Hedge Fund Launch & Structuring

Situation

A successful fixed income trader at a top three investment bank prop desk was preparing to exit and start an independent hedge fund. The investment bank had complete visibility into the trader's historical track performance, risk profile, typical trades and use of leverage, and understood it had a rare opportunity to participate in the upside of this new venture.

What We Did

Silver Ridge was engaged to lead the structuring and launch of the new investment management company. Our work encompassed the full scope of establishing a new hedge fund:

• Operating Agreement Negotiation: Structured the operating agreement of the new investment management company, securing a GP equity position for the seed investor
• LP Investment Terms: Negotiated terms for the LP seed investment with preferred returns
• Employment Agreements: Developed employment agreements for the investment team
• Office Build-Out: Fit-out a midtown Manhattan office for the firm, including a trading desk and data center
• Business Planning: Developed the business plan and pro forma reflecting the firm's plans for growth

Impact

Field Street Capital Management launched successfully and has grown into one of the most successful investment managers in the fixed income and global macro space. The fund has grown from $75 million in seed capital to current assets under management exceeding $44 billion, delivering exceptional returns to investors while maintaining the risk discipline that characterized the founder's proprietary trading career.

The structuring work performed by Silver Ridge ensured that all parties—the founding trader, the seed investor, and the investment team—were aligned for long-term success, with appropriate incentives and governance frameworks in place from day one.