Hedge Fund Seed Investors
Seed Investors Resume Funding of Hedge Fund Start-Ups
Smaller hedge funds and hedge fund start-ups have had trouble finding seed investors over the last few years. Now, it seems that seed investors are ready to start committing capital to start-ups and small hedge funds again.
Patric de Gentile-Williams, chief operating officer of hedge fund seeding specialist FRM, said his portfolios have raised a net $70 million (£47.8 million) so far this year -- after raising "very little" in 2009 -- and he expects further commitments.
Total assets stand at about $360 million.
"Investors are allocating to this space," he said in an interview on the sidelines of the GAIM hedge fund conference here. "We're seeing the most sophisticated investors look at this space.
"It (the $70 million) is the first part of what we expect to be a series of capital raisings. It's a very strong pipeline. Conversations will, I think, lead somewhere, whereas last year conversations were about maintenance of (relationships)."
Investors were happy to back start-up or small-scale hedge funds during the industry's pre-credit crisis boom -- when high-earning traders would leave a bank and set up on their own -- in the hope of unearthing a talented manager. Source
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