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There's more to co-invest than fee discounts

There's more to co-invest than fee discounts

What other benefits can you get from looking at co-invest?

Matthew Podlesak
June 21, 2024

Diligencing a live co-investment alongside a GP reveals valuable insights into the GP’s abilities…

…and makes for better decisions for fund investments

TLDR: having the chance to look at live co-investment opportunities as an LP can reveal valuable insight into how the GP operates…

…and can help inform better decisions when considering investing into the GP’s blind-pool fund.

Yesterday I shared our analysis quantifying the impact of fee free co-invest for a mega-LP like CalPERS.... but there's more to co-invest than just getting a break on fees.

LPs can learn valuable information about how a GP thinks, the GP's investment process, their judgement, their discipline, their work product etc. by taking a look at co-investments.

You can learn not only from the deals that make it over the finish line...

…but also from the deals the GP decided not to do.

The deals where the GP had the discipline to walk away in response to some new information... even in the 11th hour after putting in a lot of work.

These insights are not the same as hearing deal case studies long after a deal is done during the standard fundraising process.

There's always some story telling when you look back at history, why an investment was made, and why the investment played out the way it did.

Being part of the action is different.

Unlocking this information can be especially valuable for LPs who are considering an investment into an emerging manager's Fund I, II, III...

At the end of the day, you're investing in people when you back a GP. And the GP is investing in people too when they back a company.

So, use co-investments to learn the subtle (or not so subtle) insights about a GP to take your fund investment decisions to the next level.

Even better if you can do so before having to invest into their blind pool.

At Gather Capital, we strive to curate a set of world class alternative investment opportunities, especially within private equity, that enable our clients to invest alongside many of these elite family office limited partners.

We are investing into a wide range of opportunities from:

multi-billion dollar sized funds from blue-chip firms with multi-decade track records of top tier returns…
…to sub-billion dollar sized funds led by highly sought after emerging managers.

If you’re interested in learning more about what we do, feel free to: