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By Benedicte Gravrand, Opalesque London:
Seed capital, the initial capital used to start a business, is sometimes provided by seeding businesses to the hedge fund industry. According to a White Paper issued in October 2008 by Infovest21, a New York-based information services company, one of the few potential long-term beneficiaries of the credit crisis and meltdown would be the hedge fund incubating/seeding business – partly due to collapsed brokerage firms letting go of talented people and hedge fund employees looking to leave a sinking ship. Indeed, a lot of these people will be setting up shop and looking for backers.
Paul Smith of Triple A Partners told Asian Investor in February just that: “It's a great time to be a seeder. Pricing power is on the seeders' side as there is not much capital around. Secondly, there is a lot of talent around and that's not just people who have been laid off. Thirdly, the opportunities for investment returns have never been better as so much capital has left the market and the upside is so much greater. What you don't have though right now, once you have seeded a fund, is the ability to distribute it…”
In October-08, FRM Capital...................... To view our full article Click here
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