The power dynamic between limited partners and their general partner counterparts is shifting as GPs compete for fewer allocation dollars amid lower valuations, rising interest rates and limited exit opportunities. With LPs gaining leverage, pension funds, which make some of the largest commitments to private funds, may have more negotiating power than most.
This changing dynamic will have significant implications for investors, sponsors and service providers, particularly as economic uncertainty persists into the latter half of 2023. That's where Barnes & Thornburg's latest Investment Funds Outlook report, which surveyed 125 LPs, sponsors and service providers in February , comes in.
Here are five key takeaways that can help inform investment and fund management decisions in the year ahead.