Interview | Anthony Geraci Announces the Release of Fund Formation 101

Download the Whitepaper: https://geracillp.com/resources/education/

Introduction

Few figures have played a role as central in the evolution of the U.S. private lending industry as Anthony Geraci. As the founder of Geraci LLP, he has advised private lenders and fund managers since the earliest days of the industry, helping shape the legal and structural foundations that allowed private lending to scale into what it is today.

Anthony is also a co-founder of the American Association of Private Lenders (AAPL) and the driving force behind two flagship annual conferences that have long accompanied his law firm’s growth—today known as Elevate and Activate. In addition, he has founded and co-founded multiple companies across the private lending ecosystem, always with a strong focus on education, professionalism, and long-term industry growth.

Today, we sit down with Anthony to discuss the launch of a special new white paper, Fund Formation 101 – Structuring a Private Lending Fund for Success, a practical guide designed to help private lenders navigate one of the most consequential decisions in their growth journey.

Uriel:Anthony, first of all, thank you for taking the time to speak with us.  I’d love to start by asking — what inspired you to put this white paper together, and why did you feel that now was the right time to release it?

Anthony: Honestly? I’ve been watching too many lenders trip over the same structural landmines for the past two decades. We’re at this interesting inflection point in private lending where more and more operators are ready to graduate from deal-by-deal syndications to real fund structures—but a lot of them are doing it without understanding what they’re actually signing up for.

The timing felt right because the market’s matured to where institutional capital is genuinely interested in private lending funds, but the education gap is still huge. I’m tired of getting calls from managers 18 months into a fund saying “we didn’t include leverage authorization and now the bank wants it” or “we can’t handle these redemption requests.” Those aren’t just rookie mistakes—they’re expensive ones that could’ve been avoided with the right roadmap upfront.

Plus, let’s be real: there’s a ton of generic fund formation content out there, but almost nothing that speaks specifically to the nuances of private lending. This industry deserves better than cookie-cutter advice.

Uriel: In the white paper, you emphasize that fund formation is not just a legal step, but a strategic one. Why is that distinction so important for private lenders to understand?

Anthony: Look, anyone can draft an operating agreement and file some forms. That’s the legal part, and frankly, it’s the easy part. But here’s the thing most managers don’t realize until it bites them: the structural decisions you make on day one dictate what you can and can’t do for the entire life of the fund.

Think about it this way—choosing between an open-end and closed-end structure isn’t just checking a box. That decision affects your waterfall, your investor base, your ability to leverage, your exit strategy, everything. Same with whether you go 3(c)(1) or 3(c)(7). Those aren’t just compliance choices—they’re strategic positioning decisions that determine whether pension funds can even look at you.

I’ve seen managers treat fund formation like a transaction they need to get done so they can start raising money. Wrong mindset. The ones who succeed treat it like they’re building the foundation of an institution. Because that’s what you’re doing. You’re not just creating a legal entity—you’re defining how your business will operate, scale, and compete for the next 5-10 years.

Bottom line: Your fund structure should enable your business strategy, not constrain it. That requires thinking strategically, not just legally.

Uriel: From your experience advising fund managers, what is the most common mistake lenders make when launching their first fund?

Anthony: Hands down: underestimating operational infrastructure. It’s not even close.

First-time managers get so focused on the legal documents and raising that first close that they completely overlook the operational backbone they’re going to need. Then six months in, investors are asking where their quarterly statements are, the IRS wants K-1s, someone’s requesting a redemption, and suddenly they’re drowning in administrative tasks they never budgeted for.

Here’s a classic example: I had a client last year who raised $30 million for their first fund—crushed it on the capital raise. But they didn’t set up a fund administrator, didn’t have an investor portal, were trying to calculate NAV themselves in Excel. Three months later, a family office asked for their SOC 1 report during due diligence. They didn’t even know what that was. Killed the whole deal.

The irony is that the operational stuff isn’t that expensive relative to the fund size, but it feels like overhead when you’re in startup mode. So managers skip it, thinking they’ll “add it later.” But “later” is when you’re trying to impress institutional investors who expect white-glove service from day one.

My advice? Budget for third-party admin, annual audits, and proper loan servicing infrastructure from the jump. It’s way cheaper than trying to bolt it on after you’ve already made a mess of your investor reporting.

Uriel: Education is a central theme of this white paper. What role do you believe education plays in the maturity and long-term credibility of the private lending industry?

Anthony: This is something I’m genuinely passionate about, so buckle up.

Private lending has this reputation problem, right? For years, it was seen as the Wild West—high rates, light documentation, not particularly sophisticated. And some of that reputation was earned. But the industry has evolved massively, and if we want to keep attracting institutional capital and compete with other alternative asset classes, we need to professionalize.

Education is how that happens. When managers understand securities compliance, when they build proper governance structures, when they report like institutional asset managers—that’s when the industry gains credibility. It’s when pension funds and endowments start taking you seriously.

But here’s the thing: you can’t fake it. Investors—especially sophisticated ones—can smell inexperience a mile away. They’re not looking for managers who know how to talk a good game. They’re looking for managers who actually understand what they’re doing and why they’re doing it.

That’s why we wrote this white paper in the first place. If we can raise the baseline knowledge level across the industry, everybody wins. Managers make fewer expensive mistakes. Investors have more confidence. Regulators see a mature industry that takes compliance seriously. The whole ecosystem improves.

Look, I’m not saying every manager needs a law degree. But they should understand the strategic implications of their structural decisions. They should know why a waterfall is designed a certain way. They should be able to explain their fund’s compliance posture to a sophisticated investor. That level of education creates professionalism, and professionalism creates credibility.

Uriel: For lenders who download this white paper, what is the single most important takeaway you hope they walk away with?

Anthony: Easy: Future-proof your structure from day one.

I know that sounds vague, so let me make it concrete. When you’re forming your first fund, it’s really tempting to only think about what you need right now. You’re not planning to use leverage, so you skip the borrowing provisions. You’re raising from friends and family, so you don’t set up side letter frameworks. You don’t have distressed assets yet, so side pocket mechanics seem unnecessary.

But here’s the reality: adding those provisions later is somewhere between expensive and impossible, depending on your amendment thresholds. I’ve seen managers stuck in outdated structures because they’d need 75% investor consent to fix it, and they can’t get it. Or they end up spending $50K on amendments and consents because they skipped a provision that would’ve cost nothing to include upfront.

The case studies in the white paper drive this home. The manager who included warehouse line authorization even though they had no immediate facility lined up? When they got that credit line 18 months later, it increased investor returns by 3% and their carry went through the roof. Cost them zero extra dollars to include that language originally.

So my big takeaway is this: Think beyond fund one, raise one. Where do you want this business to be in five years? What optionality do you want to preserve? What investor types might you attract later? Build for that future today, because it’s way easier than trying to retrofit later.

Get the structure right once, and it becomes your platform for scaling. Get it wrong, and you’ll be wrestling with those structural limitations for years.

Uriel: If someone reads this white paper and wants to move forward with fund formation, what should their next step be?

Anthony: Honestly? Call us. I know that sounds like a sales pitch, but hear me out.

Fund formation isn’t something you should DIY or hire a generalist for. The nuances matter too much, and the cost of getting it wrong is too high. You need someone who’s lived in this space, who knows the private lending industry specifically, and who can help you think through the strategic implications—not just draft documents.

When you call, we’re going to have a real conversation about whether a fund even makes sense for your business right now. Because sometimes it doesn’t. Maybe you need another 12 months of track record. Maybe your deal flow isn’t there yet. Maybe syndication is actually fine for your current scale. We’ll tell you the truth.

But if it is the right move, we’ll walk you through every decision point in this white paper and help you build a structure that positions you for long-term success. That’s what we do, and we’ve been doing it for 20 years.

So yeah—read the white paper, think about your business, and then let’s talk. We’ll figure out the right path together.

Uriel: Thank you, Anthony. It’s truly an honor to have your insight with us, and we sincerely appreciate you choosing The Elite Officer as the platform to launch this white paper.

Anthony: Thank you, Uriel. I appreciate the opportunity to share this with your audience, and congratulations on The Elite Officer.

Download the Whitepaper: https://geracillp.com/resources/education/