July 21, 2010 / 10:56 PM / 8 years ago

Tiger's Robertson may be ready to start new venture

* Robertson may be ready to start a new venture

* May take outsiders’ money for first time in a decade

* Hires new operations chief, promotes son

By Svea Herbst-Bayliss

BOSTON, July 21 (Reuters) - Julian Robertson, a pioneer in the hedge fund industry, is banking on his legendary cachet to attract new investors if the Tiger Management LLC fund is let loose to growl for a second time.

Robertson, 78, closed his fund and gave his investors their money back a decade ago, after delivering annual returns of about 30 percent in a fund that peaked at $22 billion in 1998.

Now he is mulling a comeback of sorts. Not as a stock picker, but as a nurturer of talent, expanding on a role Robertson has played over the past decade.

Robertson has grown what has been called the $1.6 trillion hedge fund industry’s biggest family tree, helping to start more than three dozen hedge fund firms.

By doling out some of his personal fortune, the veteran has has helped launch the careers of several industry stars including Andreas Halvorsen, Stephen Mandel, Lee Ainslie, Chris Shumway and Chase Coleman.

The Wall Street Journal reported on Wednesday that Robertson might want to expand Tiger by creating a “seeding fund or a fund of hedge funds for outside investors.”

Within months, outsiders such as wealthy individuals and pension funds might be given a chance to invest alongside with Robertson as he makes his bets on newcomers, said people familiar with his New York-based firm’s plans.

Robertson recently tapped former Goldman Sachs executive John Townsend as his operations chief and promoted his youngest son, Alex, to managing partner.

A spokesman for the firm said the threesome will work together to figure out what direction Tiger wants to go in and stressed that no final decisions have been reached.

BETTING ON THE RIGHT TALENT

While the prospect of investing alongside Robertson might appeal to many, skeptics wonder whether conditions are right for the North Carolina native to pick the right talent.

“He established his record in a very different time,” said Chris Tobe, a senior consultant at Breidenbach Capital Consulting, which puts money with hedge funds. “His skill set was tested then and who knows how he would do now?”

Still, Robertson’s name alone is sure to bring many seasoned investors to the table for a closer look.

“I would go long Julian,” said Michael Hennessy, a managing partner Morgan Creek Capital Management. “He will continue to do what he’s been doing with great success.”

Robertson’s own investing success came as a stock picker. His “Tiger Cubs” have mostly been stock pickers as well, leaving some to wonder how he would fare in choosing investing talent whose focus lies elsewhere, such as in fixed income or event driven strategies.

Some of Robertson’s successful proteges have fallen on tough times in the last months with sluggish returns.

While hedge funds, om average, lost 1.45 percent in the first half of 2010, Halvorsen’s Viking Global Investors fund lost 5 percent through June. Chris Shumway’s smaller Sakonnet fund dipped 5.4 percent in June alone and is now off 9.8 percent for the year, and Tiger Global dipped 3.5 percent in the first six months of 2010, people familiar with the numbers said

Some investors have also not failed to notice that many of the Cub pack, especially those based at 101 Park Avenue in Manhattan, where Robertson has his own office, often play very similar stocks.

GREY POWER

Robertson is far from the only elder statesman in the financial industry.

Warren Buffett turns 80 next month, Carl Icahn is 74, T. Boone Pickens, 82, still runs his hedge fund, and Edward C. “Ned” Johnson recently celebrated his 80th birthday in June at the helm of mutual fund firm Fidelity Investments.

Still, some potential investors wonder exactly how much time Robertson will devote to the new venture.

In recent years Robertson has, among other things, developed luxury golf courses and invested in wineries in New Zealand, and he is an active philanthropist.

“What percentage of his time will he be spending in the office is a reasonable question,” said Tobe.

Still, the dazzling returns of the past and Robertson’s name recognition will be a definite selling point.

“As long as returns in the last years haven’t been disastrous for him, I imagine investors will be lining up at the door to get in,” said Sol Waksman, who founded BarclayHedge, a firm that tracks hedge funds. (Reporting by Svea Herbst-Bayliss; Editing by Richard Chang and Steve Orlofsky)

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