News & Events

Michael Wolitzer, Head of the Firm’s Investment Funds Practice, and Partner Deborah Gruen were quoted in an article titled, “GPs get creative amid slow fundraising,” which was published by Private Equity International and detailed key trends in fundraising terms from industry practitioners in 2023. Michael noted that prewired conflicts provisions that enabled GPs to potentially forgo limited partner advisory committee approval are likely to see some changes, as will management fee discounts. Deborah enumerated ways that GPs have been addressing fundraising extensions, explaining “There’s a trend towards rolling closing, which means that you are just continuing to close as soon as LPs are done.” She added that another way to extend the fundraising period is to adjust the date from which the period starts so it starts from the effective date when GPs turn on the fund. With reference to initial closing discounts, Deborah further noted that there are rewards for loyalty for interest in multiple funds.

Michael was additionally quoted in a Private Equity International Article titled, “Oversubscription in a downturn,” which explored how one-and-done closes and significantly oversubscribed funds will no longer be the norm in today’s fundraising environment. Michael explained the most common definition for ‘oversubscription,’ explaining that “There’s often a cap in the terms of the fund agreement that says you can’t raise more than X without LP consent.” He further added that “When the GP says its oversubscribed, it is saying that it received subscriptions in excess of that amount.”

To read the full articles, please click here and here (subscription required).