A co-investment is a unique opportunity sometimes offered to investors in an AIF. It allows them to invest additional capital directly into a specific portfolio company that the fund is backing, separate from their main fund commitment. This is typically offered when the fund manager has high conviction in a particular deal and wants to deploy more capital into it.
The primary benefit for the investor is the ability to increase their exposure to the fund’s most promising assets, often with lower fees than the main fund. It provides more control and the potential for higher returns if that specific company does exceptionally well. Co-investments are a way for investors to double down on success alongside a trusted fund manager.
