Behind the Money
Inside a hedge fund disaster
Nov 29, 2023
Dan Och, hedge fund manager, discusses the saga of his hedge fund's decline and the bribery scandal. The podcast explores the risks of relying on a few talented individuals, the strained mentor-protege relationship, and the eventual sale of the fund. It also delves into negotiations, the challenges of transitioning beyond the founder, and the differences between hedge funds and private equity firms.
21:19
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Quick takeaways
- Dan Och's decision to take his hedge fund public in 2007 aimed to ensure its long-term success as an institution, but challenges of operating as a publicly traded hedge fund worked against him.
- A bribery scandal and a strained relationship with star trader Jimmy Levin contributed to the decline of Auk Ziff, highlighting the difficulties hedge funds face in transitioning beyond their founders' leadership.
Deep dives
Hedge Fund Manager's Unusual Move to Go Public
In 2007, hedge fund manager Dan Auk made a surprising move by listing his firm, Auk Ziff, on the stock market. This decision to go public was uncommon in an industry known for its secrecy and lack of transparency. Going public meant increased scrutiny from investors, regulators, and the media. The move was driven by Auk's desire to ensure the longevity of his hedge fund beyond his own career and to turn the business into an institution. However, over time, Auk's plan to institutionalize the firm and the challenges of operating as a publicly traded hedge fund seemed to work against him.
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