Launching your fund on the proper platform

So you want to manage assets - make sure you have strong support

So you are thinking of starting a hedge fund. You are not alone.

More than 800 new funds launched globally in 2013, including 71 in Asia.

Clearly, in spite of mounting regulatory barriers, the idea of launching and running a fund still has a lot of appeal.

Now, you face a crucial decision.

Should you try and launch a fund on your own or should you sign on with an established asset management platform?

Joining an asset management platform may make more sense for a startup fund than trying to go it alone.

The costs of creating a legal entity and building the infrastructure to support a fund - licensing, attorneys' fees, compliance, technology, office space, staff - can add up quickly.

Many market professionals believe a new hedge fund needs to raise about $50 million to break even. With an established platform, you could be up and running with as little as $5 million to $10 million.

Economics, however, are only one factor.

Even if you have enough capital, the platform route allows you to focus on investing and leave the administrative tasks to the experts.

Time spent on administration is time spent away from what really matters: namely, identifying opportunities, raising money and investing it effectively.

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