There are various reasons – such as tax issues, regulatory concerns or LP control – why fund managers decide to launch supplemental funds in parallel with their flagship funds. The problem, however, is that fund managers may focus so intently on curing those issues that they overlook some of the potential conflicts of interest introduced by operating parallel funds. In addition, fund managers may occasionally develop blind spots for when multiple funds operate with sufficiently similar investment strategies to qualify as parallel funds and necessitate careful treatment. To bolster industry best practices in this area, the Standards Board for Alternative Investments (SBAI) recently issued a case study (Case Study) focusing on those issues and providing information on the other resources available through SBAI. This first article in a two-part series discusses the key takeaways from the Case Study, with added insights from SBAI executive director Thomas Deinet and relevant industry practitioners on the topic. The second article will outline different contexts in the PE, private credit and real estate sectors in which parallel funds can arise and provide tips for mitigating those risks. For more on addressing parallel funds in side letters, see “Current Scope of PE‑Specific Side Letter Provisions: Co‑Investment Rights, LP Advisory Committee Seats and Parallel Funds/AIVs (Part Two of Three)” (Mar. 26, 2019).