Journey to starting a hedge fund in FL
Hi Everyone,
I've found articles here that have helped me with a million things so I want to give back to this forum and the internet by detailing exactly how I will start a hedge fund in Florida. I am starting from 0, zero, zilch....
If you have questions, PM me or post here, and I will try to answer as much as I can but right now it's not much. I will know much more by the end of the journey.
BTW, I am cheap and while I want to make things as legitimate and perfect as possible, I will always be trying to do most of the things myself. You guessed it, I won't be using attorneys.
PS: My budget is 2k :)
Let me guess - Boca Raton
Where did you look for guidance on this? Were there particularly informative articles you can share on bootstrapping a HF?
Strategy? Fee structure? Current or target AUM?
Are you finding 2k to be enough to cover startup costs? ...
i'd be interested as part of your investor relations team. im in fl and have a few reputable attorneys that owe me some favors.
Blackhat: LP filing cost is 1k and LLC cost is $125.
One of the things I want to set out and prove that it is possible to start a hedge fund with less than 2k and it can be done without the help of attorneys.
I've found a few articles on here about starting a HF, but most of the information is scattered across the internet on blogs, journals, comments on blogs, etc. However, I do have some documents that I have found particularly helpful and I can send them to anyone who is interested.
I didn't mention this before but yes, I do currently trade and I am profitable.
Just b/c it's possible doesn't mean you should do it. I'd think long and hard about accepting accredited investors' money who have armies of networked attorneys before you saddle up refusing to add one. Also there won't be many willing to do business with such unless you are wanting to be one of 'those' funds.
South Florida is the wild fucking west when it comes to law and investments, which I'm sure you're well aware of. The all-too-likely crossing of international borders will also increase these risks.
I do currently trade, and am profitable, when I pull up my Fidelity account there is a lot more than $2k, I work for a hedge fund that has a 25+ year track record of very strong out-performance, I want to start a hedge fund one day, but don't think I'm anywhere near close.
I'm not trying to be a hater, but seriously, go spend the 2k on a vacation.
I bet you don't utilize complex quantitative methods to exploit inefficiencies in the equity markets with lightning fast speed though. Institutional backing? Where's your superstar? You don't have the kind of resources it takes to get a fund off the ground... and let me tell you something, sir, the most important ingredient is a LIQUID $2K.
When I hear "liquid $2k" I think of my cumulative bar bill from the last month
Why are you doing this?
I will be creating a NV Limited Partnership with a FL LLC as the general partner. I will post the exact costs once I pay for everything.
If you can't afford to spend $25k on starting a hedge fund don't bother. You won't be able to raise outside money, investors know that below that level the legal structure is unlikely to hold up in court.
Agreed. Legal structure, compliance controls, operational infrastructure just to name a few.
Emerging managers who have $50mm and all of this are having enough trouble raising capital.
Christopher Gardner: You got a dream... You gotta protect it. People can't do somethin' themselves, they wanna tell you you can't do it. If you want somethin', go get it. Period.
how much capital have you raised?
why wouldn't you do it through caymans like every other pe/hf?
Better call Saul!
(it rhymes)
best of luck to you in your endeavors!
Rule #1 of any institutional investor or family office:
Never, under any circumstances invest in Florida hedge funds.
Why is this a rule?
It's kind of a joke, but the few Florida hedge funds my former employers had conducted strategic and operational due diligence on all had severe red flags. In general most people raising assets and running money from Florida generally have less compliance and often have moved to Florida to escape disastrous reputations in New York, for example.
So basically, my empirical evidence (small) and the general agreement among my peers and colleagues is that Florida hedge funds are bad news from a compliance standpoint.
I'm sure the media doesn't help this hazard.
Wanted to revive this thread to see if anyone had a list of HFs or PE shops in FL?
ESL - Eddie Lampert Fir Tree Vinik Everest iii / AVM H.I.G. Sun Capital
These are the largest and most reputable. All are multi billion.
Please share with us with more details
What details do you seek?
how exactly the OP plans to start his HF with only 2k. how he will raise fund, etc.
First off, good luck. If you're trying to set up a HF for the sake of running your own HF out of FL, costs are one thing…and something I don't know anything about. If you're trying to set one up to build it into something bigger and more profitable, the most important thing is a track record. Develop a strategy or focus…you need a niche…and start trading/investing. I don't think geography matters all that much when it comes to being successful in the industry. Of course, there are many more in NYC, London, etc…but some of the most successful HF managers I know live in other cities…including several down in FL.
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