Co-Investments Hit Record $47.3B in 2025: Why Investors Are Paying Up for Access
Co-Investment Funds Raised a Record $47.3 Billion in 2025
Co-investment funds — comingled vehicles that invest directly in companies alongside a general partner — raised $47.3 billion in 2025, the highest annual total on record, according to PitchBook's Q1 2026 Global Private Market Fundraising Report.
The record haul comes even as broader PE fundraising and dealmaking have struggled, underscoring the sustained demand for co-investment access at every level of the market.
Why Co-Investments Are Booming
The appeal is straightforward: co-investments give LPs direct exposure to specific companies alongside proven GPs, typically at lower fees than traditional fund structures.
"We're seeing sponsors dedicate resources to committed co-investment vehicles where there's more demand and, therefore, they can ask for fees and carry because of the way the market is going," said Cassie Kimmelman, a partner in Weil's private funds practice.
The Fee Advantage
| Structure | Management Fee | Carry | Typical Access |
|---|---|---|---|
| Traditional Buyout Fund | 2% | 20% | Broad portfolio |
| Co-Investment Fund | Lower | Lower | Direct company exposure |
| Direct Co-Investment | 0% | 0% | By invitation only |
While co-investment funds do charge fees (unlike direct co-investments which are typically fee-free), those fees are meaningfully lower than traditional two-and-twenty structures.
Adams Street Partners, which closed its sixth co-investment fund in April on $2.5 billion, exemplifies the model: "Our underlying portfolio is almost entirely comprised of fee-free, carry-free deals, and then we're passing through the majority of those savings to our end client," said partner Michael Taylor.
The Access Problem Co-Investment Funds Solve
The fee-free direct co-investment model has been a proven success for the largest institutional investors. CalSTRS reported saving over $550 million through its Collaborative Model of direct co-investments, internally managed assets, and separately managed accounts.
But there's a catch: most GPs prioritize their direct co-investment deal flow for their largest, fastest-moving LPs. If you can't write a large check on a short timeline, you're often left out.
Co-investment funds solve this by:
- Pre-committing capital so GPs can move quickly on deals
- Removing the diligence burden from individual LPs for one-off opportunities
- Providing diversification across multiple co-investments in a single vehicle
- Lowering the minimum check size to access primary deal flow
"Pooled funds solve that problem because GPs already have the capital on hand and can move quickly," said PitchBook analyst Nick Rescigno. "LPs don't have to take up time doing diligence on a single company."
What to Watch For
LPs considering co-investment allocations should scrutinize a few key areas:
- Concentration limits: Co-investment funds often have looser investment limitations than traditional closed-end funds. "I typically see looser investment limitations in these types of vehicles — there could be none," noted Kimmelman.
- Fee structures: While lower than traditional funds, fees vary widely. Understand exactly what you're paying.
- GP quality: The value of a co-investment is only as good as the lead sponsor's deal selection and execution.
- Diversification claims: Verify that the portfolio actually delivers diversification across deals, geographies, and sectors.
How This Applies to Secondary Market Co-Investments
The co-investment boom isn't limited to traditional PE buyouts. In the secondary market, SPV co-investments allow investors to participate in specific primary rounds of high-growth private companies — often alongside the same institutional GPs driving the record fundraising numbers above.
At Premier Alternatives, we structure SPV co-investments that give accredited investors access to primary rounds in companies like Fireworks AI, Positron.AI, and others — with transparent fee structures and direct company exposure.
The same dynamics driving the $47.3B record apply here: demand for quality deal flow outstrips supply, and structured vehicles solve the access and speed problem for investors who want primary exposure without the constraints of a full fund commitment.
Data sourced from PitchBook Q1 2026 Global Private Market Fundraising Report.
Premier Alternatives is a registered agent of Rainmaker Securities, LLC, a FINRA registered broker-dealer and SIPC member. This article is for informational purposes only and does not constitute an offer or solicitation to buy or sell securities.
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