Hedge Funds Recruiting Failed Startup Founders
If it seems like a startup hedge fund closes every day, they don’t. They’re closing at a much faster rate than that. What’s left are career casualties: smart, rich hedge fund managers who, for whatever reason, couldn’t cut it on their own. Don’t feel too bad though. Failed startup hedge fund managers are at the top of the list when it comes to recruiting.
Large hedge funds like Marshall Wace, Millennium Management, CQS and BlueCrest Capital Management are swallowing up portfolio managers that were forced to shutter their own shop, according to Financial News. Failing to succeed on your own is no longer looked at as a red flag in the eyes of larger shops due to the number of obstacles facing smaller shops, including increased regulation and a less-than-hospitable fund raising environment.
Marshall Wace, for example, plans to hire around a dozen investment staffers over the next few years as it moves its offices from Connecticut to New York. One Marshall Wace staffer told Financial News that it plans on taking advantage of the growing talent pool of portfolio managers who tried and failed to set up their own fund.
The startup environment has gotten so tough, many aspiring teams of portfolio managers are scrapping plans to launch their own firm, choosing instead to join a large company and establish a platform fund.
As we mentioned last week, long/short funds are where you want to be, at least in the current volatile economic climate. Activist hedge funds are doing well in their own right.
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