Key Takeaways
- • GP-led deal volume reached an all-time high in 2025, but record growth has not translated into LP satisfaction with continuation vehicle (CV) processes, according to PEI Private Equity.
- • LPs are now factoring the treatment they receive in a CV process into future allocation decisions, making process quality a direct commercial concern for GPs.
- • Key LP concerns center on conflicts of interest, key person provisions, carried interest treatment, transparency, and reporting in CV transactions.
- • Industry guidance, including ILPA's emphasis on giving LPs at least 30 calendar days (20 business days) to review election forms, is shaping how dealmakers structure CV processes.
Summary
GP-led deal volume hit an all-time high in 2025, according to PEI Private Equity, but the article by Nicholas Neveling argues that record activity does not necessarily equate to limited partner satisfaction with continuation vehicle processes. Perhaps the most significant shift is that LPs are now factoring the treatment they receive in a CV process into future allocation decisions, which elevates process quality from a reputational concern to a direct driver of capital commitments.
LP scrutiny has focused on conflicts of interest, particularly in CVs. LPs prioritize top-tier terms involving key person provisions and how carried interest is handled, as well as the broader alignment of interests between general partners and their investors. Publisher coverage of the topic notes that CVs can leave LPs in a weaker position than if an asset had been sold in a clean exit, a concern that has driven growing demand for stronger conflict management.
The article frames CVs as requiring LPs to take an active position mid-lifecycle, a departure from the traditional fund model. Many investors do not have pre-defined policies or delegated authority to respond to such decisions, which creates friction in the process. Related industry commentary highlights LP frustration with transparency, reporting and alignment, and calls for GPs to communicate clearly about the data and insights supporting valuation and deal decisions.
Process standards are also tightening. ILPA has stressed the importance of allowing sufficient time for LPs to review election forms, citing a minimum of 30 calendar days or 20 business days. A GP checklist circulating in the industry offers initial guidance on the issues GPs should address and explain to existing LPs in any CV transaction.
LP scrutiny has focused on conflicts of interest, particularly in CVs. LPs prioritize top-tier terms involving key person provisions and how carried interest is handled, as well as the broader alignment of interests between general partners and their investors. Publisher coverage of the topic notes that CVs can leave LPs in a weaker position than if an asset had been sold in a clean exit, a concern that has driven growing demand for stronger conflict management.
The article frames CVs as requiring LPs to take an active position mid-lifecycle, a departure from the traditional fund model. Many investors do not have pre-defined policies or delegated authority to respond to such decisions, which creates friction in the process. Related industry commentary highlights LP frustration with transparency, reporting and alignment, and calls for GPs to communicate clearly about the data and insights supporting valuation and deal decisions.
Process standards are also tightening. ILPA has stressed the importance of allowing sufficient time for LPs to review election forms, citing a minimum of 30 calendar days or 20 business days. A GP checklist circulating in the industry offers initial guidance on the issues GPs should address and explain to existing LPs in any CV transaction.
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