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Kirsten Bischoff, Opalesque New York: On Tuesday, hedge fund professionals met in New York for the first of four Opalesque Hedge Fund Workshops covering tax and legal issues. The first workshop, which focused on “Dissecting the Private Placement Memorandum” was led by panelists Jeffrey B. Cobb, Esq and Partner at Edwards Angell Palmer & Dodge LLP law firm, Robert Frucht, Esq and Partner at Crowell & Moring LLP, and Richard D. Nichols, CPA, JD, LLM and Managing Director at RSM McGladrey Inc.
The three approaches to writing a PPM
During the early discussion led by Cobb, he cited three approaches to writing a PPM: the insurance model, the business model, and the marketing model. In the best case scenario, fund managers and their team of advisors approach writing this foundation document with an eye to fulfilling the goals of each approach.
The business model and the insurance model are both long established approaches to writing this document. However, the increasing sophistication of investors has been one of the main catalysts in the evolution of PPMs to also include the marketing model. During an interview for Opalesque’s recent series on asset raising, Paul Eckel of the firm Emerging Manager noted that every document is an opportunity to market your fund. The panel discussion today re-affirmed that view. During the discussions Cobb noted that with fund documents investors are sometimes of the opi...................... To view our full article Click here
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