Here’s what you need to know about a company general partner. You may even decide to become one yourself.
A GP is responsible for managing a venture fund. They analyze potential deals and decide what to do with their money, just like other fund managers in different sectors like mutual funds, stocks, bonds, or real estate. A general partner may also hold a partnership at a large venture capital firm or invest independently on AngelList.
Like this general partner, they also invest capital into the company and have a stake.
There are two primary responsibilities for a general partner raising money from limited partners (aka LPs) and finding quality investments.
The work of an LP is mainly done when they invest money into a venture fund. You may occasionally advise the GP and give your opinion on deals, but you are generally a passive investor. It’s just a case of sitting back and waiting for returns one day.
GPs, however, face the opposite situation. During the fund’s lifetime (typically more than ten years), GPs are ultimately responsible for everything that happens.
A general partner’s primary responsibilities are as follows:
Generally, the job of a company general partner is not taken lightly. They operate under a lot of pressure and work on high-risk activities, which entails risks for them and LPs.
However, as successful venture funds can be highly lucrative in the longer term, the rewards will exceed those risks. Becoming a company general partner may be the perfect role if you’re entrepreneurial and passionate about startups.
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