Real‑world examples of private equity investment structures (and how they actually work)

Core examples of private equity investment structures you actually see in deals

Most investors first encounter private equity through a traditional buyout fund. That’s the starting point for understanding other examples of private equity investment structures, because almost everything else is a variation on the same core ideas: pooled capital, long lockups, and a clear hierarchy of who gets paid when.

In practice, examples include:

• Classic closed‑end limited partnership (LP/GP) buyout funds
• Growth equity and venture funds using similar LP/GP setups
• Co‑investment vehicles sitting alongside flagship funds
• Separate accounts and SMAs for big institutional investors
• Fund‑of‑funds that hold multiple PE funds
• Secondary and continuation funds buying older portfolios
• Evergreen or semi‑liquid private equity structures

Each of these is an example of how private equity managers balance control, fees, liquidity, and alignment with investors.

The classic LP/GP fund: the reference example of private equity structure

If you understand one model, make it this one. The limited partnership structure is the reference point for most examples of examples of private equity investment structures.

How it’s set up
A private equity sponsor forms a limited partnership (the fund). The sponsor acts through a general partner (GP) entity and a management company. Outside investors—pension funds, endowments, insurance companies, family offices, and qualified individuals—come in as limited partners (LPs).

Key features you’ll see in almost every example of this structure:

• Term: Typically 10–12 years, with possible extensions
• Investment period: First 4–6 years to deploy capital
• Management fee: Often ~2% of committed capital during the investment period, then stepping down
• Carried interest: Usually 20% of profits above a preferred return (commonly 8%)
• Waterfall: Capital returned to LPs first, then preferred return, then catch‑up and carry split between LPs and GP

Real‑world example (hypothetical but realistic)
Think of a mid‑market North American buyout fund, “Atlas Capital Partners Fund IV,” with $3 billion in commitments from public pensions, sovereign wealth funds, and a few large family offices. Atlas invests in 12–15 portfolio companies, holds them for 4–7 years, then exits via sales to strategics, IPOs, or secondary buyouts. LPs get capital distributions as exits happen, not at the very end.

This kind of LP/GP fund is one of the best examples of private equity investment structures because it shows how fees, carried interest, and governance are typically organized.

For a deeper look at limited partnerships and fund governance, the U.S. Securities and Exchange Commission (SEC) offers plain‑English guidance on private funds and conflicts of interest in its private fund adviser materials: https://www.sec.gov/divisions/investment/private-funds-statute-and-rules

Growth equity and venture funds: same skeleton, different risk profile

Another important example of private equity investment structure uses the same LP/GP framework, but targets earlier‑stage or higher‑growth companies.

What stays the same

• LP/GP legal structure
• 10‑year (or longer) fund life
• Management fee plus carried interest
• Capital calls over several years

What changes

• Stage of companies: From early‑stage startups (venture) to profitable but still scaling businesses (growth equity)
• Check size: Smaller, more numerous positions in venture; fewer, larger tickets in growth equity
• Exit paths: Heavy reliance on IPO markets and strategic M&A

Real example pattern
A growth equity fund might raise \(1.5 billion, target minority stakes in software‑as‑a‑service (SaaS) companies with \)20–$100 million in revenue, and structure deals with preferred shares that include downside protection (liquidation preferences, anti‑dilution). The fund structure itself—capital calls, LP commitments, carry—is almost identical to a buyout fund.

If you’re comparing examples of examples of private equity investment structures, the key takeaway is that venture and growth equity mostly tweak portfolio strategy, not the legal or economic core of the fund.

Co‑investments: side‑by‑side examples of private equity investment structures

Co‑investments are one of the clearest examples of how private equity structures can be layered.

How co‑investments work
The main fund (the flagship LP/GP vehicle) identifies a deal that’s larger than the capital it wants to allocate from the fund. The GP then offers selected LPs the chance to invest directly into that single deal through a separate co‑investment vehicle.

Why investors care

• Often reduced or no management fee on the co‑investment
• Often no carry or a lower carry than the main fund
• Direct exposure to a specific company instead of the full portfolio

Example in practice
Imagine Atlas Capital Partners is buying a \(1.2 billion industrial technology company. The flagship fund will commit \)600 million. Atlas then creates “Atlas Co‑Investment Vehicle I, L.P.” for LPs to put in another \(400 million, and brings in a strategic partner for the remaining \)200 million.

The co‑investment vehicle is usually a separate limited partnership or special purpose vehicle (SPV), but it sits alongside the main fund in the target’s cap table. This is a clear example of examples of private equity investment structures being stacked: a core fund plus a deal‑specific sidecar.

Institutional investors like public pensions and endowments have expanded co‑investment programs in the last decade to lower average fees. The Institutional Limited Partners Association (ILPA) has published guidance on co‑investments and alignment of interest: https://ilpa.org

Separate accounts and SMAs: customized examples include fee and strategy tweaks

Large institutions—think $50+ billion pension funds or sovereign wealth funds—often negotiate separately managed accounts (SMAs) or strategic partnerships with big private equity firms.

What makes SMAs different

• The investor is typically the only LP (or one of a very small number)
• Strategy is tailored: specific sectors, geographies, or deal sizes
• Fee terms are often better than flagship funds (lower management fee, sometimes tiered carry)
• Governance can include enhanced reporting, veto rights, or co‑investment priorities

Example structure
A U.S. public pension might commit $2 billion to a 12‑year SMA with a global buyout manager. The account is structured as a limited partnership, but the pension is the sole LP. The GP agrees to:

• Invest at least 50% of capital in North American mid‑market buyouts
• Offer the pension first‑look rights on co‑investments
• Charge a 1% management fee and 10–15% carry instead of the standard 2%/20%

This is a good example of private equity investment structures evolving as large LPs gain bargaining power and seek more control over how their capital is deployed.

Fund‑of‑funds: examples of structures built on top of other funds

If you don’t have the scale or staff to underwrite dozens of individual funds and hundreds of deals, a fund‑of‑funds (FoF) is another example of private equity investment structure that can make sense.

How a FoF is built

• The FoF itself is a limited partnership with its own LPs and GP
• Instead of buying companies directly, it commits capital to multiple underlying private equity funds
• Sometimes it also does secondaries or co‑investments

Why investors use it

• Instant diversification across managers, vintages, geographies, and strategies
• Access to top‑tier funds that may be closed to new direct LPs
• Outsourced due diligence and portfolio monitoring

Example in the market
A global FoF might raise $2.5 billion and build a portfolio of 25–30 underlying buyout, growth, and venture funds across the U.S., Europe, and Asia. For a smaller family office, that FoF becomes a single commitment that spreads exposure across hundreds of portfolio companies.

The trade‑off: an extra layer of fees—FoF management fees plus underlying fund fees.

The U.S. Department of Labor has educational material on alternative investments in retirement plans, including multi‑layered structures like FoFs, on its site: https://www.dol.gov/agencies/ebsa

Secondaries and continuation funds: newer examples of structures for older assets

Secondary markets have exploded since the 2010s and continued to grow into 2024–2025. These markets create some of the most interesting examples of private equity investment structures.

Classic secondary funds

A secondary fund raises capital to buy existing LP interests in private equity funds, or to buy portfolios of companies from older funds.

Structure

• Again, a closed‑end LP/GP fund
• Often 10–12‑year terms, but capital is deployed faster because assets are already partially matured
• Returns often driven by buying at a discount and managing exits efficiently

Example
A secondary fund might buy a basket of LP interests in 2017–2019 vintage buyout funds from a European insurance company that wants to reduce its private equity exposure. The secondary fund steps into the insurance company’s shoes as LP, taking over future capital calls and distributions.

GP‑led continuation vehicles

One of the most talked‑about examples of examples of private equity investment structures in recent years is the GP‑led continuation fund.

What’s happening here
A GP has a star asset in an older fund that still has room to grow, but the fund is nearing the end of its life. Instead of selling the company outright, the GP creates a new continuation vehicle that buys the asset (or a small portfolio of assets) from the old fund.

Key mechanics

• Existing LPs can roll their exposure into the new vehicle or cash out
• New secondary investors provide fresh capital to buy out exiting LPs and fund future growth
• Economics (fees, carry) are reset for the new vehicle

Example scenario
Atlas Capital Partners Fund II owns a healthcare services company that has tripled in value but still has material runway. Fund II is in year 11. Atlas launches “Atlas Continuation Fund I,” raises $1.1 billion from secondary investors, and buys the healthcare asset from Fund II.

This continuation fund is another limited partnership, but focused on a small number of already‑owned companies. It’s a vivid example of private equity investment structures adapting to longer holding periods and the need for liquidity options.

For academic research on private markets and secondaries, the Harvard Business School working papers collection is a good starting point: https://www.hbs.edu/faculty/research/Pages/default.aspx

Evergreen and semi‑liquid funds: modern examples include retail‑friendly structures

In 2024–2025, you’re seeing more evergreen and semi‑liquid private equity vehicles designed for wealth management platforms and high‑net‑worth investors.

How they differ from classic funds

• No fixed end date: Capital is raised on a rolling basis
• Periodic subscriptions and redemptions: Monthly or quarterly windows, subject to gates and limits
• NAV‑based pricing: Investors buy and sell based on net asset value, not just distributions
• Blended portfolios: Mix of primary fund commitments, secondaries, and co‑investments

Example of structure
A private equity firm launches an evergreen “Private Markets Access Fund” available to accredited investors via wirehouse platforms. The fund is structured as an interval fund or tender‑offer fund under the Investment Company Act, offers quarterly liquidity (up to a cap), and charges a management fee plus performance‑based incentive fee.

This is an example of private equity investment structures being adapted for a broader investor base that needs:

• Lower minimums (e.g., \(25,000–\)100,000 instead of multi‑million‑dollar commitments)
• 1099 tax reporting instead of K‑1s in some cases
• More predictable capital calls (or no calls at all—investors fund upfront)

The U.S. SEC provides investor education on interval and tender‑offer funds, which helps in understanding these semi‑liquid structures: https://www.sec.gov/investor

Comparing the best examples of private equity investment structures

If you line up the best examples of private equity investment structures side by side, a few patterns jump out:

1. Who controls the capital and decisions

• Flagship LP/GP funds: GP has wide discretion within the mandate; LPs are passive
• SMAs and strategic accounts: LP has more influence on strategy and terms
• Co‑investments: LPs choose which deals to join, but GP still controls execution

2. How fees and carry show up

• Traditional funds and FoFs: full management fee + carry
• Co‑investments: often lower or no management fee, sometimes reduced carry
• Secondaries: fees similar to buyout funds, but economics driven by entry discounts
• Evergreen funds: mix of management fee and incentive fee tied to NAV and realized gains

3. Liquidity and time horizon

• Classic funds and SMAs: illiquid, 10–12‑year commitments
• Secondaries and continuation funds: shorter duration exposure to more mature assets
• Evergreen and interval structures: limited periodic liquidity, but still long‑term

When you’re evaluating real examples of private equity investment structures, the smart questions to ask are:

• Where do I sit in the waterfall?
• How and when is capital called and returned?
• What’s the alignment of interest between LPs and GP in this structure?

Those questions matter more than whether the label says buyout, growth, secondary, or evergreen.

FAQs: examples of private equity investment structures investors ask about

What are the most common examples of private equity investment structures for institutional investors?

For large institutions, the most common examples include classic closed‑end LP/GP buyout and growth equity funds, co‑investment vehicles, and separate accounts or SMAs. Many also use fund‑of‑funds for niche or international exposure. In the last several years, GP‑led continuation funds and secondary funds have become standard parts of institutional private equity portfolios.

Can you give an example of a private equity co‑investment structure for an individual investor?

A typical example of private equity co‑investment for a high‑net‑worth investor would be a special purpose vehicle (SPV) organized by a private bank or wealth manager. The SPV pools capital from multiple qualified clients to participate alongside a flagship fund in a single buyout deal. Investors commit a fixed amount upfront, pay little or no management fee at the SPV level, and receive distributions directly from deal exits.

How do evergreen private equity funds differ from traditional examples of fund structures?

Evergreen funds accept capital on a rolling basis, offer periodic (usually quarterly) redemption windows, and calculate investor positions using NAV. Traditional funds raise a fixed pool of capital in a defined fundraising period, call it down over several years, and then distribute proceeds as assets are sold. Evergreen structures are designed to smooth capital deployment and provide limited liquidity, but they still require investors to think in multi‑year timeframes.

Are fund‑of‑funds still a good example of private equity investment structure in 2024–2025?

They’re still widely used, especially by smaller institutions and family offices that want diversification and professional manager selection. The trade‑off is the additional fee layer. Many investors now combine a core allocation to a fund‑of‑funds with selective direct fund commitments or co‑investments to manage overall fees while still accessing high‑quality managers.

What examples of risk should I watch for in more complex private equity structures like continuation funds?

With continuation funds and other GP‑led secondaries, you should pay close attention to conflicts of interest. The GP is effectively selling assets from one vehicle it controls to another vehicle it also controls. Key questions: How was the price set? Was there an independent fairness opinion? What options did existing LPs have? Understanding these governance points can matter as much as the headline return projections when you evaluate these examples of private equity investment structures.

The bottom line: once you understand the core LP/GP model, most examples of private equity investment structures are variations on how capital, control, and liquidity are balanced. Use that lens, and the alphabet soup of funds, SPVs, SMAs, FoFs, and continuation vehicles starts to look a lot more organized—and a lot easier to underwrite.