Monday, 28 July 2014
Last updated 1 hour ago
Feb 24 2011 | 10:41am ET
The son of U.S. Senator Ron Wyden has launched a hedge fund—from his father's basement in Washington, D.C.
Adam Wyden, a self-described "serial entrepreneur" and former paid intern at hedge fund D.E. Shaw Group, filed a private placement notice for his ADW Capital Partners with the Securities and Exchange Commission last month. The fund, which features exactly one employee at the month, is currently managing $3 million.
"I am the CEO, I am the secretary and I am the chief marketing officer," the younger Wyden told Bloomberg News.
Wyden said he launched the hedge fund in September, shortly after receiving his M.B.A. from Columbia Business School. The senator's son, 26, served as an intern at D.E. Shaw in 2005, while he was completing his undergraduate degree at the University of Pennsylvania's Wharton School, working on the firm's media, technology and telecommunications portfolio.
His former boss at D.E. Shaw, Brian Marshall, gave Bloomberg a quote that Wyden will no doubt want to provide to potential investors: "Not many college kids get to intern on a D.E. Shaw portfolio for the summer," he said.
And D.E. Shaw said that internship had nothing to do with politics. While firm founder David Shaw is a long-time donor to Wyden, an Oregon Democrat, "Adam went through the same rigorous vetting and interview process as all other D.E. Shaw Group interns," a spokeswoman for the firm told Bloomberg.
The new fund certainly isn't seeking to lower the bar in terms of expectations: ADW is modeled on Buffett Partnership, the investment firm headed by Warren Buffett before he bought Berkshire Hathaway. It will invest in smaller, under-covered stocks in the U.S., Canada and Western Europe employing a "conservative" strategy, Wyden said.
ADW charges 2% for management and 20% for performance. One person who won't be paying those standard rates—or any others—is Wyden's father, the senator. Ron Wyden is not an investor in ADW.
"I just want my kid to be happy," Wyden told Bloomberg. "If this is the career he wants, I am all for it."
Wyden isn't the first senator to have a hedge fund manager in the house, but he certainly hopes it causes him less grief that it did his former colleague, now-Vice President Joseph Biden. Biden, a senator from Delaware for decades before his elevation to the vice presidency, had to deal with the headache of a legal battle over a fund of hedge funds run by his son and brother during his campaign for vice president.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…