Incubation Exit Strats: Consolidation Comes Into Play

May 25 2006 | 8:32pm ET

Traditionally, when an emerging hedge fund manager teams up with an incubator and exchanges equity for operational capital, the manager's long-term plan is to buy back control of the fund. While this is still a common goal, consolidation in the hedge fund industry has caused some savvy incubation firms to structure deals which they believe will be more profitable to both them and the managers in which they invest —selling the firm to a third party.

Westport, Conn.-based Weston Capital, which was founded by Albert Hallac in 1993, launched its first incubation fund in 2004 and has thus far seeded around eight managers. Chris Kelley, chief executive officer, explained that Weston Capital selectively seeds managers with proven track records and solid business plans, but one thing that sets the firm apart from other hedge fund incubators is its vision for an exit strategy.


In Depth

Fund Focus: Don’t Call K1T Capital A ‘Trend Follower’

Jul 10 2014 | 10:39am ET

You may call K1T Capital many things—systematic, quant-based, hedge fund—but...

Lifestyle

RenTech Founder Donation Establishes Quantitative Biology Institute

Jul 8 2014 | 5:19am ET

James Simons used math to make his fortune, and he’s dedicating some of it to...

Guest Contributor

As Hedge Funds Go Retail, Communications Is Key

Jul 2 2014 | 6:56am ET

The past two years have seen an explosion in the number of hedge fund managers rolling...

 

Sponsored Content

    Northern Trust Helps Hedge Funds Navigate Derivatives Regulations

    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…

Service Providers


Publisher's Note