HF Seeding
Besides Millennium, which platforms or fund of funds or allocators do similar seed deals that Millennium does?
If one were ready to spin-out but didn’t want to go to MLP for initial check, who else does this?
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Based on the most helpful WSO content, if you're looking for platforms or allocators that engage in hedge fund seeding deals similar to Millennium, there are a few notable options to consider. Some of the names that have been mentioned in discussions include:
These platforms often look for managers with a strong track record and a clear strategy. If you're ready to spin out but want to avoid Millennium or MLP, these could be viable alternatives to explore.
Sources: Up and Coming Funds, Citadel vs. Millennium vs. Point72 vs. Other Multi-Managers, https://www.wallstreetoasis.com/forum/private-equity/going-from-mm-investment-bank-to-mega-fund?customgpt=1, Small Fund vs. Rollup, Impact Funds Oncycle Recruiting?
Bump
There are lots, and no two are exactly alike. I’m not sure I’d call Millennium a seeder though …
I’d add a few thoughts:
- there is no such thing as an ‘initial check’. you get one shot at each firm and you need to be high-conviction-ready-to-go from the start.
- it is worth talking to as many people as possible , and analyzing your own track record deeply, to understand how to pitch yourself, how compelling you might be to each different organization, and how you would fit within each. They are all different.
- think through the likely economics of each, and how much capital you’d require in exchange for what economics. They vary widely from revenue share to fee discount to first-loss.
- finally you need to think carefully about how you’d structure your business and be able to talk through it . Anybody putting you in business will need to be confident you can run the business sustainably.
We ran through all the possibilities, met with many partners , and launched with our own capital plus friends and family in the end.
It’s an exciting thing to do; good luck!
Thanks. But besides MLP, any other names that you come across ?
Again I would not call them a seeder: a group that backs a manager to build a standalone business. That’s where Tiger, Boothbay, Topwater, Grosvenor, Stable, etc operate. Millennium, Balyasny, Point72, Hudson Bay etc are multi manager operations where a manager operates within their framework. There are tons more of both kinds, and tons in between too
Blackstone does a similar thing to MLP. We didn’t like either of their terms though. They do cut pretty big checks though ($50-100mm).
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