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By Benedicte Gravrand, Opalesque London:
Julian Robertson, a legend in the hedge fund world for having run a highly successful hedge fund for 20 years, is also known for having mentored some of the brightest in the field, now known as the “Tiger Cubs.” What is less known about him, though, is that after his fund closed in 2000, he seeded quite a few young sparks too. He revealed, in a video interview with Opalesque, the decisive factors for selecting managers – and many other things.
About the Tiger
Julian H. Robertson was born in 1932 in North Carolina, served as an officer in the U.S. Navy until 1957, then worked as a stock-broker. He later spent a year in New Zealand with his family to write a novel. When he returned in 1980, Robertson launched Tiger Management, one of the earliest hedge funds, and one that was to become a legend in the industry.
Robertson is credited with turning $8m in start-up capital from friends and family into $22bn in 1998, and performing returns of more than 20% net yearly for 20 years. He gathered the smartest stock-pickers on Wall Street to work on the fund – which closed in March 2000, when poor stock picking – a lesson about the smartest -, together with the shorting of technology stocks caused sharp losses and investor withdrawals.
Tiger Cubs
Many of the traders and managers Robertson employed and mentored at Tiger Management – the “Tiger Cubs” – are now running some of the best-known hedge fund firms. And a lot of them are part of the Tiger Foundation, a New York charity. Here is the list of the 32 cubs, supplied by Tiger Management:
- Argonaut Capital Management – David Gerstenhaber
- Blue Ridge Capital – John Griffin
- Bowman Capital Management – Lawrence Bowman
- Bridger Management – Roberto Mignone
- Coatue Capital Management – Philippe Laffont
- Deerfield Capital – Arnold Snider
- Discovery Capital Management – Rob Citrone
- Duff Capital Advisors – Philip Duff
- Elmwood Advisors – Quinn Riordan
- Healthcor – Arthur B Cohen
- Hoplite Capital – John Lykouretzos
- Impala Asset Management – Robert Bishop
- Intrepid Capital Management – Steve Shapiro
- Joho Capital – Robert Karr
- Lone Pine Capital – Stephen Mandel
- Longhorn Capital Partners – Kris Kristynik
- Maverick Capital – Lee Ainslie
- Millgate Capital – James Lyle
- North Sound Capital (Rolled into Duff Capital) – Tom McAuley
- Pantera Capital Management – Dan Morehead
- Ridgefield Capital Management – Robert Ellis
- Roundrock Capital Management – Peter Vig
- Second Curve Capital – Tom Brown
- Shumway Capital Partners - Chris Shumway
- Speedwell – Fuyuki Fujiwara
- Sun Valley Gold – Peter Palmedo
- Suranya Capital Partners – Anu Murgai
- Toscafund – Martin Hughes
- Touradji Capital – Paul Touradji
- Valinor Management – David Gallo
- Viking Global Investors – Andreas Halvorsen
- Williamson McAree Investment Partners – Ed McAree & Robert Williamson
Tiger Seeds
Currently “retired,” Robertson manages his own money and also seeds smaller hedge funds. His net worth was enhanced over the years, and estimated by Forbes at $2.2bn in Sept-09.
“The Tiger Seeds are people that we have backed and we have a small piece of their company,” Robertson told Opalesque’s founder Matthias Knab in a recent video interview (here) in his Park Avenue offices. “And the Tiger cubs, most of them just went out on their own, having worked with me at Tiger.”
When shutting his fund in 2000, Robertson was left with a large, empty office space. He told Opalesque that he then persuaded three of his most successful analysts to stay. They were Robertson’s first seeding ventures – and turned out to be more successful than he had imaged.
He has seeded 38 funds so far:
- Axial Capital Institutional, LP - Marc Anderson / Eliav Assouline
- Apos Capital Partners, LP - Alok Agrawal
- Cascabel Scott. - Sinclair, Laurence Chang
- Catalpa - Joseph McAlinden
- DLH - David Henle
- ESG - Kevin Kenny
- ESG "Cross Border Equity" - Kevin Kenny
- Eastern Advisors - Scott Booth
- Fox Point Fund QP, LP - Charlie Andersen
- Goshen Global Equity, L.P. - Christopher J. Burn
- Green Eagle Credit Fund, LP - Glenn Migliozzi / Dan Sperrazza
- Hound Partners, LP 3 (c) (7) - Jonathan Auerbach
- Kelusa LP - RJ McCreary
- Lanexa Global Management - Ian Murray
- Longhorn Onshore investors - Kris Kristynik
- Long Oar Global Partners, LP - James Davidson
- Maple Leaf Partners, LP - Dane C. Andreeff
- Maple Leaf Discovery I, LP - Dane C. Andreeff
- Miura Global Partners II, LP - Pasco Alfaro / Richard Tumure
- Mojave Fund, LP - Michael Beebe
- North Oak Absolute Return Fund, LP - David Rockwell / Austin Root
- Pelagic Institutional, LP 3c7 - McAndrew Rudisill
- Pelagic Holdings, LP 3c1 - McAndrew Rudisill
- Sabretooth Onshore Fund, LP - Erez Kalir / Craig Perry
- Sun Valley Gold, LP - Peter Palmedo
- Teewinot Fund I - Michael J. Moriarty
- Tiger Asia - Bill Hwang
- Tiger Consumer - Pat McCormack
- Tiger Europe - Elena Piliptchak
- Tiger Eye Partners, LP - Ben Gambill
- Tiger Global, L.P - Chase Coleman
- Tiger Ratan Capital, LP - Nehal Chopra
- Tiger Shark - Tom Facciola
- Tiger Veda LP - Manish Chopra
- Touradji Global Resources Fund, LP - Paul Touradji
- Venesprie Capital Partners QP, LP - Quincy Fennebresque
- Wolfacre - Jon A. Ylvisaker
- WRA Investment Partners LP - Bill Araskog
Although there were no hints as to whether he had more in the pipeline, we learnt from WSJ.com shortly after that he was planning to seed a private-equity infrastructure firm led by Emil W. Henry Jr., a Lehman alumnus, which will be called Tiger Infrastructure Partners.
Talent, according to the Tiger
Robertson described his way to recognize and identify hedge fund talents during the video interview. “We have worked along some very successful hedge funds over the years,” he started. “There are certain traits that a lot of these people have and we have put all that information into a test that we give budding hedge funders.”
Indeed, Robertson uses state-of-the art, multi-dimensional profiling and psychological tests to indentify hedge fund talents, having worked closely with leading researchers from NY University.
The test assesses the managers’ honesty, intelligence, their ability to get along with their co-workers and their competitiveness. “Because we found that competitors are usually better hedge fund managers,” Robertson noted.
To be a good hedge fund manager, he said, you have to be “absolutely” honest, intelligent, competitive and be able to get along with a team.
“I can go beyond that,” he continued, “I think there is something strange in that the make-up of the most successful hedge fund people… [they] have a real interest in making this world a little bit better than it was when they got into it.”
Current positions
A sharp industry commentator, Robertson said when asked about his economic outlook in an interview with the FT last month: “I prefer to run scared through here. I think that if the Chinese stop buying our debt, it is virtually the end of the financial world as we know it. How likely is a Chinese boycott of American debt? The conventional thinking is that they will continue buying. But I don't think it's logical to assume somebody will continue to buy paper which declines in value. Our dollar is declining in value, and it's been pretty shocking over the last four or five months.”
At the New York Value Investing Congress, also last month, he said he was bullish on credit card companies, as well as the likes of Intel and Google, but would steer clear of gold as an inflation hedge, Reuters reported. He dismissed gold bugs as "certifiably crazy."
There’s more to the Tiger
Robertson is also an active philanthropist, and the founder and benefactor of the Robertson Scholars Program which awards a scholarship to 36 students each year. He is active as an investor and developer in New Zealand, where he spends much of his time and where he owns farms, golf courses and wineries.
To view Robertson talk about hedge fund managers’ profile, the Tiger Foundation, philanthropy, New Zealand, and golf on Opalesque TV, click here: Source
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