Legal counsel for private equity, venture capital, hedge funds, real estate funds, and investment management: fund formation, securities-law compliance, fund documents, due diligence, and tax-aware structuring that keeps a fund within the exemption it relies on.
A private fund lives inside three exemptions at once: the adviser's from registration, the fund's from the Investment Company Act, and the offering's from the Securities Act. Each has conditions, and the anti-fraud rules apply regardless. The exemptions define the lane. The rules of the road still apply.
We form private funds, from venture and buyout vehicles to hedge and real estate funds, and we advise their managers. A manager advising only private funds, with less than $150 million managed in the United States, can file as an exempt reporting adviser rather than register; an adviser solely to venture capital funds can do so at any size. The fund typically relies on Section 3(c)(1), capped at 100 beneficial owners, or Section 3(c)(7), open only to qualified purchasers. A fund that trades futures or swaps is also a commodity pool, answerable to the CFTC unless exempt.
The offering is made under Rule 506 of Regulation D to accredited investors, with a Form D filed after the first sale. Where a regulator is involved, we have represented clients in matters before the SEC, the CFTC and the IRS.
Formation of private funds from venture and buyout to hedge and real estate, with domicile, entity and exclusion chosen for the strategy and the investors: a Delaware limited partnership under Section 3(c)(1) for a first fund with a short investor list, a 3(c)(7) vehicle once the investors are qualified purchasers, a Cayman feeder with local counsel when non-US or tax-exempt capital arrives.
Compliance with the federal and state securities frameworks that reach private funds and their managers, with anti-fraud provisions, registration-exemption conditions, and investor-suitability requirements mapped to your specific activities.
Drafting and negotiation of organizational documents, offering materials, management and advisory agreements, and investor subscription agreements, kept consistent across the package on economics, governance, and compliance.
Structuring and negotiation of investment-management and advisory arrangements, including fees, allocations, scope of authority, and the operational contracts a fund needs to run.
Representation in buying and selling fund interests and underlying investments, with negotiation, documentation, and closing support for the transactions that move a portfolio.
Tax advice coordinated with the securities and corporate work, covering entity selection, the treatment of carried interest and management fees, and structures that are efficient while remaining compliant with applicable tax regulations.
Legal and financial due diligence on funds, targets, and investment portfolios, identifying regulatory, contractual, and financial risks so they inform the structure, the disclosures, and the negotiation.
Legal analysis of investment portfolios and fund holdings, reviewing how the pieces fit together and where exposure sits, so sponsors and investors decide on a documented footing.
Private funds often avoid many registration standards, but anti-fraud provisions, exemption conditions, and investor-suitability obligations still apply, and the structure has to keep the fund within the exemption it relies on.
Section 3(c)(1) caps a fund at 100 beneficial owners, or 250 for a qualifying venture capital fund. Section 3(c)(7) lifts the cap but admits only qualified purchasers, meaning $5 million in investments for an individual and $25 million for an institution, and in practice stops at 1,999 holders of record to stay outside Exchange Act reporting.
A manager relying on the private fund adviser exemption still files Form ADV as an exempt reporting adviser, and must register once its United States private fund assets reach $150 million. The venture capital exemption has no ceiling but a strict definition: at least 80 percent in qualifying investments, borrowing capped at 15 percent and 120 days, no redemption rights. Anti-fraud and pay-to-play rules apply to both.
Fund formation documents, management agreements, and subscription agreements form one package, and the economics, governance, and compliance terms need to be consistent across all of them.
Entity selection and the treatment of carried interest, management fees, and different investor classes influence design from the outset, so tax-aware planning belongs in the structuring rather than after it.
Disciplined legal and financial diligence identifies regulatory, contractual, and financial risks early, giving sponsors and investors a documented basis for the choices they make.
Before a document is drafted, the fund is designed: entity and domicile chosen for the strategy and investor base, the registration exemption selected, and adviser status mapped. These decisions fix what the fund may do and to whom it may speak.
The limited partnership agreement, offering memorandum, management agreement, and subscription documents are drafted as one package, with carry, waterfall, fees, and governance kept consistent across every page an investor will read.
Anchor investors arrive with side-letter asks: fee breaks, co-invest rights, excuse provisions. Each concession is negotiated against the fund's most-favored-nations obligations so the first close does not compromise the last.
After final close the work turns operational: capital calls, portfolio transactions, annual compliance, and amendments. The same counsel who built the structure keeps the fund inside the exemption it relies on.
A fund is one promise written in four documents, and they had better say the same thing.
Private funds are often exempt from many of the registration standards that apply to public securities, but exemption is not the end of the analysis. Anti-fraud provisions still apply, the exemptions themselves carry conditions, and investor-suitability and disclosure obligations remain. The exemption defines the lane you are driving in, and the rules of the road still apply inside it, so structuring and documentation have to keep the fund within the exemption it relies on.
We work with private funds and the managers that run them: venture capital and private equity funds, hedge funds, and real estate funds. A venture fund usually pairs the venture capital adviser exemption with Section 3(c)(1), which allows 250 beneficial owners for a qualifying venture capital fund instead of the usual 100. A buyout fund with institutional investors typically sits under Section 3(c)(7), its manager an exempt reporting adviser until the private fund assets it manages in the United States reach $150 million. A hedge fund that trades futures or swaps is also a commodity pool, so its operator registers with the CFTC or claims the de minimis exemption and files notice with the NFA. A real estate fund that holds property directly may fall outside the Investment Company Act altogether. Nearly all of them raise under Rule 506 of Regulation D from accredited investors, who qualify at $200,000 of income, $300,000 with a spouse, or $1 million of net worth excluding the primary residence.
Fund formation typically involves the fund's organizational and governing documents, an offering document, a management or advisory agreement, and investor subscription agreements, along with the operational contracts the fund needs to run. We draft and negotiate these so the economic terms, governance, and compliance obligations are consistent across the package and aligned with the exemption the fund relies on.
Depending on structure, strategy, and assets under management, a fund or its adviser can fall within the reach of the SEC, the CFTC, the IRS, and state securities authorities. We help sponsors identify which frameworks apply to their specific activities and represent clients in matters before the SEC, the CFTC, and the IRS where a regulator is involved.
Tax considerations shape fund structure from the outset. Entity selection, the treatment of carried interest and management fees, and how different classes of investors are taxed all influence the design. We coordinate tax-aware structuring with the securities and corporate work so the fund is efficient for its sponsors and investors while remaining compliant with applicable tax regulations.
Due diligence is a legal and financial review of a fund, a target, or an investment portfolio aimed at identifying regulatory, contractual, and financial risks before they become problems. It informs the structure, the disclosures, and the negotiation, and it gives sponsors and investors a documented basis for the decisions they make.
Legal services for venture capital investments, funding rounds, and startup transactions, with securities-law compliance and deal structuring.
Explore →Compliance with securities regulation and corporate-governance standards, including SEC matters, board governance, and stakeholder protection.
Explore →Business formation, corporate structuring, and strategic planning, building the entity foundation a fund manager or sponsor operates from.
Explore →Reviewed by Jonathan D. Herpy, Sr., Senior Partner · Last updated October 2026 · Educational overview · Not legal advice
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