Leaving IB as First year Analyst to Build a Hedge Fund From Scratch in Monaco — Career Suicide ?
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You are likely qualified enough for a junior analyst role at any of the MM platforms in London at this point so if you’re interested in making the move to a hedge fund, I would not think that this is the only opportunity.
Things I would think about:
I would also add that I would think long and hard about the mentorship you will get at this firm. Will the seniors train and teach you? This is the most important point. No offense but your “top bucket at GS” is pretty irrelevant for what this job truly is. Spoiler - it’s more than just building pretty models.
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If you’re someone who just wants things to be laid out, structured, guaranteed, you should probably stay in IB. However, if you want to take the risk to be extraordinary you have to capitalize on opportunities like this when they arise.
To be frank with you this sounds retarded and doomed to fail. You will have plenty of opportunities to take a big career swing between now and the time you're 40. If you take a punt now and it doesn't work (which seems like a probable outcome given the risks you've mentioned), you will have a tough time getting your career back on track. If you take the same punt 5 - 10 years from now and have built up a career and a strong network, you will much more easily be able to get back into the business if things go south. Simply put, you don't have enough career capital to take a risk like this at the moment, and this doesn't seem like a good risk to take in the first place. This seems like a pass in my opinion.
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that sounds even worse
Take it, long/short in Europe is not long/short in the US. If you have the opportunity to work for someone you genuinely like, is willing to invest in your development and is plugged in enough to work at the FO of one the wealthy boot-laced European families, then it’s better than most opportunities in public equities in London.
What do you mean by L/S in Europe is not L/S in the USA? Is that to say there are not comparable opportunities in London that there are in New York?
Same risk, less reward
can I short it?
Yeah pls share your long book so I can take the under
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Yeah, that's fucking epic and you should definitely do it. But lots of people in this sub are going to tell you it's better working 80 hours a week until you're 30 with no meaningful chance at carry, just so you have "stability" and can marry some washed up sorority girl
Ok, so this is a great question and show's you're being thoughtful. I would be more amped for you if the PM had a good solid track. As you know this is a tough business, the FO could quickly change their minds. You still only have one source of capital, an FO, and the optimal position is to have multiple sources of capital or a source of capital from an established MM working under a PM that knows that firm well and/or is a top/solid consistent performer. 200-400 GMV is ok, not great if it's simply 50-100mm levered 4 x... I'd want to know what the pathway is with the FO from a GMV standpoint, maybe try to understand the economics he has with the FO better... the timeframe. Has he paid a bonus out to you? If he has been very generous previously by way of prior bonus, that would be a solid sign. If he's never paid you a bonus, you don't know his economics with FO, and he's lost roles before because he's lost money... Gun to my head I'm staying in London.
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They are taking ~20m and leveraging it 12x? That seems pretty crazy.. 8% drawdown and you’re wiped out. Unless you’re running extremely tight (not real investing) this seems very hard to manage.
I was fully pro going to the Family Office to work on the L/S strategy until now lol... that 12x leverage seems insane...
CIO not wanting to lose money first few years and 12x leverage seem contradictory here. Everything has to work perfectly
The BSDs that we all read about and aspired to be - few of them took the conventional route to success. Did Stevie Cohen have GS pedigree? Whether it be dorm room (Citadel) or cab driver (Caxton) or golf caddy (Tiger) or IT (DE Shaw) the unifying theme is when the opportunity to accelerate arose they grabbed it
Same goes more broadly. Who would want to work at Nomura as a stepping stone to your own PE firm? Terra Firma is just that
Sure, there’s survivorship bias and plenty of others failed. Do you have the conviction that you can be great? If so, what are you waiting for?
New platform, exposure to one of the richest families on Earth, if your PM blows up but you are in an office with people so rich they have no idea where else to park their money, surely you can make something out of it. More money than sense is an opportunity, not a problem as long as you bring the sense.
12x seems too levered, $2-400mm GMV seems low, and there are lots of reasons to say no and quibble with the opportunity. If you have purpose and conviction and know that you can win over the principals, none of that matters.
This was my instinct as well. This sounds awesome...grab life by the horns!
You can’t take meaningful positions with 400m GMV
Idiotic take
Wdym… 400m is a small/medium sized carve out at a US HF.
Anytime someone hand picks you for something it means they like you a great deal, so I would tend to take it and accept the uncertainty.
That said, my 2c anecdata is that Monaco selects for the type of person you do not want to work for.
There’s no debate - take it. You can get another job after no problem.
This site is hilarious risk adverse, there’s such small risk here.
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