The ability of a fund manager or an entrepreneur to raise capital for their fund or company can be a critical component for the success of their venture. Fundraising can be quite challenging, so it is not surprising that those who are out raising funds will look favorably at friends, family members and business contacts who offer to bring investors to the table. These friends, family members and business contacts are seldom registered with the Securities and Exchange Commission (“SEC”) as broker-dealers and are generally referred to as “finders.” While the use of finders may be embraced as a smart supplement to other fundraising efforts of the fund manager or entrepreneur, a note of caution should be sounded. As discussed below, with very limited exceptions, the activities of a finder ordinarily would require the finder to be registered as a broker-dealer, and the consequences for failing to have the required registration can be severe, both for the unregistered finder and for the fund or company that engages them.