Most SPVs follow the same path from term sheet to closing. The deal terms change, but the steps don't, and once the first SPV is done the forms can be reused for the next one. This is the checklist we work through for a typical SPV that invests in a single private company and raises money from accredited investors under Regulation D. It assumes the sponsor's GP entity and management company already exist. If they don't, start with GP Entity and Management Company: Do You Need Both on Day One?

1. Form the SPV or Designate a Series

For a standalone SPV, that means filing a certificate of formation in Delaware (or a certificate of limited partnership if the SPV is an LP), appointing a registered agent, obtaining an EIN, and opening a bank account. For a sponsor using a Delaware series LLC, it means adopting a series designation under the master operating agreement before the series takes in money or signs anything. The choice between the two is covered in Series LLC or a New SPV for Every Deal? Delaware entities can be formed within days using expedited service. The bank account often takes longer than the filing, so start it early, especially if a principal is outside the United States.

2. Operating Agreement With the Deal Terms

The operating agreement (or series designation) is where most of the legal work sits. It should cover:

  • the GP entity's authority as managing member, and the decisions that need investor consent;
  • capital contributions, and what happens if an investor doesn't fund;
  • the carry, any management fee, and which expenses the SPV bears;
  • the distribution waterfall, including in-kind distributions of the portfolio company's shares;
  • transfer restrictions, including limits that protect the SPV's Investment Company Act exclusion;
  • investor reporting and tax provisions, including who acts as partnership representative; and
  • exit, dissolution, and winding up.

If the management company charges a fee, a short management agreement between it and the SPV sets out the services and the fee.

3. Subscription Documents, Questionnaire, and AML/KYC

Each investor signs a subscription agreement and completes an investor questionnaire. The questionnaire does more than confirm accredited status. It also collects what is needed to count beneficial owners for the Investment Company Act and to identify entities that may require a look-through, both covered in Investment Company Act Limits for SPVs. It also collects tax forms (W-9 or W-8) and the identity and source-of-funds information for anti-money-laundering and sanctions screening.

On AML specifically, FinCEN adopted a rule in 2024 that would require registered investment advisers and exempt reporting advisers to maintain AML programs. It has since postponed the rule's effective date to January 1, 2028, and said it will revisit the rule's scope. Banks and counterparties already expect KYC on SPV investors, so it belongs in the subscription package now. The Private Fund Subscription Agreement: What Managers Often Miss covers the provisions that tend to get skipped.

4. Choose the Exemption and Run Bad Actor Checks

Decide before marketing starts whether the offering relies on Rule 506(b) or Rule 506(c). Rule 506(b) prohibits general solicitation, so investors usually come from existing relationships, and accredited status can be self-certified. Rule 506(c) allows open marketing, including on a website or platform, but every purchaser must be accredited and the issuer must take reasonable steps to verify it. The trade-offs are in Rule 506(b) vs. 506(c), and the high-minimum route to verification is in Rule 506(c) Verification With a High Minimum Investment.

We generally recommend limiting SPVs to accredited investors even under 506(b). A 506(b) offering that includes any non-accredited purchaser triggers the information requirements of Rule 502(b), which are much heavier than a deal memo.

Rule 506 is also unavailable if a covered person is subject to a disqualifying event under Rule 506(d). Covered persons include the issuer, its managing member, the investment manager of a pooled investment fund, and anyone paid to solicit investors. Collect a short bad actor questionnaire from each of them. See Bad Actor Disqualification Under Regulation D.

5. Deal Memo or Risk Disclosure

Even when no particular disclosure document is required, investors should receive a written description of the investment, the terms of the SPV, the sponsor's economics, the material risks, and the conflicts of interest. The antifraud provisions apply to what the sponsor says and leaves out, and an adviser to a pooled investment vehicle is also subject to Rule 206(4)-8. A clear deal memo, consistent with the operating agreement, protects the sponsor as much as the investors.

6. Collect Funds and Close

Closing means countersigning the accepted subscriptions, collecting funds in the SPV's account, admitting the investors as members, and updating the member schedule. Then the SPV funds the investment and receives the portfolio company's shares or other securities in its own name. Check that the portfolio company's documents (the purchase agreement, investor rights, and any joinders) name the SPV correctly, and that the SPV's authority to sign is documented.

7. Form D and State Notice Filings

Rule 503 requires a Form D to be filed with the SEC no later than 15 calendar days after the first sale in the offering. If that day falls on a weekend or holiday, the deadline moves to the next business day. The SEC staff treats the date of first sale as the date the first investor is irrevocably contractually committed to invest, which can be earlier than closing. Form D can also be filed as soon as the offering begins, before any sale.

Securities sold under Rule 506 are covered securities, so states cannot require registration. However, states can require a notice filing, a consent to service of process, and a fee. Each state where investors reside has to be checked.

Form D also has to be amended in some cases: to correct a material mistake, to reflect certain changes, and annually if the offering is still continuing on the anniversary of the last filing. Filing Form D is not a condition of the exemption itself, but Rule 507 can disqualify an issuer that has been enjoined for failing to file, so it shouldn't be treated as optional.

8. After Closing

The SPV needs a tax return and K-1s each year, the Delaware annual tax, a registered agent, investor reporting under the operating agreement, and records of valuations and distributions. The adviser files its annual Form ADV update if it is an exempt reporting adviser. Once there are several SPVs, a fund administrator can take over capital accounts and K-1s.

9. Reuse the Forms

The second SPV is faster than the first. The operating agreement, subscription agreement, questionnaire, deal memo template, and closing checklist carry over, and only the deal-specific terms change. A first SPV is often a matter of a few weeks from term sheet to closing documents. Later SPVs on the same forms move faster, especially within a series LLC.

If you have a deal coming up and want to work through this checklist for your SPV, we're glad to help. More detail on our SPV work is on the SPV formation page.