The Cayman Islands Monetary Authority’s (CIMA) updated AML rules, which came into force on 18 September 2026, place greater focus on the requirement for Cayman private funds to undertake independent AML audits.

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Langham Hall can undertake these audits for eligible Cayman private funds, complementing the fund administration and AML services we already provide.

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A coordinated approach to your AML audit

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An independent AML audit should provide the fund’s governing body with an objective assessment of whether its AML framework, policies, procedures and controls are appropriate and operating effectively. Our review is tailored to each fund’s circumstances and risk profile.

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For existing clients, our teams can coordinate efficiently on administrative matters and the provision of relevant information.

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How independence is maintained

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CIMA permits an independent AML audit to be performed by an internal audit function, provided sufficient independence is demonstrated. Where Langham Hall already provides services to a fund, our audit approach has been structured with safeguards designed to preserve the objectivity of the review. In particular:

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• Separate audit function: The audit will be led and conducted by personnel who are separate from the teams responsible for investor onboarding and day-to-day AML compliance activities, and who have not been involved in the design, operation, management or oversight of the AML controls being reviewed (the “Audit Team”).
• No financial or governance interest: Langham Hall and the Audit Team do not hold a directorship, ownership interest or control in the fund.
• Independent reporting: The Audit Team communicates its findings directly to the fund’s governing body, without requiring prior notification, discussion or approval from the teams responsible for day-to-day compliance activities.

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The audit is overseen by a CPA with extensive Cayman private fund industry experience, who undertakes Cayman AML training regularly and keeps abreast of AML, CFT, CPF and CIMA regulatory developments.

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How Langham Hall can help

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Our audit covers relevant areas of the fund’s AML framework and internal governance, with findings and practical recommendations for consideration by the fund’s governing body.

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To discuss the applicability of the requirements to your fund, the anticipated timeline, audit scope and fees, please contact aml.asia@langhamhall.com.

Langham Hall is pleased to announce that it has supported Ryse on the launch of its independent sponsor platform. Ryse invests on a deal-by-deal basis in established companies aligned with Europe’s structural growth themes.

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Founded by Max-Otto Griesam and Martin Vieider, Ryse is a European-based independent sponsor built on a long-term ownership approach. Its focus is on businesses with strong technology and loyal customers and it works closely with management teams to support their growth. A central theme of the strategy is the move of AI into the physical world, an area where Ryse believes Europe’s engineering talent, Mittelstand companies and industrial know-how give it a strong position to lead.

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Ryse’s first two investments are deZem, an energy data and software business based in Berlin, and Volue, the Norwegian energy technology company.

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The founders bring extensive private equity and operating experience. Both previously worked at Advent International; Martin went on to serve as CEO of Volue and Max co-founded Hestia and Treysta.

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Langham Hall is providing administration services for each of the deal-by-deal structures from its Luxembourg office.

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Tom Pinnell, Head of Commercial, Langham Hall, commented: “Ryse brings together deep private equity and operating experience with a clear, long-term vision for European businesses. The independent sponsor model gives the team flexibility in how it invests and our Luxembourg team is delighted to provide the operational support that allows them to focus on working with their portfolio companies. We look forward to supporting Ryse as the platform grows.”

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Martin Vieider, Co-Founder, Ryse, commented: “Max-Otto and I have talked about building something together for most of the 17 years we’ve known each other, and launching Ryse is the realisation of that ambition. Langham Hall has given us a strong operational foundation from our very first transactions and we are pleased to have them alongside us as we build momentum, company by company.”

Langham Hall is pleased to bring you the latest episode of First Close, in which Tom Pinnell, Head of Commercial, Europe, sits down with emerging private equity managers and those who work alongside them for an honest look at what it takes to build an investment firm from scratch.

In this episode, Tom is joined by Miles Otway, Co-founder of Ama Capital. Miles has spent his career in the UK lower mid-market, including over 11 years as a Partner and Head of New Business at Connection Capital. In late 2024, he co-founded Ama Capital, an independent sponsor platform built on a simple idea: operating partners should not sit on the sidelines, but should be co-owners integral to the firm's strategy. Ama Capital backs UK businesses in the lower mid-market and has already completed its first two transactions.

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They discuss:

• How bringing operating partners inside the GP changes decision-making, not just delivery
• What happens when a great business and an experienced operator do not fit
• Deal-by-deal capital versus building towards a fund, and why that is a business decision as much as a funding one
• The shift from backing individual deals to building an investment firm
• What success looks like for Ama Capital

Available on Spotify, Apple Podcasts and all major platforms.

Listen to Episode 5

Lift-outs are being considered more often by European private markets managers seeking to preserve in-house knowledge while reducing the cost and complexity of operational infrastructure, technology and oversight.

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Why managers consider a lift-out

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A lift-out can offer a practical middle ground between retaining a valued team and modernising the operating model. Potential benefits include:

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• Preserving fund, investor and asset knowledge within the transition
• Accessing more scalable technology, reporting and control infrastructure
• Reducing management time spent on operational administration
• Creating an opportunity to improve data quality and process discipline

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Key discussion point: data and records

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The condition of historical records is often the first practical test. NAV histories, investor registers, entity data and reporting outputs need to be reconciled and mapped before the new operating model can be relied upon.

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For many managers, the transition is therefore not only a transfer exercise but also a chance to clarify ownership of data, remove workarounds and agree what “good” looks like for future reporting and oversight.

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Regulatory considerations in Luxembourg

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Where Luxembourg-regulated structures are involved, regulatory planning should be part of the initial discussion rather than a later workstream.

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• ‍Outsourcing (CSSF Circular 22/806): Responsibility remains with the supervised entity even where activities are delegated. Oversight obligations do not transfer with the team.‍
• UCI administration (CSSF Circular 22/811): Depending on the nature of the change, prior CSSF authorisation may be required before implementation.‍
• Operational resilience (DORA): Data migration, access management and ICT controls are now part of the regulatory assessment, not simply operational considerations.

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The practical question is how these requirements affect sequencing, approvals, governance and the timing of any migration or service change.

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Questions for discussion

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Before deciding whether a lift-out is the right route, managers may want to test the case against a few core questions:

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• What benefits are being targeted: cost, control, resilience, scalability or all of these?
• Which knowledge must be retained, documented or transferred?
• Is the data sufficiently complete and consistent to support migration?
• Which regulatory approvals, notifications or governance steps are required?
• How will continuity for investors and internal stakeholders be maintained?

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Taken together, these considerations mean that a lift-out is best viewed as an operating model discussion rather than simply a staffing or outsourcing decision. Whatever the eventual structure, the fundamentals of effective fund administration remain the same: reliable data, appropriate controls, clear governance and an operating platform capable of supporting future growth.

A compelling investment strategy will not necessarily earn a place in an investor's portfolio.

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For managers raising capital, particularly those building an early fund, that can be an uncomfortable lesson. A strategy may be differentiated and the return opportunity attractive, but investors are assessing it in the context of portfolios, liabilities and constraints that already exist.

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For Shinobu Miyata, Head of Japan at Langham Hall, this is where what he terms “Spectrum Match” begins. In Japan, as across private markets globally, he argues that managers need to understand two spectrums: where an investor sits, and where the asset class sits. The opportunity lies in understanding where the two can align.

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Investor depth is structural

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As Shinobu puts it: “Investors exist on a spectrum defined by liabilities, purpose, and constraints.” An investor requiring liquidity and flexibility occupies a very different position from a pension fund or insurer investing against liabilities extending decades into the future. Other investors may be seeking more than financial return, placing value on strategic alignment, access to information or wider business relationships.

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In Shinobu's framework, these differences are structural. Liability horizons, objectives and constraints determine an investor's “depth” and, in turn, what they need an investment to contribute to the wider portfolio.

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Asset classes have depth too

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For investors, public and private markets are not two separate worlds. They form a continuous spectrum, from liquid and transparent listed markets through to deeper private-market strategies.

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Shinobu defines that depth principally through two characteristics: liquidity and information asymmetry. At the shallower end, information is widely available and capital can move relatively freely. Further down the spectrum, liquidity falls, capital is committed for longer and information becomes less evenly distributed.

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This matters because the nature of the return opportunity changes too. In venture capital, growth equity, buyout and private credit, access, specialist knowledge and information can play a much greater role. In Shinobu's framework, information asymmetry is not simply a characteristic of these deeper markets; it can itself become a source of return.

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Put the two spectrums side by side and the matching logic becomes clearer. Investors with long-term liabilities and institutional mandates, such as pension funds and insurers, sit deeper on the investor spectrum and may be better placed to allocate to less liquid, longer-duration assets. Investors requiring greater flexibility sit towards the shallower end. But the match is not always like for like: entrepreneurial and corporate investors may choose to go deeper where access, information or strategic value matters alongside financial return.

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Finding the missing piece

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This is where Shinobu's analogy of the investor's portfolio as a “shelf” becomes useful. As he writes: “The question is not ‘Is our strategy great?’ The question is: ‘Which depth of the investor’s shelf is missing a piece, and what kind of risk–return “spice” can we place there?’”

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A decision not to allocate does not necessarily mean an investor considers a strategy unattractive. The strategy may simply offer the wrong combination of liquidity, risk, return or exposure for that investor at that point in time.

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For managers, the task is to identify the risk–return profile that is missing from the investor's portfolio and be clear about where they have a genuine advantage: which stage or domain they understand, where information asymmetry exists and how they are equipped to exploit it.

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Only then do questions of structure come in. Vehicle design, jurisdiction, governance and operations all matter, particularly where investors and managers operate across different markets. But those decisions should follow the investment and investor logic, rather than substitute for it.

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Designing from the investor backwards

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There is no universally “best” fund proposition in isolation. What works for one investor group, market or strategy may not translate neatly to another.

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Understanding the investor is more than a fundraising exercise. It shapes the proposition itself. As Shinobu concludes, Spectrum Match is about “matching depth with depth, and designing for the exact context in which capital makes decisions.” A good strategy still matters. The harder question is whether it fills a gap the investor actually has.

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This article draws on Shinobu Miyata's Spectrum Match analysis. Read the full article on Slow Steps Episode 7: Redesigning the Performance Standard: Slowsteps Inc.

At Langham Hall, we invest in hiring and developing junior talent across our global offices. Our internships offer real responsibility, meaningful client exposure and direct access to experienced professionals, giving students a foundation that extends well beyond funds.

Waka Fujiwara, an engineering student at the University of Edinburgh, joined our Tokyo office this summer as a business development intern, working alongside interns from Senshu University.

"Waka was new to the funds industry, but she worked hard to build her knowledge so she could add real value to our business development activity," said Shinobu Miyata, Head of Japan. We spoke to Waka about daily life in the Tokyo office, the support she received and her introduction to the world of fund administration.

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A day in the Tokyo office

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Each day began with a short check-in with Shinobu to set priorities. The first two weeks focused on building her knowledge of the industry through core daily tasks. From there, Waka moved into coordinating with fellow interns on company initiatives, from event planning and scheduling to drafting promotional materials.

Client exposure came early. Waka joined weekly client meetings, gaining a first-hand view of how the business works and the issues that matter most to the managers Langham Hall supports.

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Mentorship as standard

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What surprised Waka most was the investment in mentorship. "I didn't expect a financial services firm to put so much effort into developing future leaders at intern level," she said. "It changed my expectations of what mentorship can look like in a demanding industry."

In practice, that meant being treated as part of the team from the start. "Shinobu was always willing to answer questions, even small ones, so I could ask directly rather than spend hours working through tasks alone,” she said. “That openness made the learning curve much smoother. He clearly valued giving young people the chance to contribute and welcomed our input as part of growing the business."

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Where finance meets engineering

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Researching real asset investment, from green infrastructure to aviation, gave Waka a new perspective on her own field. "Advanced engineering projects depend on institutional capital," she explained. "Seeing investment in real assets, from cross-border renewable projects to modern aircraft fleets, made it clear that technical innovation needs a strong financial framework behind it. Understanding the administration side showed me how much structure sits behind large-scale projects."

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Advice for future applicants

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For students weighing up an internship with Langham Hall, Waka's advice is simple: do not rule out the unfamiliar. "Most students have never heard of fund administration, let alone considered it as a career. That's exactly why it's worth exploring. This isn't just work experience; it's immersion in a whole new industry and you come out with a much broader view of what a career in finance can be."

It is a view Shinobu shares. "We really enjoyed seeing how quickly Waka learned and the genuine interest she took in our business," he said. "That curiosity is exactly what we look for in the next generation of talent."

Langham Hall is pleased to announce that it has supported Northcote Equity in the successful first and final close of its second fund, Northcote Fund II LP (“Fund II”), at its hard cap of £250 million. The close comes less than two years after Northcote Equity's debut fund, Northcote Fund I, reached its hard cap of £160 million.

As with its first fund, Fund II will invest in founder-owned businesses in the lower mid-market across the UK and Ireland, with a focus on the technology and business services sectors. The fund will target equity investments of between £10 million and £40 million per transaction, taking both majority and minority positions.

Founded in 2025 by Matthew Charman, Scott Fairlie and Charles Dale, Northcote Equity brings together a team with a decade of shared experience. Fund II has attracted capital from leading institutional investors, including university endowments and family offices across the US and Europe.  Alongside a handful of new LPs, Fund I investors have committed more than 100% of their Fund I capital to Fund II, reflecting their confidence in Northcote’s progress.

Langham Hall has supported Northcote Equity since launch and continues to provide fund administration and accounting services from its Guernsey office, together with appointed representative services from its London office.

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Bronwyn Alexander, Client Director at Langham Hall, said: "Closing a second fund to support a high-quality and active pipeline less than two years after a successful maiden fundraise is a remarkable achievement. We are delighted to have supported Northcote Equity across both Fund I and Fund II, and we look forward to continuing the partnership as the firm builds on these two successful closes."

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Matthew Charman, Co-Founder at Northcote Equity, said: "Reaching a first and final close of Fund II with both existing and new investors is a strong endorsement of our strategy and our team. Langham Hall has been a trusted partner since our launch and their support across both funds has allowed us to focus on what matters most, backing exceptional founder-owned businesses across the UK and Ireland."

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Northcote was also advised by Acanthus Capital, Ashurst Perkins Coie and Carey Olsen.

Langham Hall continues to support many high-profile spinouts, including PX3, bd-capital, Hypha, Atlas Health, Clipway and Goldenpeak.

Meet some of the experienced practitioners bringing specialist knowledge, judgment and direct client support to Langham Hall's US business.

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Staying close to the work

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At industry events, Joe Watson is often taken for a business development professional. His answer is straightforward.

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“I take that as a compliment. I'm close to the work itself, which is why I can still speak to the issues clients, fund counsel and other industry professionals are actually working through.”

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The questions he is asked at those events are the same ones clients bring to the team once the work begins: how structure and strategy determine a fund's basis of accounting, how certain LPA provisions translate into the underlying calculations, or how other managers have approached something similar.

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Watson, a Director in the US team, began his career in real estate audit before moving client-side into financial reporting at a fund manager. That experience eventually led him into fund administration, where he is able to work across multiple clients year-round rather than within a set engagement period. Each of those vantage points is useful in a different way, but his audit background is one clients regularly draw on.

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"Staying close to the work is what lets us add real value, not just for our clients but for the industry professionals we work with as well."

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Working through the accounting questions

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Clients can be wary of an audit, but Watson's experience means he understands what the auditor is trying to establish. “An auditor's objective isn't to find fault; it's to gather sufficient evidence that the numbers comply with the relevant standards and reach an opinion from there.” Knowing how to work through those issues changes the nature of the conversation.

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Several senior members of the US team have audit backgrounds, which makes them well suited to work through what the basis of accounting should be, which valuation methods are available and where the legal provisions and accounting treatment leave room for interpretation.

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“The value is often in helping our clients connect the accounting, the audit process and the fund documents, and explain how those pieces work together in practice.”

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That same dynamic shows up in the waterfall training Watson leads for lawyers in the industry. Fund counsel draft the provisions but do not always see how they resolve mathematically, while the accountants applying them do not always interpret the drafting the same way. Working through real examples together helps to close that gap before the language is finalized.

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Drawing on more than one client

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Fund managers who have not used an administrator before often ask Watson a version of the same question: “What do you do for your other clients?” It is a fair question, particularly for a manager whose finance team has a narrower frame of reference.

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“A single finance team only knows what it's experienced directly. We've experienced it across the full spectrum of clients and structures we serve.”

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When a client raises a question, Watson and the team can bring it to the broader management group, where several colleagues may have encountered a similar issue across another fund, structure or client situation. In some cases, that perspective points to a clear response; in other cases, the team will work through the facts together before going back to the client.

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The responses come back from professionals running diverse funds and structures. As a result, the client benefits from the accumulated expertise of a wider group rather than relying on the knowledge of a single individual.

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Answering in real time

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Allen Feng, also a Director in the US team, has worked in fund administration since 2013. For him, knowledge is only valuable to a client if it is available when the question arises.

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With the US team based in New York and Philadelphia, client questions can be addressed seamlessly throughout the working day, without delays that can come from multiple time zones or layers of handoffs.

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“We operate as a true extension of a client's organization rather than a third-party entity. We service them with real-time experience and insight.”

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This responsiveness matters most when an investor request is urgent. If an LP requests inception-to-date capital activity that the fund manager cannot readily extract, the answer has to come from the administrator quickly enough to be useful.

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Advanced systems expand what can be produced on demand. Understanding what the investor is actually asking for still relies on the expertise of the people reviewing the request.

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Taking ownership of the problem

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For Jeff Kendall, a Manager in the US team, the test comes when a client request falls outside standard reporting requirements.

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A recent engagement brought this to life. A real estate client preparing to launch a new fund needed tailored performance metrics that went beyond its standard reporting, on a compressed timetable. The team worked through the underlying data, aligned on the methodology and delivered a refined set of metrics the client could use with confidence in its investor marketing materials.

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Looking ahead to the next decade, Kendall expects fund managers to ask for more than operational delivery.

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“Clients will increasingly prioritize scalability, transparency and strategic partnership.”

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Data integrity will sit closer to the center of the client experience, alongside informed guidance on system selection and data architecture.

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Those capabilities will matter even more over the next ten years than they did over the last. They should extend what experienced people can do, rather than put greater distance between them and the client.

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The person a manager meets at an industry event is the person who reads the LPA afterward.

Fund waterfalls can look like a calculation problem, yet the calculation is really the end of the story. Before any numbers are run, decisions have already been made about when performance should be recognised, when a manager should participate in profits and how the economics of success should be shared between a GP and its LPs.

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For Shinobu Miyata, Head of Japan at Langham Hall, this is what makes waterfalls interesting. Their mechanics may be mathematical, but their origins are not. The structures used across private markets today have been shaped by decades of negotiation between investment managers and the investors whose capital they manage.

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Seen in that light, a waterfall is more than a method of distributing proceeds. It is a record of how the market has tried to reconcile two sets of interests.

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Behind the calculation is a judgement

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Take one of the classic questions in waterfall design: deal-by-deal or whole fund?

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Imagine a fund with ten investments, five of which perform exceptionally well and five of which lose money. Under a deal-by-deal waterfall, the GP may participate in the profits from successful investments before the rest of the portfolio has been realised.

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The manager can reasonably argue that value has been created and should be recognised. The investor can equally ask what happens if gains on those investments are subsequently offset by losses elsewhere in the fund. Neither view is unreasonable; each simply approaches performance from a different starting point.

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Whole-fund waterfalls assess returns at fund level. Investors generally receive their contributed capital and any preferred return before carried interest is paid. Adjusted deal-by-deal and other hybrid structures have developed in response to the tension between the two positions. This is why Shinobu describes a waterfall as “an incentive design mechanism” rather than a profit allocation formula.

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Why the template is only the beginning

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The same history sits behind many of the provisions that now appear routinely in fund documentation. Carried interest, hurdle rates, catch-ups and the choice between deal-by-deal and whole-fund structures can easily appear to be established features of the market. They did not arrive there by accident. Each reflects arguments about economics, incentives and what different generations of GPs and LPs considered fair.

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This has particular resonance in Japan, where template LPAs are sometimes treated as the correct answer. Shinobu regards them differently: “Template LPAs are not answers. They are historical records.”

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A familiar provision tells us where market practice has arrived; it does not, by itself, explain why that provision is appropriate for a particular fund. The more revealing questions lie underneath. What problem was this term intended to solve? Whose interests does it protect? What behaviour does it encourage? And does that reasoning make sense for this strategy and these investors?

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What sits behind the hurdle?

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An 8% hurdle rate is common in private markets and Shinobu’s instinct is to ask why.

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Market convention is one answer, but it says little about the economics. Once capital has been called, it is tied up in the fund until it is distributed rather than being available for deployment elsewhere. Listed equities, real estate and other private funds all compete, in different ways, for that capital.

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Strategies and asset classes vary, and there is no single correct hurdle rate. Shinobu does, however, pause when he sees a 0% hurdle. Investors can hold government bonds, investment-grade credit or an index fund, each offering an expected return. If they are being asked to commit capital for a decade with no minimum return before the manager participates in profits, that choice warrants scrutiny.

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What matters is whether the chosen terms have a rationale that can be explained to investors. Framed that way, a technical negotiation over a percentage becomes a broader conversation about the opportunity cost of capital, the nature of the strategy and the basis on which a GP and its LPs share in the fund's success.

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When the LPA meets real cash flows

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Another side of waterfalls becomes visible once a fund is operating. The LPA may set out the agreed economics, but real cash flows rarely arrive in a neat sequence. Capital is called and investments are realised at different points in the fund's life. Distributions may be partial, while preferred returns accrue and, depending on the terms, may compound. At that point, timing matters.

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Shinobu recently reviewed a case in which intuition pointed to one outcome and the mathematics to another. Anyone responsible for putting waterfall provisions into practice will recognise the problem: terms that appear straightforward on the page can produce unexpected results when applied across a series of actual cash flows.

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This is where a fund administrator brings something different to the conversation. Its role is not to decide what is fair between the GP and its LPs. Its perspective comes from turning the commercial bargain into a calculation and applying it consistently over the life of the fund.

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If the intended economics cannot be translated clearly into the mechanics of the waterfall, ambiguity can remain hidden until there is real money to distribute. For a GP, that argues for testing the waterfall against realistic cash-flow scenarios while the LPA is still being negotiated, rather than discovering its behaviour when the first proceeds arrive.

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From negotiated principle to economic outcome

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A waterfall sits at an unusual intersection: it begins with a commercial negotiation, is expressed through legal drafting and ultimately becomes mathematics. All three need to tell the same story.

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Understanding a waterfall therefore means looking beyond the formula. A template shows how others have approached the question and market convention provides a reference point, but neither removes the need to examine the reasoning behind the terms or to consider them against the wider opportunity set available to investors.

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For Shinobu, the evolution of waterfalls reflects successive attempts by GPs and LPs to recognise performance, account for the cost of capital and agree how the rewards of successful investment should be shared. The final calculation is where all of those choices become real.

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The question, then, is not simply whether the waterfall has been calculated correctly. It is whether the calculation gives effect to the economic relationship that the GP and its LPs intended to create.

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This article draws on Shinobu Miyata’s Slowsteps article and podcast episode: Episode 9 - Why Waterfalls Exist