Fund Formation Work Rose in 2026: Ahead of a Flat Funds Practice

Fund formation law firms had a busier year than the practice they sit in. Sartori & Partners data show 606 dated fund formation deals in the 12 months to October 2026, for 432 distinct clients. On settled 12-month windows the count rose 23.0%, while the funds and investment management practice's whole deal record held flat (+2.8%). Fund formation is the single largest deal type inside that practice. Lateral partner hiring in funds rose 29.7% over the same kind of window. For a firm deciding where to add a funds partner, the formation desk is where the work is growing.

The settled windows tell the story. Dated fund formations went from 505 in the 12 months to September 2025 to 621 in the 12 months to September 2026: the deal type rose 23.0%. The funds practice's full deal record, every matter its lawyers are credited on, moved from 1,191 to 1,224 and held flat (+2.8%). All dated deals rose 10.6% over the same windows, from 43,590 to 48,216.

The two records overlap heavily. Funds lawyers are credited on 78.9% of all fund formations, and private equity lawyers on 4.5%. Seen from the other side, fund formation sits at 39.1% of the funds practice's deals, ahead of M&A at 9.8% and capital markets at 5.7%.

Deal counts here are matters on record, not fees, and a deal can carry more than one type, so the shares in the table are read one by one and never added. What they show is where the practice spends its deal time: on raising and structuring funds before any other kind of mandate. A funds group whose partners mostly handle fund-side M&A or listed vehicles is working the part of the record that held level, not the part that grew.

Firms have been adding senior funds lawyers. In the Sartori & Partners lateral records, partner moves into the funds practice went from 165 in the 12 months to September 2025 to 214 in the 12 months to September 2026, so partner hiring rose 29.7%. Lateral hiring at every level rose 23.7% on the same windows, from 507 to 627 moves.

The hires lean senior and land in a few cities. Partners were 36.7% of the 594 funds lateral moves in the 12 months to October 2026. New York took 27.1% of them, an index of 183 against the market, and London 15.2%, an index of 165. Luxembourg, the domicile for many European funds, carries an index of 1,065 on a small count.

Funds candidates also cross practice lines. Of the funds lateral moves, 26.6% also carried private equity and 12.0% carried tax, the two disciplines a fund launch leans on most.

Rising formation work and rising partner hiring point the same way, which makes the search harder, not easier. A formation partner with sponsor relationships is being courted while that partner's own deal flow is climbing, and such lawyers seldom move for a lateral offer alone. Expect to show a platform that can take on more launches, not just a higher draw.

Fund formation has a different client base from the practice around it. Financial sponsors are the client on 57.3% of fund formations, against 29.3% of all funds practice deals and 6.9% of all dated deals. Asset managers sit on 31.8% of fund formations, against 64.3% of funds practice deals.

A deal can carry more than one client sector and some carry none, so the two shares stand side by side and are not added. The pattern is still plain: private equity and private credit houses raising closed-end vehicles drive formation, while asset managers with open-ended and registered products bring most of the wider funds work.

That shapes the hire. A partner who built a book on registered funds for asset managers will not bring the sponsor launches that are growing. Ask formation candidates which sponsors they have taken to a final close in the last two fundraising cycles, and weigh that above the size of their total funds practice.

Kirkland & Ellis ranks first by fund formations advised, in the 101-150 band. The next firm, Ropes & Gray, sits in the 21-40 band, with Simpson Thacher & Bartlett, Latham & Watkins and Maples Group beside it. Places six to ten are all in the 11-20 band. On the funds practice's full deal list the picture is closer: Kirkland & Ellis and Dechert share the 101-150 band.

Five firms appear in the top 10 of both lists: Kirkland & Ellis, Ropes & Gray, Simpson Thacher & Bartlett, Latham & Watkins and Loyens & Loeff. The partner hiring is happening mostly elsewhere. Of the ten fund formation advisers above, only Proskauer Rose also ranks in the top 10 of funds lateral partner hirers, where it sits 7th.

Below the first place, formation volume is spread across firms in close bands, and the firms adding funds partners are mostly not the ones at the top of the formation list. That leaves room for a firm outside the ten to build a formation desk by hiring, and it means the established advisers will face offers aimed at their partners.

Where a fund size is published, the median fund formation is $1,100 million. Sizes are on record for 48.8% of fund formations, against 25.1% of all funds practice deals, so the formation median rests on a wider base than the practice figure. M&A deals that disclose a price sit at a median of $1,200 million and private equity deals at $2,050 million.

Read the median with care. The funds that announce a size at final close tend to be the larger ones, so the figure describes the published end of the record. Still, a median of $1,100 million says that formation work at the firms on record is mostly institutional fundraising, with investor negotiations, side letters and tax structuring to match.

Large launches need depth below the partner: counsel and associates who can run dozens of investor side letters at once, and tax and regulatory lawyers on call. A partner hire without that support caps the size of fund the desk can take.

Hire for the formation desk, not for funds in general. Fund formation rose 23.0% while the practice's whole record held flat (+2.8%), so a candidate's share of formation work matters more than the total size of their funds book.

Follow the sponsor. Financial sponsors are the client on 57.3% of fund formations; a partner whose clients are mostly asset managers serves a different, steadier part of the market.

Move now and budget for a longer search. Funds partner hiring rose 29.7% on settled windows, and Sartori & Partners figures show the firms adding partners are largely not the firms that advise on most formations. Rivals are building, and the formation partners worth hiring are busy.

Plan the team, not only the partner. With a median published fund of $1,100 million, a formation partner brings work that needs tax, regulatory and associate support from the first launch.