BBG: Plotkin Aims to Bury GameStop Nightmare in Hedge Fund Reboot
Surprised no one posted this already. Pretty brazen.
A year after amateur traders turned the tables on Wall Street pros with GameStop Corp. and other meme stocks, Plotkin is making an all-in play to salvage his stricken hedge fund firm, Melvin Capital Management.
The plan: Cut Melvin to a more manageable size, but require investors who decide to stay to pay performance fees again even though they’re underwater.
Where do I sign up for this gig?
Yeah, and I wonder how much he's gotten crushed in April? My sense is that he possibly got burned by going long on growth stocks this month, thinking that the worst was over, which is what motivated him to say "F it, I'm going back to shorting."
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couldn't agree more
I'd be shocked if he can actually pull it off. Meriwether had his blowups/restarts but at least he started with new name and ostensibly new LPs. This guy is laughing at his current LPs when he comes up with this brazen play.
I don't blame him - industry is built on greed and being a grifter. I'd blame the stupid LPs who sign up.
Returning 30% YOY since inception (apart from the GME situation) is no easy feat. Gabe is gonna bounce back.
Hard to root for him. Behavior like this gives a bad name to the entire industry.
This guy is missing a shame gland.
I really hope his LPs are not this dumb.
You'd think he wouldn't put this in motion unless he got private buy in from enough of them.
We are all far too optimistic in how the world works. This kind of stuff happens a lot and I am with the other poster the idea probably came from some LPs themselves.
They know we are moving to an environment where shorting works again, stock picking works again a few good quarters and he's back to raising money and fund is manageable.
Does it make whole industry look bad yes but happens. Now if he messes up again, I would assume hes done for good.
Ok then, line up the reddit army and put this clown Gabe P outta biz.
Hah thats the attitude. Funny thing we will never know how much Ken Griffin made off keeping him alive and trading the vol of GME among other things. Truly feels like an episode of Billions (when the show was good).
He’d have the best shot of this if feed crystallize on a delayed basis. Imagine if he only collected fees every 2 years. That might entice LPs.
I suspect it will be some sort of partial recapture of fees. I.e., 1/10 until he hits high water then full freight fees again. a handful of funds do this for PMs who have a down year bc they don’t want good people leaving bc of a bad year (not traditional pod shops).
I was thinking a large driver of this move could be needing to right size his structure in order to retain talent moreso than Gabe misses his own pay days
That’s exactly my read too.
He paid out of pocket last year but difficult to keep doing that.
this should be linked to the thread about finance gurus on YouTube. you can be a successful professional and lose more money than YouTube gurus' picks even if you make right bets (Gamestop is indeed a shitty business that is losing money for years).
Hahahahahahahaha
Who wins:
1 of the top fundamental L/S funds of the last 5 years
vs
1 stonky boi
He issued a mea culpa. New plan forthcoming….
A "more balanced plan", in his words. How do you balance doing what's right with something outrageous? Curious to find out.
Such a joke hearing a dude worth >$1bn in his personal account claiming he needs to waive HWM in order to pay/retain his team.
gabe really a billionaire?
Ouchie ouchie I guess investors you've already lost billions aren't thrilled to hear you're considering starting fresh just to reset your high-water mark and keep taking fees
Wonder who those critical mass investors were and what sweet deal they were getting in exchange for backing this structure... ;)
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