How LPs Evaluate GP Co-Investment Rights

In this episode of The Venture Capital Investor Podcast, Lucas and Luna dive into co-investment rights — the clause that lets limited partners invest directly in a portfolio company alongside the fund. Using the 2021 fintech boom as a case study, they explore how LPs negotiate these rights, why GPs grant them, and the risks of adverse selection. They discuss the difference between pro-rata and discretionary co-investment, the role of side letters, and how co-investment can lower fees while concentrating risk. With a nod to CalPERS and other institutional investors, they unpack the tension between LP demand and GP control, and why a well-structured co-investment program can be a win-win. Tune in for a practical guide to one of the most valuable — and misunderstood — clauses in a VC fund agreement. #CoInvestment #LPs #VentureCapital #FundTerms #SideLetters #GP #LimitedPartners #InstitutionalInvestors #CalPERS #FeeReduction #AdverseSelection #Finance #Investing #PrivateEquity #FexingoBusiness #BusinessPodcast #StartupFunding #DueDiligence Keep every episode free: buymeacoffee.com/fexingo