Blue Sky laws are state-level regulations that provide an additional layer of protection for investors above and beyond federal securities rules. When an SPV investing in a portfolio company is formed, both the fund (as the issuer) and the portfolio company are required to file notices in the states where the SPV’s investors reside. As information requirements differ state by state, significant complexity can be introduced if your investors reside in different states. Additionally, filing fees differ in each state, so total expenses can only be determined once you have confirmed your participating investors (note that fees need only be paid once per state for a given SPV, regardless of how many investors reside in that state).
The Flow team has filed thousands of Blue Sky fees and will ensure your SPV is fully compliant.
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