Rolling Funds, like the vast majority of private funds (including private equity funds and many other venture capital funds), are organized to be exempt from registration as an “investment company” under the Investment Act of 1940. Exemption from registration allows the fund to avoid the robust disclosure and reporting requirements for a registered fund. As a result, it is often easier, quicker, and more cost-effective to run the fund.
To be exempt from registration, the fund must satisfy a number of requirements set by the SEC. These requirements include certain limits on the number of investors in those funds. The total number of investors allowed in the fund depends on the specific type of fund (which is why you’ll see different limitations for funds based on whether the fund accepts accredited investors or Qualified Purchasers).