Ropes & Gray has made a high-level lateral hire in Chicago, bringing aboard a partner from Mayer Brown’s funds practice.
Matthew Posthuma represents clients in the formation of private funds and advises many types of funds, including real estate funds, hedge funds, debt funds, and foreign country funds, on their investment strategies.
In a discussion with IFLR1000, Posthuma described a heightened tempo of fundraising as well as an approach to capital raising that contrasts with past years. When the great recession arrived, market participants had been at a peak in terms of fundraising, he noted. Several years after the crisis, as fundraising has begun to accelerate again, Posthuma has observed that as more capital is being raised, it’s being handled by a smaller and smaller group of managers, investing money for their clients across a range of asset classes, he said.
“Additionally, I think what you’re seeing is that people are seeking to raise capital from an increasingly wide variety of sources – not just the old domestic pension plans and foundations and endowments, but also from international investors, sovereign wealth funds, and high net-worths in other countries,” Posthuma continued.
Posthuma observed that no one working in the U.S. private sector at this point, unless he or she is very senior, is entitled to a pension anymore, but rather is likely to have a 401K plan. A traditional source of capital for the institutional and fund sponsors is disappearing, he noted.
“If you look at everything going on in the world – the Euro crisis resurging, the issues with China, the talk about a real estate bubble and maybe growth slowing down there – the U.S., relatively speaking, is becoming a very stable place for people to put their money. Foreign investors are saying, How can I get my money into the U.S. and invest in the U.S.? The challenge for fund sponsors that invest in the U.S. is to come up with structures that allow foreign investors to invest in a regulatory-efficient and tax-efficient way,” Posthuma added.
Posthuma holds a J.D. from Harvard Law School and an A.B. from the University of Michigan.