Are you neither senior nor junior but somewhere in between? Some bold-faced names such as Greg Coffey and Jon Corzine are launching new hedge funds, but they're unlikely to want to hire you. Why? The newer the hedge fund firm, the less likely it will be looking to hire mid-career-stage professionals, as typically the co-founders bring over senior-ranking former colleagues and then prioritize junior hires.
On the buy side, senior-level people who can attract clients and generate revenue are always in demand. While big, established hedge funds do hire mid-ranking professionals, recently launched firms typically recruit highly experienced and early-career-stage professionals but not much in between.
Who do buy-side firms most want to hire? Experienced professionals with a proven ability to generate revenue and take entrepreneurial risks, according to Alexis DuFresne, director of asset management at Whitney Partners.
“Newly launched firms have to make key operational hires, including a senior IR or marketing person,” DuFresne says. “Usually a fund launches with a veteran PM or two who build their firm with investment talent they’ve worked with in the past or they'll hire junior research analysts for support.”
Usually by the time the firm launches, they have leadership in place – the CEO/CIO and CFO/COO – and a senior marketing person is often an early hire to remain competitive and to attract assets, DuFresne says. Then they hire junior marketers for the senior person to mentor.
“We’re currently seeing a re-staffing of fundraising roles, including significant senior hires,” she says.
Currently, there’s a significant desire for healthcare sector expertise. However, hedge funds are more open to hiring less-expensive juniors such as IB analysts who they can rotate if necessary, rather than bringing on more specialized mid-ranking professionals with specific sector or industry experience.
“Most hedge funds are shifting their personnel at the analyst and associate levels based on their most pressing needs and then back-filling those seats – if they have someone strong covering energy, they may swing them over to healthcare, then hire someone new to cover energy,” says Steven Gold, a partner at Green Key Resources.
For a new launch, managers will hire middle- and back-office roles such as risk and infrastructure and front-office staff at the same time, sometimes doing a reverse build-out, he says, filling out senior managers and junior staff while waiting on beefing up the middle ranks.
“They’re bringing in top individuals across the board, a controller/CFO, the director of ops/COO and the head of risk/CRO, and you’d think the next hires would be their right-hand folks, but actually they’re going very junior, seeing where the gaps are, and then filling in the middle as the final step.”
Newly launched hedge funds build out investment teams by hiring junior analysts from other hedge funds and investment bankers, as well as junior buy-side and sell-side researchers. Gold says that their common preference is usually to hire from other hedge funds for experienced traders and senior investment analysts.
Mid-ranking professionals may be better off focusing their efforts on earning a promotion at their current firm or trying to get their foot in the door at an established buy-side firm rather than trying to jump to a newly launched hedge fund.
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