馃攳
HOW TO START A HEDGE FUND WITH NO MONEY AND MAKE A BILLION DOLLAR - YouTube
Channel: Ertan Enginalev
[0]
How do you start a hedge fund with no
money
[2]
and make a billion dollars?
[5]
If you think it's clickbait
[7]
keep watching
[18]
Just as an FYI
[20]
What I'm about to share
[21]
is not meant to be a blueprint or a how-to guide.
[24]
It's just my personal experience
[26]
So your approach and results may vary
[30]
Now with that said
[31]
let's start with the five elements to launch a successful hedge fund
[35]
You will need pedigree
[37]
A track record
[38]
An investment strategy / process
[42]
A team
[43]
And of course outside investors
[45]
If you don't have all these elements already in place
[49]
Don't even think about starting a hedge fund
[52]
At least that's what everyone will tell you
[56]
The thing is
[57]
I didn't have pedigree
[58]
A track record
[59]
A team
[60]
or outside investors
[62]
All I had was two desks
[64]
An investment strategy
[66]
A process
[67]
And a single mission
[69]
So that's how I launched my firm back in
2014
[73]
Early on we gained some recognition as
the first activist investor in Turkey
[77]
and the first Turkey-based investment
team
[80]
with a global investment portfolio
[82]
and an international investor base
[85]
In our first year our portfolio companies
[87]
generated over a billion dollars in
shareholder value for investors
[92]
Today we still make the bulk of our money on the long side of our portfolio
[96]
but what ended up happening is that our short targets put us on the map
[101]
which is why most people mainly know us
[103]
for our 64 billion dollar BAT short
[107]
Our clients include some of the leading
single and multi-family offices in the world
[111]
managing around 20 billion in assets
[114]
Again I should note I had no pedigree, no
track record, no team no outside
[119]
when I started four years ago
[121]
Everything had to be build up from the ground up
[123]
while people kept telling me
[125]
it wouldn't work and it couldn't be done
[128]
So how did I do it?
[130]
Well
[131]
here's the secret
[132]
If you're like me and you don't have the five elements already in place
[136]
what you do is you scrap the hedge fund idea
[140]
Yes
[142]
The secret is to just deep-six it
[145]
Think about it
[145]
If you had the money to allocate to a hedge fund
[148]
would you hand over your cash
[150]
to somebody who popped out of nowhere with no track record
[154]
I know I wouldn't
[155]
So in my case to get around this problem
[158]
I took myself out of the equation
[160]
What I mean by that
[161]
is you start with an actual investment
opportunity
[164]
A listed company you want to invest in
[167]
and you approach investors with your investment thesis
[170]
to raise money for an SPV
[173]
which is basically a structure
[174]
that exists to make a single investment
[177]
This changes the dynamic
[178]
because the investors get to analyze an actual investment
[182]
rather than handing somebody a blank check and hoping for the best
[185]
which means it doesn't matter what school you attended
[188]
what investment bank you joined
[189]
or what big fund you worked at
[192]
All that matters
[193]
is the strength of your investment thesis
[196]
your investment strategy
[197]
and your process
[199]
Now the key to make this approach work
[201]
is to answer the three why's
[204]
Why this investment
[206]
Why now
[207]
And why invest with you
[209]
Depending on your investment strategy
[211]
this can be very easy
[213]
or very difficult
[215]
But if what you bring to the table
[217]
is truly unique
[218]
you will end up in a situation where an investor will put up all the money
[222]
and cover all your expenses to get up and running
[225]
The goal is not to make a big splash
[227]
The goal is to build a track record and credibility
[231]
which is what attracts talent and
investors
[234]
The more traditional route of course
[236]
is to just go out there and launch a hedge fund
[239]
It's possible
[240]
but without experience
[241]
and an industry profile
[244]
you'll just end up banging your head against a lot of walls
[248]
And yes
[249]
Some of the most successful hedge funds
[250]
were started by first-time portfolio managers
[253]
in their 20s
[256]
Warren Buffett was 25 when he founded his fund
[259]
Ray Dalio was 26 when he founded Bridgewater
[262]
Seth Klarman was 25 when he founded Baupost
[265]
Ken Griffin was 22 when he founded Citadel
[268]
Paul Tudor Jones was 26 when he found a
Tudor
[272]
Jim Chanos was 28 when he founded Kynikos
[275]
And David Einhorn was
28 when he founded Greenlight
[278]
It can definitely be done
[280]
But the truth is
[281]
the industry has changed a lot in the last 10 years
[284]
and regulatory changes
[286]
have made it much harder
[288]
to start small
[289]
and build up
[290]
Fortunately for you the industry is going through a transition right now
[294]
which creates significant opportunities
[297]
for people who bring something truly new and unique to the table
[301]
So if that's you
[302]
I would definitely encourage you to throw your hat into the ring
[305]
Just remember to drop me a line
[307]
when you get to your first billion
[319]
Hey you're not gonna get far watching
YouTube videos all day
[321]
Let's get to work
Most Recent Videos:
You can go back to the homepage right here: Homepage