Evaluating SM TMT HFs
How do you evaluate whether a TMT L/S SM is a great seat? What questions do you ask during the interview process to figure that out and how do you think about the landscape?
I’m considering making the move to a TMT L/S fund. I’m familiar with the more established names (Viking, Tiger, Coatue, D1, Maverick, Lone Pine), but I’m less sure how to differentiate between other platforms like Alkeon, Anomaly, Avala, Avantyr, Cadian, Egerton, Hound, Jericho, Junto, Palestra, Steadfast, SurgoCap, XN, and others.
Since these opportunities rarely open and there is limited information, I’d love to hear how people evaluate them. Obviously, I want to work for a great investor who can help me sharpen my skills. Longer term, an ambitious goal would be to eventually raise my own capital, if I'm good, and I imagine being at a strong platform would be better to do that. Also, I understand the argument on MM but I'm pretty set on SM for now.
at a certain level of AUM, they are all the same. none of them are really differentiated on how they think nor trade. do you really think D1 and other tiger cubs have varying views on where semis will go in the next few years? they certainly dont trade weekly (although i did hear dan at d1 does day trade). not even bashing them - i work at a MM but i do think being a founder at a levered long tech beta hf is the fastest way to accumulate wealth in this era. but the LPs are the real suckers. pick any one of them and itd be the same
Is there a certain view on AUM then? 3bn+? How do you decide between them then? Based on historical performance and culture / mentorship?
first of all - none of them are really hedge funds. idk if you can really call them hedge funds (yes the tiger cubs especially) when their drawdown is 20%-40% in a 1-2 months of market downturn. they are just levered tech beta vehicles for the most part.
second - just look at the top AUM names 13Fs. youd see a heavy heavy tilt towards AI + mag 7 names and a lot of them overlap hence why we saw the flush in the last few weeks on overcrowded positions. youd see a pattern on the bigger you get - the harder it is to take levered tech beta bets on low liquidity names so you tend to just gravitate towards high liquidity ai names.
my point is that you can def mint cash at these places - its just that all these 5bn+ aum place are just all very similar in economics and the way youd learn how to invest. dont overthink this.
How do crossover funds like D1 interview? Is it mainly public equities focused / stock pitching, or do they lean in on growth equity style interviews too
Get some offers first
Thanks for the response. I don’t think that helps me too much because I’m happy in my current seat and don’t want to waste my time, or another firm’s time, interviewing for opportunities I wouldn’t seriously consider. I’m fortunate to be in a good position already, so I’m being fairly selective about the roles I pursue.
If you’re at a good fund, then stay.
Not worth going to a devil you don’t know
How about you make the interviews part of your due diligence, rather than rely on hearsay from an online forum?
Amused that your time is too valuable to sit for an hour with say XN because of something you read on WSO.
fax
Look at attrition the parse culture. Everyone is playing the same game here you want to maximize your attribution and points - Lone Pine & Coatue would be my picks.
Agree with your reasoning/criteria, but both Lone Pine and Coatue have incredibly high churn rates lol
Lone pine? Been pretty stable other than 2-3 people leaving last year. Prob one of the most stable SMs no?
My friend at Lone Pine is living a very comfortable low stress life. Coatue friends seem good too, they are both on the same team though. Think other teams at Coatue could have worse attrition it seems like.
the growing small TMT funds are likely way better long term seats then joining a big platform.
like avantyr, NX1, slate path, surgocap, kinetic, etc. is the sense I get from my network. These shops you can get promoted and grow with the firm, and have the best economics with founders willing to pay for talent.
Slate path more established than the others that have only been around 3-5 years. Have only heard positives tho
Bump
I worked at one of these and would say be honest with yourself. These firms should not exist because they generally speaking have negative idio. What you have here is a nice job like being a soothsayer or magician for an Egyptian pharaoh. If you are a soothsayer or magician, then you know it’s non-sense and this is the hardest part of the job imo. If you get a job working for the pharaoh making a snake dance to a flute where u are paid $900k TC, then your main goal becomes is this a job where you are relatively secure. Sometimes the snake will not dance, such as if it is a real snake. These are the main considerations.
excellent analogy
banger
I mean if your making consistent returns and your LPs are happy, who is complaining that your product is “low idio” ?
It’s not like SM product is charging 3/30+ like the pods for their returns.
This is the case where the snake does in fact dance to the flute. Of course you deserve to be paid in this case, you did your job and the onlookers will of course not complain.
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