Blank Rome’s Investment Management attorneys provide innovative and effective solutions for clients seeking to access the private investment fund market.
Our attorneys understand first hand all aspects of private fund formation and combine our structuring know-how with business acumen and broad industry knowledge and experience to help our sponsor clients post launch with investment management guidance and our “LP-side” clients in connection with investments, co-investments and liquidity solutions.
Our attorneys regularly advise on the formation, structuring, and negotiation of a broad spectrum of private investment funds, including:
- Private equity funds
- Hedge funds
- Venture capital funds
- Co-investment funds and sidecars
- Real estate funds
- Credit funds
- Fund of funds
- Hybrid funds
- Commodity pools
- Infrastructure funds
- Currency funds
These funds often focus on specific industries or asset classes, such as real estate, maritime, gaming & entertainment, aviation, healthcare, and energy, where Blank Rome is a market authority and we are able to utilize the skills of our recognized industry leaders.
How We Can Help
We offer a full range of services, including:
- Structuring of fund complexes, including individual commingled investment funds, single investor discretionary and non-discretionary funds-of-one, managed accounts, fund of funds, and master-feeder or parallel fund platforms
- Structuring internal governance and economic terms among the fund sponsor team
- For investors (“LP-Side”), review of fund offering documents and negotiation of terms and side letters
- Drafting governing documents for the fund and sponsor/investment management entities
- Preparation of private offering materials, including private placement memoranda and subscription documentation
- Negotiations with fund investors
- Counsel in connection with regulatory analysis and filings, including potential “pay to play” restrictions
- Preparation and review of service provider agreements
- Coordination of non-U.S. legal issues with international counsel
- Assistance in the consummation of private fund offerings
- Advice in connection with fund management and ongoing operations
- Negotiation and documentation of secondary sales and co-investments
- Mergers, acquisitions, and reorganizations (including creation of new classes of interests)
- Onboarding of additional portfolio managers for multi-manager platforms
- Negotiation related to investment management entities
- Updating of private offering materials
- Negotiation of non-disclosure agreements and side letters
- Ongoing review of service provider agreements
- Review and updating of marketing materials
- Federal and state registration of investment advisers and advice on ongoing regulatory compliance under federal and state securities laws
- Assistance with liquidations and restructurings
Forming a successful private investment fund demands experience, insight, and creativity. It’s important not only to understand your specific objectives for forming a fund, but also to assess how the fund fits into the general marketplace of private investment funds.
Blank Rome’s attorneys advise private fund sponsors in connection with raising capital for investment funds that utilize a diverse set of strategies. We employ the full breadth of our attorneys’ experience to effectively provide guidance, drawing upon capabilities from our tax, securities, banking, and ERISA practices, among other areas of focus, to assist in all stages of fund formation and with complex structuring issues. While we count among our clients many established platforms, we are equally committed to positioning the next generation of emerging investment fund managers for long-term success. Above all, we focus with our clients on the relevant touchpoints in order to successfully raise a fund in a manner that appeals to investors.
Post-Launch Investment Management Matters
Once the private investment fund is launched, Blank Rome is prepared to provide a full suite of corporate legal services, including guidance with investment management, corporate governance, assistance with investment activity, regulatory matters, and general corporate advice. We provide ongoing counsel to fund sponsors and their investment funds throughout the fund’s lifespan. Such counsel may include federal or state registration of an investment advisory entity and advice regarding SEC, CFTC, and ERISA issues; operational matters (including fund borrowing and liquidations); taxation; dispute resolution (including litigation and assistance with investor disputes); and legislative developments affecting fund sponsors and the investment strategies pursued.
Investors (“LP-Side” Representation)
Blank Rome has extensive experience representing large institutional investors and other investors on their investments in private equity funds, venture capital funds, real estate funds, and hedge funds. We have reviewed hundreds of such investments and are well-positioned to identify non-market terms. Our approach is tailored to the type of review desired in each case, spanning from written memos identifying material issues to negotiation with the fund sponsors with respect to fund terms or investor rights. Our attorneys commonly spot and raise issues which are neglected by other investors. We also regularly draft, review, and negotiate side letters and amendments to fund documentation. We believe our work in this area is unsurpassed for its combination of experience and efficiency in dealing with the various business, tax, and other issues which arise in such transactions.
Small Business Investment Companies (“SBICs”)
Blank Rome’s U.S. Small Business Administration (“SBA”) Finance Team is led by a former deputy general counsel of the SBA, who has 30 years of experience, with a primary focus on the representation of venture capital and private equity funds structured as Small Business Investment Companies (“SBICs”) and specialty lenders that make financial assistance available to small and mid-sized businesses. The SBA Finance Team is highly qualified to advise clients looking to form private funds and take advantage of the various SBA loan programs, specifically referred to as the (1) Small Business Investment Company Program; (2) the Section 7(a) Loan Program; and (3) the Section 504 Loan Program. In addition, more recently, the SBA Finance Team and attorneys in the broader Finance, Restructuring, and Bankruptcy group have advised many businesses on all aspects of the Paycheck Protection Program (“PPP”), the Main Street Lending Program (“Main Street”), and other government stimulus programs.
Managed Accounts and Co-Investments
There has been an increasing institutional investor demand for investment structures that serve as an alternative to traditional commingled private funds. This demand has resulted in the proliferation of separately managed accounts or funds-of-one and our representation of both sponsors and investors in negotiating and structuring these vehicles. In addition, consistent with the growing power of limited partners as supported by the Institutional Limited Partners Association (“ILPA”), as well as the increasing deal sizes encountered by private funds, we represent both fund sponsors and investors in connection with co-investments in various formulations (including direct co-investments, co-investment funds, and over-allocation or sidecar funds). Institutional investor clients range from high-net-worth individuals and family offices to corporate pension funds, endowments, and foundations to financial institutions, including one of the largest fund-of-funds in the world. Our private fund formation and counseling experience provides us with insight that enables us to efficiently negotiate the best terms for our institutional investor client base.
Our private funds team represents buyers, sellers, management teams, and fund sponsors in secondary sales. These secondary sales include:
- Transfers of portfolios of private fund interests
- Transfers of portfolios of direct investments
- Structured and synthetic secondaries
- Fund recapitalizations and restructurings
When secondary markets are limited, our clients benefit from our experience in secondaries, which allows us to make introductions between buy-side and sell-side parties when possible and appropriate.