Plain-language definitions of terms you may see on this site and in offering materials. Private markets have their own vocabulary - this page is here to make that vocabulary clearer.
An individual (or entity) who meets specific income or net-worth thresholds set by the SEC and is therefore allowed to invest in certain private securities offerings. In general, this means net worth over $1 million (excluding primary residence) or income over $200,000 individual / $300,000 joint in each of the prior two years, with a reasonable expectation of the same for the current year. Other categories also exist. Letterbox Capital accepts accredited investors only.
A fund structure in which investors commit capital without choosing the specific underlying deals in advance. The fund manager sources and selects investments according to the fund’s strategy. Letterbox’s evergreen fund operates as a blind pool: investors commit to the fund; they do not pick individual deals.
A person or firm responsible for deciding how capital is invested - for example a private equity firm, venture fund, family office investment team, or institutional investment manager. Letterbox sources opportunities through strategic relationships with sophisticated capital allocators in Ohio.
The amount of capital an investor writes into a single deal or fund. Institutional check sizes are often much larger than what an individual professional can comfortably write. A co-investment / feeder structure can help smaller accredited checks participate alongside larger partners.
Investing alongside another investor (often a lead institutional investor or fund) into the same opportunity, typically on the same or similar terms. Letterbox is structured as a co-investment fund: the fund invests alongside other sophisticated capital allocators rather than solely originating every deal in isolation. This is a core point of differentiation.
The research and analysis performed before committing capital - reviewing financials, market, team, legal structure, risks, and terms. In a co-investment model, diligence is often shared or led by experienced partners with deep underwriting processes.
A fund that does not have a fixed end date the way a traditional closed-end private equity fund does. Capital can remain invested and be recycled over time, and the vehicle can accept capital on an ongoing or periodic basis (subject to the fund’s specific terms). Letterbox operates an evergreen structure with structured liquidity features.
The manager of a private fund. The GP is responsible for sourcing, diligence, investment decisions, and operations. Limited Partners (LPs) commit capital; the GP manages it according to the fund’s governing documents.
Capital from large, professional investors such as pensions, endowments, foundations, insurance companies, large family offices, and institutional fund managers. “Institutional-quality” generally means opportunities, processes, and standards associated with that level of investor - larger checks, formal diligence, and professional oversight.
An investor in a private fund. LPs commit capital and typically have limited liability and limited day-to-day control. In Letterbox’s structure, accredited individual investors participate as LPs in the evergreen fund.
Different private asset classes tend to return capital on different timelines. Real estate can often provide liquidity over months to a few years; private equity over a handful of years; venture capital often over roughly 8-12 years. With a mature portfolio that continually invests and exits across all three, liquidity events can surface on a more regular basis - sometimes described as similar to a laddered bond portfolio - with capital available to distribute or reinvest according to the fund’s terms.
How easily and quickly an investment can be turned into cash. Private fund interests are generally less liquid than public stocks. “Structured liquidity” means the fund has defined rules (for example periodic redemption windows) under which investors may request to redeem, subject to the fund’s terms, gates, and available liquidity.
The governing document for a limited liability company (LLC). It sets out ownership, management rights, voting, distributions, transfer restrictions, and other rules among members. For many private funds structured as LLCs, the operating agreement (sometimes together with a limited partnership agreement for LP structures) is a core legal document investors should review.
Also called an offering memorandum or private placement memorandum. A detailed disclosure document provided to prospective investors in a private offering. It typically describes the investment strategy, risks, fees, structure, management, conflicts, and other material information. Investors should read the PPM carefully before subscribing. It is not a public prospectus and is used in offerings exempt from full SEC registration.
The contract by which an investor agrees to purchase an interest in a fund or private offering. It usually includes investor representations (for example, accredited investor status), the amount of capital committed, and acknowledgments of risk disclosures. Completing and signing the subscription agreement is a formal step in the investment process, typically after reviewing the PPM and other offering materials.
Investments in companies that are not publicly traded on a stock exchange. Strategies vary (growth capital, buyouts, etc.). Private equity is one of the three primary asset classes in Letterbox’s focus, alongside Real Estate and Venture Capital.
Investments that are not traded on public exchanges - including private equity, private real estate, venture capital, private credit, and similar. Access is often limited to accredited or institutional investors and typically involves longer holding periods and less frequent pricing than public markets.
In this context, privately held real estate investments (development, acquisitions, income-producing properties, etc.) rather than publicly traded REITs. Letterbox’s real estate focus includes projects that support Ohio’s long-term development where fundamentals are strong.
Equity investments in earlier- or growth-stage private companies, typically with higher risk and higher potential return profiles than mature private equity. Letterbox’s venture focus is generally later-stage / growth-oriented opportunities sourced through experienced partners.
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