Clients and Associates,

California’s Fair Investment Practices by Venture Capital Companies Law requires certain investment advisers to report information about their venture capital investments and portfolio companies to the California Department of Financial Protection and Innovation (“DFPI”).

With registration commencing on March 1, 2026, we have summarized the key requirements below. Please contact your CFM attorney to confirm if your firm or specific funds are required to file.

Who Must Report

Broadly speaking, the report must be submitted to DFPI for each fund and SPV managed by an investment adviser where all three requirements are met:

1. The fund or SPV is a venture capital fund, a venture capital SPV, or a non-venture capital fund or SPV whose portfolio primarily consists of investments in private companies;
2. The applicable fund or SPV primarily engages in the business of investing in private companies (i.e., venture capital-style investment strategy); and
3. The fund or SPV has a California nexus (e.g., it is managed by personnel in California, it has invested in a California-based company, or it has solicited or raised capital from a California resident).

DFPI has provided additional information about which funds and SPVs must report here.

For many advisers, it will be easy to determine if all three requirements are met. For others, it may be unclear. Please contact your CFM attorney if you need assistance with this analysis.

What Must Be Reported

Eligible advisers must complete and submit a report about each fund and SPV that satisfies the requirements above. The report aggregates (i) information about the fund’s or SPV’s portfolio companies where the fund or SPV made an investment in 2025 and received or holds management rights with respect to the company and (ii) demographic data about the “founding team members” of those portfolio companies. The report template is available on the DFPI website here.

The underlined requirement is important – if the fund or SPV made a portfolio company investment in 2025 but does not hold management rights with respect to the company, the investment and portfolio company does not need to be included in the report. Management rights broadly mean a contractual right to substantially participate in or influence the operations of the portfolio company. Management rights are most commonly established through a right to appoint a director to the board of directors or a “management rights letter” entered into by the company and the fund or SPV.

To streamline this process, DFPI has prepared a survey that should be sent by an adviser to the applicable portfolio companies of its funds and SPVs. The survey should include a cover email that states (1) responding is voluntary, (2) there are no adverse consequences of declining to participate, and (3) responses will be aggregated and reported anonymously to DFPI.

When to Report

Commencing on March 1, 2026, eligible advisers can register for access to the reporting portal.

Once registration has been completed, the initial report must be submitted by April 1, 2026 and updated on an annual basis thereafter.

How to Report

Eligible advisers must complete two steps to submit the reports:

1. Register for access to the reporting portal on the DFPI website; and
2. Complete and submit the report for each applicable fund and SPV.

DFPI has provided a user guide to the reporting portal, which can be found here.

Action Items

STEP ONE – As an initial step, an adviser should:

1. Determine which of its funds and SPVs must submit a report (see Who Must Report above); and
2. With respect to those funds and SPVs, determine the portfolio companies that must be included in the report (see What Must Be Reported above).

STEP TWO – If an adviser is required to submit a report about one or more of its funds and SPVs, it should follow these steps:

1. Commencing on March 1, 2026, register for access to the reporting portal;
2. Send the survey to the applicable portfolio companies (see What Must Be Reported above);
3. Compile the responses and prepare the report; and
4. Submit the report to DFPI on the reporting portal by April 1, 2026.

For additional information, please reach out to partner Scott Kitchens, senior associate Jon Tong, or associate JJ Young.

ole-Frieman & Mallon LLP (CFM) is a leading investment management law firm known for providing top-tier, innovative, and collaborative legal solutions for complex financial services matters. Headquartered in San Francisco, CFM services start-up investment managers, multibillion-dollar funds, and everything in between. The firm provides a full suite of legal services to private funds and their managers across a diverse range of asset classes, including fund formation, regulatory compliance, counterparty documentation (digital and traditional prime brokerage, ISDA, repo, and vendor agreements), employment and compensation matters, and routine business matters.  CFM is particularly well known for its pioneering work with digital asset funds and their managers. The firm’s corporate and intellectual property (IP) practice groups advise founders, management teams, and investors during all stages of a business’s lifecycle including fundraising, M&A, governance, IP, employment, tax, and regulatory compliance for service and product launches. CFM also publishes the prominent Hedge Fund Law Blog. For more information, please add us on LinkedIn, follow us on X, and visit us at colefrieman.com.