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FAQ

Fund Formation Questions

Below are the most common questions we receive about our legal fund formation packages:

Question: After I purchase your legal formation document package how I will receive my documents?

Answer: Within 1 business day we confirm all legal formation packages and deliver the documents directly to you using the email address used while purchasing the package.

Question: We are starting a fund. How should we set up the legal structure for this fund?

Answer: The typical legal structure that the majority of investors in funds expect to see is setting up the fund as a Delaware limited partnership. Since a limited partnership needs to have a general partner, it is advisable for liability purposes to create a limited liability company to serve as the general partner of the fund. FundForm’s Comprehensive Hedge Fund Package includes the necessary certificates, documents, and agreements to form both the fund and the general partner, along with comprehensive step-by-step instructions explaining how to handle every step.

Question: How much is it going to cost to set up the legal structure for my investment fund?

Answer: Partners in investment management practices at law firms in New York charge as much as $1,000 per hour. Senior associates who are experienced in setting up funds are billed at approximately $600 per hour. Having big law firms set up these funds can cost you anywhere between $40,000 to $100,000. There are smaller boutique law firms that will charge you approximately $20,000 to set up a hedge fund. FundForm is offering the same documents that you will get from any of these law firms for $995.  Note: We have updated our offerings lately, and we will soon be significantly raising this price so please purchase today if you would like to take advantage of it before it goes up.

Question: How long will it take to get the legal structure 100% setup and ready to go?

Answer: If you hire a law firm to set up your fund, you are the mercy of that law firm’s schedule. Overworked associates have numerous clients to attend to and since you are a start-up client, you will not be their first priority. Most law firms take approximately 3 months to set up a fund but it could take longer depending on the complexity. You will also be billed for every word, call and email that your law firm associate works on since if they do not bill sufficient hours, they will lose their jobs. FundForm allows you to take control of the process and set up the fund as quickly as your schedule permits.

Question: How do we know that the legal documents that we receive will be legitimate?

Answer: FundForm guarantees that if you need to ultimately hire a lawyer because the legal documents that you receive from FundForm have material errors, we will refund all of your money. Because our documents were created by top notch fund attorneys, we are confident enough to offer that absolute guarantee to you. We are fully committed to being the best provider of investment fund documents on the Internet. If you are not fully satisfied with the materials that you receive, please contact us and we will immediately correct the situation or provide a refund.

Question: I need a law firm to be included in my fund documents because my investors require it. Can I still use FundForm documents?

Answer: Absolutely. FundForm believes that start-up fund managers should be very cost conscious because the revenue of a fund manager is tied to its assets under management in the fund, which is an unknown variable. Therefore, we believe that a savvy start-up fund manager should purchase one of the Comprehensive Packages based upon the type of fund that it wants to create. Then, the manager should do as much work as possible and if they need to have a law firm involved, send the marked up documents to the law firm to minimize the billable hours spent by attorneys.

Question: Why was FundForm created?

Answer: FundForm was created by a few successful business owners, consultants, and attorneys in the investment management space who saw fellow start-up fund managers not well-served by existing options to set up private funds. FundForm thinks big law firms are too expensive and only focused on billing hours. Moreover, boutique law firms are also expensive for many start-up managers who are bootstrapping and trying to minimize expenses. In addition, other companies on the Internet offering fund documents do not offer the quality documents that FundForm provides. We firmly believe in our product and are fully convinced that you will as well.

Question: I am very cost conscious and want to set up my fund for as cheaply as possible. Can you help me?

Answer: Not only are FundForm documents inexpensive relative to documents produced by law firms but they were drafted with start-up managers in mind. For example, many law firms convince start-up hedge fund managers to form management companies in addition to their general partner entity. This additional company adds more cost to the question: additional filing fees, costs of another resident agent, more accounting and tax costs and the drafting of another operating agreement. Law firms are happy to set up this additional entity since they can bill more time to its setup and the drafting of its operating agreement. FundForm thinks that start-up hedge fund managers do not need a management company right away. If the fund is successful, the manager can certainly form a management company in the future very quickly.