"Planning a Hedge Fund Launch? SEC Registration Thresholds For Start-Up Managers" by Scott Budlong

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September 20, 2012

A critical gating question for the founder of a new hedge fund manager is whether the firm will be required to register with the SEC as an investment adviser under the Investment Advisers Act of 1940. If registration is required at the outset of the new firm’s operations, client advisory work may not begin until the registration process is complete.

In this memorandum, Scott C. Budlong partner at Richard Kibbe & Orbe LLP's private fund advisers practice, reviews the law and regulations relevant to new hedge fund managers’ planning with respect to SEC registration. The memorandum addresses the prototypical adviser with its principal office and place of business in the United States and clients consisting of one or more “private funds,” i.e., pooled investment vehicles excluded from investment company status under §3(c)(1) or §3(c)(7) of the Investment Company Act of 1940.

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