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When raising a fund, is it okay to require an LP or Venture Partner to bring on another LP before including them in the fund closing? I understand that Venture Partners cannot be compensated based on money raised due to broker-dealer regulations but this seems diffferent

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May 04, 2024
2 answers
Accepted Answer
May 05, 2024
It's ok to encourage LPs and VPs to make introductions to LPs. There is no way to require any LP or VP to have one of their connections invest in the fund, however. 
Accepted Answer
May 05, 2024
I see. So, if we do have an potential LP--who has signed an LP pact--that wants to be a VP, is it fine for us to ask them to bring in an additional LP before we make them a Venture Partner at closing? 
No. That's quid pro quo and turns it into a broker dealer situation. 
May 05, 2024 12:15am
Thanks
May 05, 2024 12:48am
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