A smooth fund administrator relationship starts months before the first capital call. Emerging managers who treat administrator onboarding as an afterthought often face preventable delays at first close, scrambling to gather documents while investors wait. The preparation window between selecting an administrator and calling capital typically determines whether that first close runs smoothly or becomes an operational fire drill.
When Should Administrator Engagement Begin?
Most experienced fund administrators recommend engagement at least three to six months before first close. This timeline allows sufficient runway to set up accounting systems, establish reporting templates, and complete investor onboarding workflows before capital needs to move. Starting earlier also gives the administrator time to understand the fund's specific waterfall mechanics and any non-standard LPA provisions that affect allocations.
What Documents Does the Administrator Need?
Fund administrators typically request:
Limited Partnership Agreement (LPA) — the governing document that defines economics, fee structures, and waterfall mechanics
Private Placement Memorandum (PPM) — outlines investment strategy, risk factors, and regulatory disclosures
Subscription agreement template — the contract each LP signs committing capital
Side letter summary — documenting any investor-specific terms (MFN provisions, fee breaks, co-invest rights)
Bank account details and signatory authorizations — required for capital call processing
Prior fund financials (if applicable) — helps establish reporting continuity for successor funds
How Should the Chart of Accounts Be Structured?
The chart of accounts forms the backbone of fund accounting. Most administrators have standard templates, but customization often proves necessary for funds with complex fee arrangements or multiple share classes. Key considerations include separate tracking for management fees, organizational expenses, broken deal costs, and portfolio company-level investments. Funds with European LPs or those making cross-border investments may need additional accounts for withholding tax tracking.
What About Investor Onboarding?
Investor onboarding runs parallel to fund-level setup. Administrators collect LP information including tax identification, KYC/AML documentation, wire instructions, and accreditation verification. For a $150M Fund II with 35 LPs, this process commonly takes several weeks when LPs respond promptly, longer when investors are slow to return documentation. Starting LP outreach early prevents subscription agreement backlogs at first close.
What Makes Onboarding Go Sideways?
Common pitfalls include incomplete LPA exhibits (particularly waterfall schedules), mismatched side letter terms across investors, and unclear expense allocation policies. Administrators also flag situations where the GP hasn't finalized banking relationships or where the LPA contains provisions that conflict with standard accounting treatment.
The relationship between a fund and its administrator can span a decade or more. Taking the time to provide complete documentation upfront, and establishing clear communication channels before capital starts moving, tends to pay dividends through smoother quarterly closes and faster LP reporting throughout the fund's life.