McDermott Will & Schulte partners discuss hedge fund launch trends with Financial News

Peter Greene and Peter Naismith were quoted in Financial News discussing the continued appeal of co-mingled funds among US hedge fund founders and the fundraising challenges facing emerging managers.

Discussing launch structures and the use of separately managed accounts (SMAs), Peter Greene said, “Looking back over the past few years and considering the pipeline for 2027, we estimate that approximately 50% of our emerging manager clients launch with only a co-mingled fund, 30% launch with a co-mingled fund and at least one SMA, and 20% launch with only one or more SMAs.”

Peter Naismith noted that, while technology has reduced operational barriers to launching hedge funds, attracting capital remains challenging. “What has not become easier is raising capital. Allocators are concentrating their relationships, with a disproportionate share of inflows going to the largest multi-strategy platforms and the most well-pedigreed emerging managers,” he said.

He also emphasized the continued importance of a new manager’s track record and seed or anchor relationships.

Read the full article in Financial News: “Why US hedge fund founders aren’t giving up on co-mingled funds.”