Matthew Denning Bob Discolo

Matthew Denning,Senior Research Analyst at PineBridge Investments, a $69bn asset manager, said during the latest Opalesque New York Roundtable that PineBridge's first seeding vehicle had $400m from which the firm seeded five managers, and that ticket sizes were up to $125m.

"We feel we invested with some good managers, but true, negative selection can occur," he continued. "We also realized that we passed up on some good opportunities that would have been around the $40-$50 million seed size."

Seeders aim for around 10 times asset growth potential, he explained, and in quite a number of strategies, managers stop at the $400-$500m AuM range to stay small enough to generate the best returns for an investor.

"Our next seeding venture will now include these smaller ticket seed deals."

Denning, as well as Bob Discolo, a hedge fund industry veteran who currently oversees roughly $3.7 billion as Head of Hedge Fund Solutions Group at PineBridge, spoke to Opalesque New Managers about their seeding venture.

Amid its troubled period, American International Group, Inc. (AIG) rebranded its asset management and investment advisory business PineBridge Investments in November'09,......................

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This article was published in Opalesque's New Managers a top-down monthly analysis, news and research publication on the global emerging manager space.