Hedge Funds Are Facing a Talent Shortage, But Not in the Area You Might Think

This has been one of the most difficult fundraising environments in years — but mostly for smaller funds, according to one expert. For example, Izzy Englander’s Millennium Management attracted $20 billion in investor interest but decided to stick to its original $10 billion fundraising cap. Meanwhile, newer fund managers are having to stay smaller for longer to establish the track record investors want to see.

In a recent interview with Hedge Fund Alpha, Nicholas Tsafos of accounting and advisory firm EisnerAmper explained why the fundraising environment is so challenging right now. He highlighted some of the other key challenges facing hedge funds, noting that a shortage of talent in one particular area is a key issue. Tsafos has more than 30 years of experience in accounting and auditing. He focuses primarily on hedge funds, private equity funds, and broker-dealers.

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What hedge funds are investing in

Currently hedge funds are largely investing in markets where people need a product or service the company is selling. For example, everyone needs utilities and likes to have insurance, so these are stable industries that hedge funds are targeting. While some might not consider technology a stable industry, Tsafos noted that it’s such a big part of our lives these days that people need it.