Navigating Co-Investment Opportunities: A Primer for Singaporean UHNWIs
For ultra-high net worth individuals (UHNWIs) in Singapore, co-investment has become a core strategy for investing in premium private market deals whilst balancing risk and gaining control. Moving beyond traditional fund commitments co-investing enables families to directly participate on specific transactions with trusted general partners (GPs), institutional investors or peer families.
This primer is aimed at demystifying the co-investment landscape, illustrating the strategic rationale for co-investment, execution routes and important considerations offered to Singaporean families looking to develop a sophisticated direct investment capability.
Why Co-Invest? The Strategic Rationale for Singaporean UHNWIs
Co-investment is not merely a trend; it is a strategic evolution in family office investment strategy. For families with assets often managed through a dedicated family office structure, it addresses key limitations of the traditional fund model:
Enhanced Economics: Bypass layered fund fees (management and carried interest) - Having better net returns One way that a family can spend funds is to have funds directly injected into the equity of a deal with only transaction-specific advisory fees to be paid.
Targeted Control & Diligence: Gain a seat at the table. Co-investors perform their own due diligence into the particular asset, so they can go deeper and align with family-specific values (e.g., ESG criteria) than is possible with a broad family office investment strategy within a fund.
Portfolio Precision: Avoid "blind pool" risk. Instead of invest in the whole potential future pipeline of a fund, choose only the types of deals that are in line with your specific thesis, sector focus, and risk profile.
Relationship & Learning Gateway: Co-investment is the best training ground for developing internal investment muscles. It gives real-world experience in direct deal evaluation with experienced partners before setting off on an independent direct deal program.
The Co-Investment Ecosystem: Sources of Opportunity
Singaporean UHNWIs can access co-investments through several primary channels:
GP-Led Co-Investment Rights: The most common source. Negotiated as part of a primary fund commitment to a top-tier private equity or private credit manager. This grants the right, but not the obligation, to invest additional capital in specific deals the GP originates.
Club Deals & Syndicates: Formed by groups of trusted family offices in Singapore or regional peers to pool capital for a specific acquisition. This often requires a lead investor to source and underwrite the deal.
Institutional Partner Platforms: Some global banks, asset managers, and family office advisory firms operate dedicated co-investment platforms that syndicate slices of large transactions to their UHNW clients.
Strategic Introducer Networks: A specialized financial introducer can provide curated, off-market co-investment opportunities by leveraging their network of GPs and deal originators, acting as a facilitator and diligence partner.
Execution Framework: A Step-by-Step Approach
Navigating a co-investment opportunity requires a disciplined, phased process. This structured approach is employed by leading Singaporean families, from streamlined single-family offices to sophisticated multi-family operations, to ensure thorough due diligence and strategic alignment at every stage.
Stage 1: Sourcing & Screening
The journey begins with activating rights from existing General Partner (GP) relationships or engaging a trusted introducer network to surface off-market opportunities. Each potential deal must be rigorously screened against the family's internal investment committee mandate. At this critical first gate, families must ask: Does this deal align with our core sector expertise and long-term thesis? Is the lead sponsor's reputation and track record beyond reproach, and are their incentives fully aligned with ours?
Stage 2: Due Diligence (DD)
Upon passing initial screening, independent and exhaustive due diligence is non-negotiable. This involves conducting deep financial modeling, legal review, and operational assessment of the specific asset. Families must analyze the precise deal structure—be it equity, debt, or a hybrid—and critically assess geopolitical and regulatory risks, especially for cross-border transactions. The central questions here are: Do we possess the internal expertise to properly evaluate this asset, or must we engage a third-party specialist? Most importantly, what does the credible downside scenario look like?
Stage 3: Structuring & Negotiation
With diligence complete, attention turns to crafting the investment's architecture. This stage involves negotiating specific terms, including governance rights, information access, and liquidity provisions. Families must also determine the optimal holding vehicle, such as a Singapore-based holding company or a Limited Liability Company (LLC), for liability protection and tax efficiency. Key considerations include: What level of governance or board observation is required? Is our existing family office structure sufficient to manage this, or is a dedicated Special Purpose Vehicle (SPV) necessary?
Stage 4: Post-Investment Management
The work continues after the capital is deployed. Successful families appoint a clear internal representative to monitor the investment, ensuring regular performance updates are integrated into their family office software and comprehensive reporting. Proactive planning for a potential exit in alignment with the lead sponsor is also essential from the outset. Final operational questions must be addressed: Who within our team is directly accountable for tracking this asset? How will its performance be incorporated into our overall family office private markets reporting?
A critical question many families ask: "Is a family office an LLC?" The answer is structural. The family office itself is often a management company. Individual investments, especially co-investments, are frequently held within separate Limited Liability Company (LLC) structures or similar vehicles for legal protection, tax efficiency, and administrative clarity.
The Pitfalls: What Singaporean Families Must Avoid
Co-investment is not without its challenges. Common pitfalls include:
Dilution of Attention: Pursuing too many small, disparate co-investments can create administrative overload without moving the needle on overall portfolio performance.
The "Leftovers" Problem: Accepting deals that the lead investor couldn't fully syndicate to their core fund, which may be suboptimal.
Inadequate Diligence: Over-relying on the lead sponsor's work. The value of co-investment is your independent validation.
Misalignment on Exit: Failing to clarify exit timing and strategy with the lead sponsor upfront can trap capital.
Conclusion: Building a Sustainable Co-Investment Program
For Singaporean UHNWIs, co-investment represents a powerful tool for transitioning from passive capital to active ownership. Success depends not on accessing any single deal, but on building a repeatable, disciplined process—from sourcing through to monitoring.
This requires clear internal governance, defined sector focus, and often, the support of external experts who can provide access, diligence bandwidth, and execution certainty. When executed well, a co-investment program becomes the engine for superior returns, deeper market knowledge, and a lasting legacy of strategic capital allocation.
Ready to structure your family's co-investment approach? Ascendant Globalcredit Group facilitates curated co-investment access for Singaporean UHNW families, providing deal flow, strategic diligence support, and execution guidance to build your direct investment legacy.