Aethra Shuts Down Amidst Fundraising Woes

Sep 7 2011 | 12:29pm ET

Aethra Asset Management has liquidated its hedge funds after failing to reach critical mass in assets under management.

The Dutch- and London-based firm, founded by two former ABN Amro bankers three years ago, blamed a "chicken and egg situation" for its woes: Investors expressed interest in the firm but backed off due to its small size, preventing it from obtaining the assets it needed to attract such investors.

"We got through rounds of due diligence, but every time we found that in the end the client didn't invest because the funds were too small," co-founded Daan Potjer told Financial News. "We had all the measures in place that you would want—we were a financed company, we only invested in very liquid assets, we offered daily liquidity for all the funds."

"This market is not conducive to starting a company," Potjer complained. "It is a pity because for the future the market needs new funds."

Aethra's three funds have been liquidated and assets have been returned to investors. Potjer and co-founder Marc Vernooij are now in the process of winding down the firm.

Aethra had a total of nine employees, all of whom joined from ABN Amro. All are now looking for work, except for Matthias Scheiber, a fund manager, who joined Schroders this week.

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