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May 17, 2017  

Gelband Seen Hiring Unprecedented Numbers

Though still months away from launching a planned multi-strategy fund, Michael Gelband is aggressively hiring investment and operations professionals with the goal of having an unusually large staff in place on day one.

Sources said Gelband and partner Hyung Lee, previously top executives at Millennium Management, anticipate hiring as many as 75 people, including 10 portfolio managers, in the coming months. Perhaps never before has a hedge fund startup sought to hire so many people at such an early stage.

Meanwhile, Gelband and Lee have begun talking to investors with an eye toward launching a fund late this year or early next year from their yet-to-be-named New York firm. Given their roles at Millennium — Gelband ran fixed-income trading while Lee oversaw equity trading — they’re expected to raise a huge amount of day-one capital. There have been rumors, for example, that George Soros was considering a $2 billion commitment, though sources familiar with his operation said that isn’t true.

There’s speculation that some senior portfolio managers will soon be leaving Millennium to join their former colleagues.

By their nature, multi-strategy fund operations tend to be heavy on staff. Millennium, which pioneered the business model and now runs $35 billion, has a headcount of 2,140 — the largest in the industry. But most hedge fund startups, even multi-strategy shops, rarely start out with more than a couple dozen employees. In recent years, Folger Hill Asset Management assembled one of the largest day-one staffs, launching in 2015 with nearly 30 employees. The firm, led by former SAC Capital executive Sol Kumin, has since shrunk amid poor performance.

Gelband left Millennium last month after nine years on board. In the end, he was overseeing about 45 portfolio managers who trade bonds and credit derivatives. Prior to joining Millennium, he was global head of fixed income at Lehman Brothers. One source said Gelband’s roles at both Millennium and Lehman give him a distinct advantage when it comes to recruiting. “He has a huge Lehman Brothers network that is all over the Street,” the source said.

Lee, who left Millennium late last year, had responsibility for more than 100 equity portfolio managers.

CORRECTION (5/24/17) This article has been revised. The original version incorrectly reported that a multi-strategy startup led by former Millennium Management executives Michael Gelband and Hyung Lee has hired several junior portfolio managers from Millennium. No portfolio managers have left Millennium to join the new firm. The article also incorrectly reported that former Millennium operations executive Patrick Tynan had been hired by Gelband and Lee. And it incorrectly reported the hiring of operations professional Enrico Corsalini from Millennium. While Corsalini has given notice at Millennium, he is still employed by the firm.