Co-Investment

A co-investment is a direct investment made alongside a fund manager (general partner) into a specific portfolio company, typically on more favourable economics than the fund's standard fee structure. Co-investments allow family offices to concentrate capital into highest-conviction opportunities while preserving the diligence and operational support of the GP.

Co-investment rights are negotiated as part of a fund commitment and vary widely. Anchor LPs, large-cheque LPs, and strategic LPs typically receive priority co-investment offers. The economics are usually fee-light: reduced or zero management fee, reduced or zero carried interest, in exchange for committed capital and timely decision-making.

Co-investment is increasingly the practical middle path between full direct investing (which demands operational capability most offices lack) and pure fund allocation (which dilutes returns through layered fees).