Generative artificial intelligence (Gen AI) continues to chart new territories at an exhilarating pace. As private funds venture into the realm of Gen AI, they are confronted with a pivotal decision: how to grant access to their confidential information and intellectual property (IP) while maintaining appropriate protection. The art lies in striking a harmonious balance between fortifying proprietary data and unlocking the potential of Gen AI. Not all Gen AI undertakings call for jeopardizing valuable information; the range of necessary inputs depends on the task, purpose and desired output. This second article in a two‑part guest series by Akin attorneys Michael P. Kahn and Ryan Dowell explores the challenges and considerations private funds face when integrating Gen AI into their operations, focusing on safeguarding proprietary fund data and IP. It provides insights into the risks associated with using Gen AI, different potential forms of Gen AI deployment and best practices to protect sensitive information. The first article highlighted the evolving regulatory landscape concerning Gen AI and the customization of Gen AI models and their potential applications to private funds. See “Designing a State-of-the-Art Private Fund Compliance Department: Leveraging Cutting-Edge Technology” (Sep. 21, 2023).