PE/VC Pros Escape House Compensation Limits
The U.S. House of Reps on Friday passed a bill designed to limit executive compensation at large financial institutions, but private equity and venture capital pocketbooks are unlikely to be affected. Draft legislation would have applied to PE/VC firms (plus hedge), but the final bill included a clause about how affected firms -- including “investment advisors” -- must have assets of at least $1 billion. Now plenty of firms publicize their billions, but almost all of that cash in tied up in funds. Investment advisors, on the other hand, typically have between a few hundred thousand dollars and a few million dollars. As Daniel Evans, a partner with Ropes & Gray, explains it: “The funds are investment companies (like mutual funds, but unlike mutual funds they are exempt from registration), and neither mutual
