Hedge funds are launching leaner and faster than ever, opening a new path for portfolio managers

"Leaner, faster launches like Bayhunt's are one of the knock-on effects of the booming popularity of separately managed accounts. As allocators increasingly lean into SMAs for the transparency and control they provide, managers have been able to launch with a smaller headcount - and in some cases, without a commingled fund at all."

"At the same time, cloud-based tech systems and outsourced service providers have made it possible to rent much of the infrastructure that used to require an in-house build. Hedge funds, which have had a generational run of returns in recent years, are now the clear favorite among investors."

The hedge fund industry has undergone significant structural changes enabling individual portfolio managers to launch firms without traditional back-office infrastructure. Ben Williams exemplifies this trend, founding Bayhunt Capital in 2024 as a solo operator managing $360 million in real estate stocks through separately managed accounts. This shift stems from multiple factors: the growing popularity of SMAs among allocators seeking transparency and control, cloud-based technology platforms reducing infrastructure costs, and outsourced service providers eliminating the need for in-house teams. Historically, institutional investors required substantial back offices and expensive technology systems before committing capital. Today's leaner model allows experienced managers to launch independently with minimal headcount, fundamentally transforming how hedge funds establish themselves.

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