YouSaid · the spoken record

Ilana Weinstein

lines on the record: 138
first: 2019-11-22
most recent: 2019-11-22
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“That's exactly what it is. So there's a lot of that that we do as well. But let me, because this is an important point, come back to where we are today, because we are in a very different place today than we were when this industry first started, when IDW first started. So when you look at returns for most funds, again, single manager funds, it's like you look at 15, 16, 17, and 18, the last four full years, it's really bad. If you add up the cumulative return, it's a sea of red. And pointing to this.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Of an aqua hire, a fund like Citadel doesn't need the assets of a $250 million fund. Far from. That $250 million fund needs Citadel because they can't grow. They don't have scale. They can't compete for resources, talent, capital, they are inconsequential. However, if they've had good returns, that's a great place for them to be because now they can scale that business.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“That's absolutely part of what's underlying that. And the other piece, which I was getting to that's underlying, that is now the difficulty of generating alpha. So returns have come. So yes, most funds are small. They're inconsequential. You're not going to make a lot of money managing like a couple hundred million and many of them are even smaller than that. And they're not going to exist most of these guys or they'll just be okay managing a little bit of money. That's a different business model. That's not what you and I are talking about. That's not our client base and that's typically. And those small guys, they're lucky if they're in our office because what we're doing with them is we're popping them into bigger funds. We do a lot of acquisition of hedge funds as well. So they'll get gobbled up by the bigger players if they're any good and they should be thankful for that because they'll have now a lot more capital, resources and artillery for lack of a better word to be successful.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Probably, yeah. I mean, I don't know the exact number, but that's the majority of funds just because in order to be. Think about it there aren't who else you know there's not that many other funds you can name that are multi managers right and in terms of multi-strats those would be funds like Davidson Kempner Goldentry Angela Gordon these are behemoths that are in multiple strategies and managing 30 billion or whatever it is dollars. There aren't that many funds that look like that. Most funds are actually quite small. Most hedge funds are, I think the two-thirds of hedge funds are $250 million or less. So, this is like a cottage industry of two bit players for the most part. Wait after.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“And they're not multi strats, although the actual number of hedge funds, the individual hedge funds tend to be single manager funds.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Did that way. I don't have to subject myself to this. So for all of those reasons, it's become far more difficult to generate alpha. And what you see literally the last good year for most of these funds, and when I say most, one other sort of clarification point, we talk about 11,000 hedge funds. Most of them are single manager funds. They're not multi-managers.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Now sitting at these shops. And so many more eyes and ears at conferences and behind a shorting model that can suss out underperformance. So if management says something squishy at a conference, it used to have three to six months for that underperformance to get priced fully. Now that happens in two days. Amazing. So the window of efficiency for performance has gotten much smaller. And LPs, as I said, have gotten much more sophisticated. And so with all of this, returns have come down because the industry is so much more crowded. Oh, and liquidity, right? Mutual funds and retail have shrunk. So there's far less liquidity now than there was back then. Fewer companies are going public, right? With increased regulation and scrutiny, CEOs are like, I don't want to go public. If I'm a tech company, I can just go to a big tech private equity firm and get funds.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Became much more sophisticated, right? Think about technology in 2003 to today. Today, everyone has access to the same information. That's why it's so important in this business to have the ability to have data science and quant and a machine internally that can turn that data into alpha signals. Very few funds do that successfully, but it gives their people a tremendous leg up if they do create that in-house. So everyone has access to the same data. Information's much more transparent. Also since 2003, to date, you have the platforms. When I say the platforms, I talk about the multi-managers like Citadel and 0.72 and Millennium and Ballyazney. These guys exploded. They got so much bigger. You have all these PMs.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Accounting operations trading. Which is what it was. Right. So we were brought in all these founders that we did work for on the investing side said, well, wait a second. You know, my head of marketing isn't going to cut it anymore. My COO isn't going to cut. So we had to revamp these funds and make them institutional, right? So they would be attractive to institutional LPs. So what happened is you saw all this institutional money pouring into the and pouring into the hedge fund world and institutional LPs were also far less sophisticated back then about hedge funds because it was a new asset class to them. So what happened? So we went, so you had this huge growth of funds, tremendous amount of capital pouring into the industry, technology.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Non investment administrative side operations. Well, yeah, but senior. But what really drove that was post-crisis, you saw all the... The shift from fund to funds and high net worth L keys to institutional LPs because they realized that had they invested in a hedge fund, they would have done much better. Buying the market, right? Most hedge funds were down, they were down, but they were down half as much as the SP on average. That's about right. So institutions said, well, wait a second. This is like, this is an asset class that we should be investing in. And so all of a sudden, hedge funds had to look.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Capital flowing in literally, especially post crisis, right? That's when you saw the shift, right? And that's also, you know, you mentioned earlier we do, which we do, work to find investment talent for the hedge fund industry, but we also do work to find, and this is when this started was in 2008, we have a very meaty practice looking at non-investment talent across functions like president, COO, head of marketing.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“It's been a very, very tough time. And let's juxtapose it to when I started, which we talked about earlier, which was 2003. That's when I started my firm. $500 billion of assets under management, 3,000 hedge funds. As you said, Barry, now there's 11,000 hedge funds and three and a half trillion of AUM. A lot of that growth actually came post-crisis at the time of 2008 was 1.4 trillion. Now it's three and a half. So that's a lot of growth actually in the last 10 years.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Although it's rare, you know, there isn't something else because our clients tend to be very innovative and creative to attract someone like that. There are times he should stay exactly where he's at, but more often than not, we can set something up that is structurally superior to where he is, even at that level. That's a very different dynamic than somebody who like needs a job.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“What do you think about the structure of where I'm sitting? What else exists out there? Here's what I've built. Do I take my bag of tricks and do something different? And then what does different look like? What should compensation look like for me? It's an advisory meeting. And in that, it is our job to understand everything about his firm before he walks in, which we know. Why do we know? Because we've met plenty of other people at that firm constantly. And also understand what all his other options look like. So we have to have deep intelligence on all the other funds that he could theoretically think about and then have a point of view on which of our clients could make sense. And there are times there isn't.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“And compensation for him has typically been between 20 and 30 a year. He's not looking for a job and he's at a great firm, by the way, which is not at all facing the issues other firms are facing. He's coming in to talk to me and my team because he wants to understand, given what we do, given all the smart people we meet and the clients we have and everything we see across the entire hedge fund landscape,”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Not even double digit. No, no, no. Triple digit. This is an actual candidate. And this isn't an outlier. This is like, this is. Every day, what we do. So 5 billion triple digit P&L and the last four years have been really, really difficult. So that's quite an accomplishment, right? Much, much tougher environment, which we can talk about.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“That's a happy coincidence. It makes our job a little bit easier. All we care about, all we care about is that first bubble. And really talented people. Who have accomplished something special? This would not be an unusual profile of a candidate. Somebody who oversees $5 billion where they sit today has had triple digit P&L every year for the last. Specifically”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Best in class, and there were very few people in any asset class I'd put into that bubble that are really that good. Again, there's all the work we do to make sure we're leaving no stone unturned I really have a firm view on who is best in class my firm does before we start any search. That's why I say we sort of know the answer, but we just want it, we do all the work to make sure we're not missing anybody. The second bubble is people who are disenfranchised, miserable looking for jobs. If there's an overlap and these days for a variety of reasons we can get into, there's probably more of an overlap than ever before.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“No, we are at the risk of being totally immodest, I will tell you, for a variety of reasons. I don't think we look like anybody else. The most prominent One of which is the level we work at and the access to the people that we have. So it's, yes, there are discrete roles that founders need to fill. Yes, we are hired to complete those searches, but they tend to be really important searches that will move the needle for the fund. And if it's a fund, that's, let's call it, somewhere between $10 and $40 billion, that's a really important person. And it's not about who's looking for a job. It's not about, you know, who's available. That's not how we come at things. If you think of a Venn diagram, one bubble being”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“That is the only way we work. And I will tell you, we're doing a search right now where the founder was candid with me. He may not even end up hiring someone. He just sees an opportunity that he may being the operative word want to capitalize upon and wants to meet the smartest people who do this out there and then lets iterate on what makes sense. So that's not that different than BCG, where I had to sort of help a CEO draw a conclusion on whether to enter a market and the way we went about that was through competitive benchmarking and speaking to other really smart people who sat in competitive companies and would help us to help him figure it out.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“And they want you as well because we're talking about really good people and they're going to learn something. They're going to learn how other funds are set up. They're going to learn how other ideas from these people, right? There may be, let's say it's a long, short equity search. There may be things that the candidates are in that are actually helpful for the founder to know about. If I told you that a search is a portal to meeting the top 15, 20 people in your universe, you would take every one of those meetings. That's a good use of your time.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“It's usually iterative because, again, But your version of who those best three people are maybe different than someone else's part of it is cultural fit. That was my next question. Part of it is just how flexible you as a founder are going to be with respect to giving them. You may say you're going to give them a fair degree of a lot of autonomy, but they may need more than what you're willing to give them. And then there were just nuances. You may say you're open to somebody who runs in a manner that's quite that's concentrated and volatile, but their version of concentration and volatility may be too much for you. So there's a lot of nuances where we, you and I need to iterate on truly who the best quote three are and the way we work is I'm not going to, we're not going to throw 50. We're going to do the work of meeting all the people, but we're going to have you meet, let's call it 15 to 20.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Know someone that they respected another firm. And the common theme is these are people, we're reaching out to people who we view as best in class and talented people tend to recommend other talented people. So we very quickly form a picture of who the best people are. And the other thing, Barry, is just good old-fashioned hard work. When we do a search, any search, we're typically going through maybe two, three hundred people, even though I know the answer is within 10 to 15 of those. We just want to make sure we're leaving no stone unturned and also building our own depth and breadth of knowledge.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“So, what we did is we threw a lasso over the universe sort of as we knew it from when we last left off and when that strategy was last in vogue. And it was a pretty sizable universe. And this was a global search as well, right? Because it's ahead of emerging markets. The person could sit here or could sit in London. And we just dive in. And we build a tapestry of who the best people are, which is both by meeting people that we already know to be good, but even if we have no idea, the reality is we're doing so much work in other areas, whether it's credit, rates, macro. And if we're doing work at a multistrat and we have the credit candidates or the equities candidates in play, they will also have perspective on who is good in EM, right? Whether it's at their firm or they may.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, we've done so much work in every conceivable asset class so many times that when we start something, it's rarely truly brand new. What it can be, because certain strategies are more cyclical than others. So for example, when we did the, here's a good example, when we did the head of emerging markets for one of our clients, he asked me how much work we've done in EM. And I told him we had done a fair bit of work this is going back a few years, but because it's a cyclical strategy, not for a while.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“We kind of know. I'm not going to go so far as to say we have the answer before we begin, although that is often correct, like actually formally begin the search.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“This is a client we've worked with for a long time. I came to him and I said to him there, I see an arb in the market right now. There's a universe of people who are really talented and are staying where they are not because they're happy, but because a better option doesn't exist. And if you created this, I think you could capture that alpha, right? This group of individuals that have been phenomenal P&L generators even in the last few years where it's been very difficult. He's now building that business. So it's both working on discrete assignments for our clients as well as coming to them with advice about where to take their funds forward.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“I started talking with the founder at the end of the summer about a new business. He wants to build. He runs a $40 billion hedge fund, super successful, and he wants to create something wholly other than what he does today. So we're helping him find somebody who could oversee that and build that. That's a very sophisticated person who's not, this isn't someone looking for a job. This is somebody who has actually had great success with what they've done in the past. And this is kind of an interesting maybe chapter two and as successful as they've been, it's an opportunity for even greater wealth creation. The second example I'll give you is another client that is almost as big. And again, these are two of the most successful hedge funds in the world, very forward-thinking guys.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Of inception, of IDW. So, what that means is we really know their business. We've helped them build their business. And yes, they are coming to us for specific assignments, whether it's, and the common thread being they are all senior people who can move the needle, whether it's someone to be a TMT PM for equities, someone to run an emerging markets business, someone to build and run distress. But at the same time, and this goes back perhaps to my BCG background, I really, our role, my firm's role is to also be an advisor to them as well as to the market. So it's, I'll give you two assignments we're working on today and the genesis of it. Each one is arguably for one of the biggest and most sophisticated hedge funds in the world.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“So let me back up and tell you, which I'm actually quite proud of. We've been in business for almost 17 years, 17 this February. Most of our clients we've been working with practically, if not since the beginning, beginning, certainly within the first few years.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Very quickly. And so, and all of a sudden, there's no headwinds from any other part of the bank. There's no cap at all in terms of how you get paid. You can do whatever you want. And if you're an entrepreneurial person who is a great investment professional and that's your passion and that's what you want to do, why be part of a bank? There was no headwind to getting into this business and scaling. If you could produce the goods. And back then, you could do that a lot more easily.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, you know, Within a sell side context, they were doing as well as they possibly could. Back then, you could be a superstar prop trader and earning 20, 30, 40 million bucks a year, which doesn't happen anymore. You could be earning more certainly than the CEO, but their buddies were leaving, many of whom were Goldman partners or just were just. Again, high octane prop traders from Credit Suisse, from Deutsche Bank, from Morgan Stanley, from JP Morgan, and they were setting up shop. And remember back then, you could start with 50 and scale to a billion.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“It had nothing. I was literally just understand. I started a Goldman in the middle of my senior year pen. I mean, because I just was, I don't know, I was stupid. I was like working, I just, I got through all my classes. I didn't have enough fun in college, is the bottom line. It sounds it. I'm making up for it, trying to make up for lost time now. I was finished with my classes. I started middle of my senior year, and I was out within literally a year to HBS. So think about it. I hadn't even graduated from college. So this was, it was, that was not what really jumpstarted my business. What it was, however, you are correct in signaling the sell side as a driver of hedge fund talent because back then it was the prop groups that were the precursors to hedge funds. It was these.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“That's what we were focused on for the cell side clients that I was working with, and that's where the juice was. And all of a sudden, I developed my own business, which was on fire within this big firm. And it just became obvious after a few years to me to really try to do this on my own given I was acting effectively independently within a larger construct, which was having issues at the time.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“So, what happened was after about a year or two there, the dot-com bubble burst. And there, this is this big search for whom I was at. Their financial services practice was really focused more on investment banking, equities, traditional asset management, sort of what I'll call older school businesses compared to what I really fell into and started to focus on, which was back in the late 90s, early 2000s, as you'll remember, these were the fueling the cell side. This is where the action was. It was the prop groups. And it was these new first of their kind type financial products. It was called, so it was credit correlation. Asset swaps wasn't even called credit derivatives back then. Highly structured, first of their kind derivatives-y types of transactions.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“So they had gone to try to start dot com companies. And that wasn't my gig. I realized I didn't really, I'd learned a lot of BCG. I didn't want to be a management consultant as a career path. And I still was figuring out what do I want to do. And before I committed to any particular pathway, I figured I would jump into another milieu where I could learn again more about companies and functions and just figure out where I wanted to commit to. And so I joined a large recruiting firm thinking that would give me a purview. And as it turned out, I was really good at it and I fell into, I quickly joined their financial services practice. And that's how I ended up in recruiting.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“Of MBAs at BCG, the class I entered with was Gonzo. I was literally, they'd all gone to California to seek their, you know, start the next whatever. Give me.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source
“The short answer is I was really young and I was still trying to figure out what I wanted to be when I grew up literally. I had gone to HBS after a year at Goldman. So I literally went from Penn from my dorm room to my parents' home, worked at Goldman for a year, and then went to HBS and just to go back and answer your question, I ended up going to the Boston Consulting Group really because I felt I needed to get a post-MBA to my MBA. I wanted to figure out what path I wanted to take, what sorts of problems I wanted to solve, what industries were interesting to me. And this is in the, I was in my late 20s. This is in the mid 90s. So the dot-com, because that's of course what we called it back then. The dot-com bubble was just bubbling and within a year and a half, my entire class.”
2019-11-22 · Masters in Business · Ilana Weinstein Discusses Hedge Fund Recruitment · IDENTIFIED FROM THE TRANSCRIPT · source