General Partner
A General Partner (GP) is the VC firm itself (or its managing entity, typically structured as an LLC) that runs a venture fund. The GP makes investment decisions, manages portfolio companies, and earns management fees plus carried interest on fund profits. This stands in contrast to Limited Partners (LPs) who provide capital but don't manage, with GPs bearing full operational responsibility for fund performance and unlimited legal liability for fund obligations. The GP is the "VC" that founders interact with day-to-day; the GP is also the entity LPs hold accountable for fund returns.
The GP organizational structure: a VC firm is typically organized as a management company (the LLC that employs the partners and operates the firm) plus a GP entity for each fund (a separate LLC that serves as the general partner of that fund's limited partnership). When a new fund is raised, a new GP entity is formed for that fund. GP responsibilities: sourcing deals, leading or participating in due diligence, presenting deals to the partnership for investment decision, taking board seats on portfolio companies, providing ongoing portfolio support (introductions, hiring help, follow-on financing introductions, strategic advice), making sell decisions, handling LP communications and reporting, and managing the firm's own operations (hiring, fundraising the next fund, etc.). GP economics: management fees of 2% annually on committed capital provide operating budget for the firm (salaries, office, travel, legal, etc.); carried interest of 20% on fund profits above the hurdle rate is the major personal compensation for partners, paid only when the fund actually returns capital plus the hurdle. The 2 and 20 model means a $200M fund generates $4M annually in management fees (covering ~10 person team) and potentially $30M+ in carried interest if the fund delivers a 3x return on $200M committed. The GP commitment: GPs typically commit 1-2% of fund size as their own capital, called "skin in the game," to align their interests with LPs.
Ryan's Take
The general partner is the human you actually deal with at a VC, and the partner you raise from matters dramatically more than the firm you raise from. Different GPs at the same firm have different focus areas, different track records, different involvement levels, and different reputations among founders. Sequoia's reputation is built on the work of specific partners over decades; a new partner at Sequoia is functionally different from Doug Leone or Roelof Botha. Diligence the partner specifically, not just the firm. The brand on the door tells you almost nothing about what working with that specific partner will be like.
What founders get wrong: Treating "I raised from Sequoia" as if the firm brand were the relationship. The partner who led the investment is who you'll be working with. The partner's specific track record, board behavior, follow-on capacity, and reputation among portfolio founders are what matter. Always reference-check the specific partner, not just the firm.
Related: Limited Partner · Venture Capital Fund · Venture Capital · Management Fee · Carried Interest
FAQ
What is a General Partner?
The VC firm itself (or its managing entity, typically an LLC) that runs a venture fund, makes investment decisions, manages portfolio companies, and earns management fees plus carried interest. In contrast to LPs who provide capital but don't manage. GPs bear full operational responsibility and unlimited legal liability for fund obligations.
What does a GP do day-to-day?
Sourcing deals, leading or participating in due diligence, presenting deals to the partnership, taking board seats on portfolio companies, providing portfolio support (introductions, hiring help, follow-on financing, strategic advice), making sell decisions, handling LP communications and reporting, and managing firm operations.
How are GPs compensated?
Two main streams: management fees of 2% annually on committed capital (covers firm operating budget) and carried interest of 20% on fund profits above the hurdle rate (paid only when the fund actually returns capital plus hurdle). GPs typically commit 1-2% of fund size as their own capital ("skin in the game") to align with LPs.
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