Staffing a sub-$1bn hedge fund.

Having the right people on your team is now more important than ever. Understanding how the make the right hires can help

With more than £9.4trn of assets under management in the UK, it’s no secret that it’s a continued challenge to raise and retain capital. Global turmoil like high inflation numbers, changes in monetary policies, geopolitical tensions and soaring energy prices have only made this harder. In a turbulent market shaken by global uncertainty, coming up with a viable game plan is necessary to take your non-investment team from startup to $1bn. For first-time COO’s or investment professionals looking to make their first non-investment hires, it is invaluable to get decision making on new hires right fist time. 

As with most things in the industry, people sit at the centre of a business's success. To keep up in uncertain times, facing strong headwinds, fund managers are having to make tough decisions based on cost and operational efficiencies as well as how to generate alpha. Fund managers cannot do better than truly prepare for their future, both in terms of opportunities and ongoing challenges. It’s essential to understand the cost of a growing hedge fund infrastructure to accurately benchmark budgets, measure performance, facilitate team growth, and supply the basis for business strategies.

By dissecting the inner workings of your non-investment team, you will be able to pinpoint the big-picture implications of the wrong hiring decision and, more importantly, highlight the benefits of the right ones. If this isn’t clearly mapped out, your fund will be limiting their access to the best possible hires, made at the best possible time. 

The key roles to consider

Hedge funds can vary considerably in size, from funds valued at less than $1bn to the world’s largest hedge funds valued at over $100bn. Consequently, the number of employees also differs from fund to fund.

Several different roles contribute to the smooth running of a hedge fund, including the C-Suite executives to those who make up the non-investment side of the business. It’s crucial to know who does what before you start your hiring process. Your C Suite hires will differ from depending on your firm, strategy, and budget. Reach out to Mush for a detailed chat about how you can make your first successful senior hire while also aiming to plan for the future and what that might look like from a growth and hiring perspective.  

What does it cost to run a non-investment team? 

There are plenty of costs involved in running and managing a fund, from research and trading fees to set-up costs, office space, marketing, business development, staff and fund managers renumeration. Non-investment teams are made up of the COO, compliance, legal, marketing, sales, and investor relations teams. For a fund operating below $1bn, salaries for your non-investment team can range anywhere from £350K to £1.7m.

What One Ten Associates can do

The ability to hire decisively and effectively is key for a fund growing at pace. At One Ten Associates, we can’t stress the importance of having an experienced, specialised team on your side enough. Making a non-investment hire can be difficult. Often, those making them will come from an investment background and are likely to be unsure of what to look out for. That’s where One Ten Associates come in. 

We have 20 years of combined non-investment experience and can actively guide you through your essential first hires.