Co-investment is no longer a niche alternative to traditional venture and private equity funds. As investors demand transparency, selectivity, and stronger alignment, curated co-investment platforms are becoming the preferred gateway to private markets. This rise reflects a structural shift: investors want control back over deal selection, risk exposure, timing, and return profiles.

Why co-investing is surging

Over the past five years, co-investing has moved from the sidelines into the mainstream. Family offices, high-net-worth individuals, and even institutional LPs are increasingly seeking co-investment opportunities to complement (or replace) traditional fund commitments.

First: control. Co-investors gain direct access to individual private deals, whether in venture, growth, or buyout, without committing blind capital to a 10-year fund structure. This growing appetite has fueled the emergence of curated co-investment platforms, offering professionally vetted deals, structured access, and lower friction than conventional private market vehicles. LPs on co-investment platforms can select deals through specialized co-investment funds, often with significantly reduced or no management and performance fees.

Second: performance. Industry data shows co-investments have average gross total value to paid-in (TVPI) multiples around 2.7x, compared to roughly 2.2x for commingled funds. This outperformance stems from lower fee drag, a critical factor detailed in fee checklists. 

Co-investments often see fees reduced by 50% or more, directly boosting net returns. This fee efficiency is a powerful driver, especially when considering that in traditional funds, management fees alone can consume 15% to 20% of committed capital over a typical ten-year fund life.

Deal-by-deal co-investing explained

Deal-by-deal co-investing allows investors to evaluate opportunities one at a time, choosing only the businesses that fit their strategy, risk tolerance, and time horizon. This model brings several educational advantages:

  • Transparency and deal-level visibility: Co-investing grants LPs direct insight into underlying assets rather than relying on a fund that conceals specific exposures until exit. This transparency helps investors better align deals with their expertise or thematic focus.

  • Fee efficiency and enhanced returns: Co-investments usually come with lower fees than traditional funds, removing layers of management and carried interest that can erode returns. This directly addresses the complex fee structures of traditional PE, where investors must scrutinize everything from management fee calculation bases (committed vs. invested capital) to hurdle rates and waterfall structures for carried interest. With fewer fees, net returns to investors can be materially higher.

  • Customization and portfolio diversification: Investors can select deals that suit their risk appetite, sector preferences, or geographic focus. This tailored approach permits building a diversified portfolio across managers, industries, and regions while avoiding unwanted exposures.

  • Access to top-tier managers and larger deals: GPs often offer co-investments to deepen capital pools for sizable transactions and strengthen existing LP relationships, providing investors with exclusive access to high-conviction opportunities.

For new entrants, platforms now offer clear frameworks on how co-investments reduce risk, from diversification strategies to underwriting discipline and alignment with lead investors.

How do co-investment platforms work?

Deal sourcing and vetting: LPs receive tailored deal flow aligned with their investment mandates, leveraging platform expertise and GP networks.

Flexible investment structures: Co-investments can be transacted via separate special purpose vehicles (SPVs), direct equity stakes, or pooled funds that aggregate several co-investments.

Streamlined capital deployment: Unlike traditional fund capital calls, co-investment commitments are deal-specific and typically require faster decision-making and deployment.

Governance and oversight: LPs often have more rights and visibility on governance matters for co-investment stakes compared to blind funds, though usually without full control.

Reporting and compliance: Platforms provide enhanced reporting tailored to individual deals, simplifying performance tracking and regulatory compliance for investors. This is a significant advantage over traditional funds, where LPs must vigilantly monitor for opaque costs like organizational expenses, broken-deal fees, and placement agent fees, which can be capped in co-investment structures but are often passed through in full in blind-pool funds.

The bottom line 

The rise of co-investment platforms signals a clear evolution in private markets: investors want more transparency, lower fees and the ability to choose their own opportunities. What makes this shift especially powerful is the educational component. Co-investors today are getting more proficient; they’re learning how fee structures work, how risk is underwritten and how to build diversified portfolios with intention.