Key Takeaways
- • Mike Novogratz is starting a $500 million hedge fund to invest in cryptocurrencies, initial coin offerings and related companies, according to a person familiar with his plans.
- • Novogratz will commit $150 million of his own capital and plans to raise the remaining $350 million by January, mainly from family offices, wealthy individuals and fellow hedge fund managers.
- • Novogratz, a former macro manager who left Fortress Investment Group, publicly characterizes bitcoin as a bubble while still advocating ownership of the asset.
Summary
Mike Novogratz is launching a cryptocurrency-focused hedge fund with a target size of $500 million, Bloomberg reported on September 26, 2017. The fund will invest in cryptocurrencies, initial coin offerings (ICOs) and related companies. According to a person familiar with his plans, Novogratz will contribute $150 million of his own money and intends to raise an additional $350 million by January, drawing primarily from family offices, wealthy individuals and other hedge fund managers.
The launch marks a return to the industry for Novogratz, a macro manager whose tenure at Fortress Investment Group LLC ended in losses. Bloomberg characterized the new vehicle as a comeback, noting that the fund is being positioned as one of the largest dedicated to crypto assets.
Novogratz has publicly described bitcoin as a bubble, while still advising investors to own it. Bloomberg's headline framed his view as predicting that bitcoin would become the biggest bubble ever. The primary source does not provide further detail on fund terms, strategy allocations, or management structure.
The announcement reflects growing institutional interest in digital assets during 2017, a year in which bitcoin's price rose sharply. For allocators, the fund's fundraising base and the manager's stated view of the asset class are the key points to monitor as the January target approaches.
The launch marks a return to the industry for Novogratz, a macro manager whose tenure at Fortress Investment Group LLC ended in losses. Bloomberg characterized the new vehicle as a comeback, noting that the fund is being positioned as one of the largest dedicated to crypto assets.
Novogratz has publicly described bitcoin as a bubble, while still advising investors to own it. Bloomberg's headline framed his view as predicting that bitcoin would become the biggest bubble ever. The primary source does not provide further detail on fund terms, strategy allocations, or management structure.
The announcement reflects growing institutional interest in digital assets during 2017, a year in which bitcoin's price rose sharply. For allocators, the fund's fundraising base and the manager's stated view of the asset class are the key points to monitor as the January target approaches.
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