers and it makes no public offering.

A European long-term investment fund (ELTIF) is an EU alternative investment fund authorised under Regulation (EU) 2015/760, as amended, that invests mainly in long-term assets, such as unlisted companies, real assets and loans, and may be marketed to retail investors.