Private investment fund sponsors, both domestically and foreign, seek our guidance throughout the complicated process of forming a private investment fund, offering fund interests in the United States and operating and maintaining their fund for the duration of its term. Our clients include sponsors of hedge, private equity buyout, real estate, credit and venture funds, as well as OCIOs, fund-of-funds and special purpose funds. Sponsors rely on our experience with both the buy- and sell-side of the industry to improve their understanding of investor expectations and better align their interests. Clients prefer our tailored approach, which allows us to provide greater responsiveness, access to partner-level expertise and flexibility to meet cost-containment goals and allows them to focus on implementing their investment strategies.
We offer a practical approach based on our knowledge of the preferences and perceptions of institutional investors. We can assist fund advisers with legal documents that reflects a more balanced approach to appeal to potential institutional investors.
We advise sponsors throughout a private fund’s life-cycle, beginning with the initial engagement of service providers (e.g., administrators, placement agents, auditors), spinout negotiations, negotiations with seed investors, preparation of legal documents, federal and state offering registrations, adviser registration or exemption, portfolio investments and harvesting and final wind-down. Included in our services are the following:
- Tax-efficient fund structures, including offshore blocker and feeder structures and the implications of U.S. domestic and offshore fund structures
- Preparation of disclosure documents, including pitch-decks and private placement memoranda
- Preparation of organizational and subscription documents
- Special investor arrangements, including side letters, co-investment vehicles and seed investment arrangements
- Registration or exemption notice filing of the private fund manager under U.S. federal and state securities laws
- Compliance with exemptions from investment company and securities offering registration under U.S. federal and state laws, including offerings by non-US fund managers
- Compliance with advertising regulations under U.S. federal and state securities laws
- Negotiation of credit facilities
- Ongoing compliance with U.S. federal and state securities laws
Through extensive, long-standing industry contacts, ongoing vigilance and our participation in the investment management industry, we continuously monitor and update our clients on regulatory and business developments that may affect them. We enjoy strong relationships with other financial industry service providers, including accountants, administrators, third-party marketing firms, compliance consultants and local law firms across the globe.
In addition to more traditional hedge, private equity and real estate offerings, recent fund formation matters include:
- Two hedge funds trading leveraged ETFs
- A hedge fund trading cryptocurrencies
- A quantitative hedge fund with a global, diversified portfolio
- A fund-of-funds trading public and private securities with a focus on sustainable strategies
- A “fundless sponsor” investment vehicle formed to acquire and develop a consumer products brand
- A private, multi-strategy real estate fund including a $20 million debt co-investment vehicle
Our experience includes:
- Representing an institutional hedge fund manager in establishing various “funds of one” for new investors. These funds are subject to a firm-level gate on investor withdrawals.
- Representing numerous managers in seeding arrangements with institutional investors.
- Advising a hedge fund of funds sponsor in creating a special “co-invest” series for both its onshore and offshore funds. The co-invest series allows interested investors to allocate additional capital to best ideas opportunities offered by underlying managers.
- Advising an Irish manager in launching a master–feeder fund with investors composed mainly of US tax-exempt institutions and family offices. The fund provides multiple share classes with differing management fee and incentive allocation terms.
- New York, NY, 11.05.2018
- Richmond, VA, 10.09.2018