How Long Does It Take to Raise a Fund?

Now that you’ve decided to become a successful fund manager, it’s time to learn how the process actually works. If you’re in a hurry, you might be wondering:

“How soon can we close?”

Budget at Least a Month to Raise Your Fund

If everything goes smoothly and LPs sign their documents quickly, GPs can complete the entire process in about one month after contacting a fund-formation lawyer.

Once, we completed a fund in three weeks — but it was intense. I don’t recommend it. For a comfortable timeline, budget about six weeks.

Before contacting a lawyer, there’s important pre-work you should complete. Doing this in advance will save you money, time, and frustration.

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What to Do Before Talking to a Lawyer

Contacting a fund-formation lawyer is one of the most important steps in forming a fund. Your attorney will guide you through the entire process and quarterback your raise.

But to keep legal costs under control, you should do as much preparation as possible upfront. If you approach a lawyer with a half-baked plan, you’ll spend unnecessary hours — and money — figuring out basics.

Here’s what to do first:

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Target Your Asset Class

Identify which specific asset class you want to focus on. Your chosen class shapes the entire fund formation process.

You should be an expert uniquely suited to generate strong returns in that asset class.

“Specific beats general.”
A hybrid VC / private equity / real estate fund is almost always a red flag for LPs. They prefer specialists — they diversify on their own.

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Decide Whether You Want a Multi-Asset Fund or a Single-Asset Syndication

We’ll explore this in detail in Chapter 4, but here’s the quick version:

• Multi-asset funds hold multiple assets (e.g., several apartment buildings, multiple SaaS companies).
• Syndications hold only one asset (e.g., one apartment building or one fintech investment).

Many new GPs start with syndications, build a track record, then “level up” to multi-asset funds.

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Decide Whether You Want a Closed-End or Open-End Fund

Closed-end and open-end funds operate differently:

• Closed-end funds
  • Have a defined lifespan
  • Common in illiquid assets (real estate, private equity, venture)
  • LPs typically see liquidity only at the end of the fund’s life
• Open-end funds
  • No defined term
  • Common in liquid asset classes
  • LPs can usually redeem after a lock-up period

More detail in Chapter 5.

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Research Market Terms

Understand what’s standard in your industry.
You don’t want to propose confusing or unconventional terms.

Talk to:

• Other GPs
• Potential LPs
• Your lawyer

LPs’ expectations matter most.

Draft a Preliminary Marketing Deck

Your deck should include:

• Your investment thesis
• Tentative terms
• Your background
• Any track record
• Charts/visuals explaining the opportunity

Most decks are 10–30 pages.

You’ll refine it after your lawyer reviews your terms.

Reach Out to Friends and Family

Share your idea with people you trust. Get candid feedback.

If your friends and family aren’t excited about your deal, consider revisiting the strategy — it might not be compelling enough yet.

Collect “Soft Commitments”

Keep a running list of investors who express interest.

After the legal documents are ready, send them subscription packages so they can officially invest.

⚠Fund Trap #1: Going to a Lawyer With a Half-Baked Idea

Preparation matters. Changing your mind repeatedly on:

• Structure
• Terms
• GP team
  …creates confusion, frustrates LPs, and inflates your legal bill.

At a major law firm I worked at, one client changed directions constantly. An LP dropped out due to the chaos — and their legal bill ballooned. Do your groundwork first. You’ll save time, money, and headaches.

Step 1: Prepare the Legal Summary of Terms & Marketing Deck

Once your research and decisions are solid, it’s time to contact your fund-formation lawyer.

Your attorney will draft a comprehensive summary of terms, typically:

• 4–10 pages for syndications
• 15–20 pages for multi-asset funds

This document includes the key business and legal terms LPs need to review before investing.

Once finalized:

• Update your marketing deck to include the final terms
• Incorporate any securities law feedback

More details on what goes into this document appear in Chapter 6.

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How Long Does Step 1 Take?

Drafting a summary of terms can take:

• 1–2 days for a simple fund
• Up to a week or more if non-US or tax-exempt investors are involved

Sometimes tax counsel and specialists must weigh in.

Step 2: Draft Fund Documents and Form Legal Entities

After the summary of terms is complete, your lawyer prepares the long-form documents, including:

• Limited partnership agreement
• Subscription documents
• Private placement memorandum (PPM)
• Other supporting documents

They will also form:

• The fund entity
• The GP entity
• The management company

Details on these entities appear in Chapter 2.

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How Long Does Step 2 Take?

Drafting fund documents usually takes:

• 2–4 weeks for a fund
• Less for a syndication, as the documents are simpler

If foreign investors are involved (e.g., in real estate funds), additional jurisdictions such as Cayman or BVI might be required, which can extend the timeline.

Entity formation itself is typically quick — about a week.

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Step 3: Signing the Documents & Holding the Initial Closing

There are two main components:

1. LP Negotiations
   Investors may want to change certain terms. (Covered in Chapter 9.)
2. Signing the Documents
   You must coordinate communication and get all LPs to sign.

Your lawyer will also file the required SEC forms and ensure the closing is handled properly.

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How Long Does Step 3 Take?

Timelines vary depending on LP responsiveness.

Some LP groups sign immediately.
Others require multiple follow-ups — especially during summer holidays when investors are traveling.

Set expectations early and communicate the initial closing date well in advance.

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How to Raise Your Fund as Quickly as Possible

1. Don’t Flip-Flop
   Stay consistent after choosing a structure and terms.
2. Communicate Clearly
   Keep LPs updated about timelines.
   Respond quickly to your lawyer and administrator.
3. Decline/Defer Negotiations
   Negotiations slow everything down.
   If you have the bargaining power, offer a “take it or leave it” deal.

Now that you understand the typical fund-formation timeline, let’s move to the part everyone cares about:

How you’ll get paid.