TAAAP/HF StartUp Event

I attended a hedge fund start up event last night in New York City. It was hosted by some organization called TAAAP (lot o A’s) however I received an invite through HedgeFundBlogger.com:

I always ask myself why in the world do I goto these things, the information is usually old and/or obvious, the events are usually full of job seekers or service providers, and I am usually the youngest person there. I think I have come to the realization that the event itself is useless, its the ability to meet for a drink afterwards and actually discuss relevant topics. The best ‘networking’ events I’ve been to have usually been casual meetings in a bar or lounge, one or two tables, and plenty of drinks. Once you get over the akwardness of sitting down then the conversation usually flows. I still continue to feel akward at traditional networking events.

In any case, this event had some decent information for start-ups. The initial discussion focused on operations, running of the business, administration, etc. All the really fun stuff that is unfortunately crucial to a limited partnership structure. The second half focused on capital raising. Although there was a lot of eloquent talk regarding pitchbooks, and third party marketers,  and due diligence, the most salient point was relationship building. Your probability of raising money will skyrocket if you have some personal connection with the investor your dealing with. This may seem obvious but to a startup manager the initial reaction is to blast your marketing document to everyone and their mother with the expectation that, hey you see how great my returns are and low correlation to the market; how can you say no? One panel member put it very succintly, the investors job IS TO SAY NO. Like an initial job search, the first step is a weeding out process because everyone is pitching great returns, low vol, low corr. Very important point in my opinion and a good viewpoint in preparing for a capital raising speech.

But let me go back to relationship management. It’s simply about knowing the right people. What if your like me and don’t have the contacts or don’t hob nob with the jet set? Perhaps you just fix their jets (vague Wall Street reference)? Well thats what I’m asking you! Let me know your ideas and thoughts.

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~ by largecaptrader on June 19, 2009.

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