In A First, Maverick Seeds Long/Short Value Shop

Apr 18 2012 | 12:15pm ET

Another prominent hedge fund has gone into the seeding business.

Maverick Capital Management has made its first two seed investments in start-up hedge funds, the first beneficiary said. Sycamore Lane Partners, a long/short value specialist, told clients that Maverick had made "significant capital contributions with extended lock through 2015," although it did not specify exactly how much the $9 billion hedge fund had invested.

According to a regulatory filing last year, Maverick set up a $22 million seeding pool. The firm has seeded another hedge fund in addition to Sycamore Lane, although its identity is not known, Dow Jones Newswires reports.

Both of the funds are now up-and-running; Sycamore said that Maverick's seed allowed it to begin trading on April 2. "While neither Maverick nor its affiliates will be active in the management of the day-to-day business of the Sycamore Lane funds, Maverick will be in a position to provide strategic advice on the development of Sycamore Lane's internal operations and infrastructure," Sycamore Lane said.

Unlike Tiger Management's Julian Robertson, Maverick does not appear to be seeking out "cubs" to seed: Sycamore Lane founders James D'Angelo and Cregg Watner are not Maverick veterans. Instead, both were senior analysts at Elm Ridge Capital, with D'Angelo focusing on consumer and industrial stocks and Watner on technology and healthcare. D'Angelo also formerly worked at SAC Capital Advisors.

Sycamore Lane aims to have a long book of between 20 and 30 names and a short book of between 30 and 50 names. The latter will focus on stocks with liquidity issues, aggressive accounting or poor capital allocation.


In Depth

Q&A: TCA Fund Management's Bob Press on Small-Cap Private Equity

Aug 25 2016 | 8:55pm ET

The emergence of private credit as a replacement for traditional bank financing...

Lifestyle

Kiawah: Island Reversal

Aug 24 2016 | 9:59pm ET

Looking for real estate investments but the typical real estate fare isn’t cutting...

Guest Contributor

Old Hill Partners: Embrace Illiquidity

Aug 9 2016 | 2:39pm ET

The age-old financial concept that higher yields are the result of higher risk and...