No - VC managers only
Standard RIA restrictions
Yes
No
Disclaimer
Summary
New Hampshire is not a particularly prominent hub for asset managers or by hedge fund count, and it is also not a particularly friendly jurisdiction for emerging managers, as it has no exemption framework. Hedge fund managers must become registered investment advisers regardless of AUM or circumstances, although certain qualifying venture capital managers can be exempt.
Registered investment adviser hedge fund restrictions
Because New Hampshire does not allow for exemption, the information below relates to restrictions for New Hampshire registered investment advisers.
Investor restrictions
Investors in a RIA-managed fund must be qualified clients to be charged performance fees; accredited investors are allowed but only management fees can be charged.
Reporting requirements
Standard RIA filings and notice filing by way of Form ADV is required.
Audit requirements
Funds managed by RIAs must undergo an annual, third-part audit.
State-specific nuances
Only certain qualifying venture capital fund managers can be exempt.
Detailed Summary
New Hampshire has not implemented any exemption framework for private fund advisers, except for certain qualifying venture fund advisers. A qualifying venture fund adviser has a specific definition that is not attainable by hedge fund advisers. This makes New Hampshire a relatively more challenging state to be an emerging manager in, in the sense that the minimum operating cost and administrative burden of being an emerging manager that is a registered investment adviser (an “RIA“) is higher than that of states that do have an exemption framework. There are approximately 5-10 states with a similar framework (or lack thereof).
Because advisers based in New Hampshire must be RIAs, advisers must take into account the licensure requirements (which may entail, for example, the holding of the FINRA Series 65) and the cost of RIA registration (typically through a law firm and costing between $15,000 and $30,000 on the lower end), as well as ongoing RIA compliance costs each year.
Restrictions for state registered RIAs with respect to private funds generally entail being restricted to qualified clients (if performance related compensation is desired), having each fund undergo an annual audit, and possibly other, state-specific RIA requirements around reporting and custody. This article does not contemplate state-specific RIA requirements, and any such prospective advisers should seek the guidance of counsel.
Repool can still be utilized for fund launch by RIAs, but Repool does not generally assist with RIA registration or RIA-specific ongoing complaince, and additional such services alongside Repool’s services will be required.
