17 May 2022
Single, and Ready to … Invest! Negotiate your Single-Investor Fund
A single-investor fund (SIF) is an entity created at the request of, and designed specifically for, an investor or group of affiliated investors (and sometimes called a “fund of one”). SIFs have become increasingly common in the alternative investment space and provide an opportunity for larger investors to enjoy the benefits of a fund with the added ability to customize terms to their particular economic, regulatory, and other needs. Key issues to consider when entering into negotiations with a potential SIF investor include whether to establish a SIF or a separately managed account for a particular investor or investor group, to what extent a SIF will invest alongside other clients of the sponsor, whether the SIF investor triggers any specialized regulatory considerations, to what extent a SIF investor will receive "MFN" rights, whether to implement rebalancing when a SIF has multiple affiliated investors, and how to dispose of assets if a SIF is terminated early.
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- The Challenges of Managing a Customized Fund Structure: What Fund Managers Should Know about Single-Asset and Single-Investor Funds
Read this overview of the similarities and differences of single-asset and single-investor fund structures, and how each type of fund can be used most effectively.
- Most Favored Nation (MFN) Side Letter Clause (Private Equity Fund)
Consult this sample MFN provision that provides several options when extending special rights to private fund investors.
- Registered Investment Adviser Handbook Chapter 3: Which Investment Advisers Must Register under the Advisers Act?
Review this portion of the Registered Investment Adviser Handbook that delineates which advisers are required to register with the SEC, and the exclusions from registration.
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