LPs are those investors who invest capital in the fund.
LPs are those investors who invest capital in the fund. The LP list would include institutional investors, high-net-worth individuals, family offices, and sometimes corporations. LPs' risk is limited because they can lose only up to their investment in the fund, without any of them handling the management of the fund.
This is because, in this case, the GPs act as active managers of the fund, and LPs are passive investors.