Due Diligence in Private Markets

Fund Manager Evaluation

As a limited partner (LP), the single most impactful decision you will make when placing your hard-earned dollars is choosing the sponsor (or fund manager). You’re not just evaluating an individual or team; you’re vetting the steward of your capital. A sponsor’s strategy, execution, and incentives directly affect your returns (or lack thereof). Choose wisely.

Today we’ll break down the key elements to consider when evaluating a fund manager, keeping in mind that this process is as much art as science. I can’t stress this strongly enough: DO NOT rely on others to perform due diligence, always do your own. Seeing a brand-name institutional LP investing alongside is not an excuse to bypass this step: your money is on the line.

Remember, this isn’t investment advice, nor legal counsel. It’s a framework to help guide your due diligence. As always, context is key—the universe is nuanced, and no two funds are the same.

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