The Times reviews Hedgestock:
www.timesonline.co.uk/article/0,,8159-2216747,00.html
Selling themselves short
Penny Wark
Hedge fund managers are the new Masters of the
Universe. So what are they really like? Very clever,
very rich - and really very dull
It has to be said that Pete Townshend and Roger
Daltrey are doing their best. Townshend is pogoing
like a three-year-old in need of Ritalin and Daltrey
is hurling his microphone into improbable arcs and
catching it every time. And the audience? Are they
moving in a demonic frenzy, a look of blissed-out
rapture on their sweaty faces as they yell every word
of every familiar song? Er, no.
So they're not rocking, even though they are watching
The Who's first concert since Live Aid? Afraid not.
Aren't they a little bit excited to be in a field on a
summer's evening at Knebworth, fabled home of so many
classic rock concerts? If they are, you wouldn't know.
I've seen more passion on a Friday night in Waitrose.
It's true that after an hour of Townshend and Daltrey
stoking them up with classics such as My Generation,
the people near the front started to clap. "Have you
lot been drinking all day?" asks Daltrey, with
delicious irony.
Some of them are moving their neat hips from side to
side. Click, click, just like that. But, frankly, if
it wasn't for the stage and the jolly garlands draped
over expensive shirts, you might imagine you're at a
convention for City folk.
Welcome to Hedgestock. You may remember Woodstock —
three days of peace, love and music back in the days
when hippies were cool and half a million people
swarmed into a field at a dairy farm in Bethel, New
York. It was the self-indulgent summer of '69 when
everything was free, nothing naughty was off limits
and no one, least of all the hippies, was counting the
cost of anything. The Who were there, of course they
were.
Fast-forward 37 years and Townshend and Daltrey are in
remarkably good nick considering, but now they are
playing to a sober crowd of hedge fund managers and
their associates at an event designed to loosen them
up, break down their reserve, help them to get to know
each other.
As the brochure puts it wittily, this is "two days of
peace and love", which is perhaps why most of them
have undone a shirt button and bought a beer. One man,
dressed with the icy cool of Jay Gatsby, is sitting on
a deckchair, daringly licking an ice-cream cone, his
laptop at his feet. Everyone still has their mobile
phone on and even Daltrey's belting lyrics don't stop
them taking calls. Eventually Townshend loses it.
"Turn yer mobiles off!" he yells. There is no
noticeable response.
"As an industry we have to face it, we're not
particularly loved," the brochure continues. "The
establishment misunderstand us. Corporates think we're
promiscuous. Regulators wish they had the power to
ground us. No wonder the Summer of Love has a certain
resonance!"
I don't know quite what this means, but then I don't
know what a hedge fund is, either, and that is part of
the problem. Few outside the City understand what
these people do. All we know is that they are very,
very rich and that Tom Wolfe has described them as the
most likely modern-day candidates to replace his 1980s
Masters of the Universe from The Bonfire of the
Vanities. My editor tells me that they rule the world,
which makes me nervous because I am wearing my Matalan
cardigan. I hope they won't think that I'm being
disrespectful.
In the car park I clock a Ferrari, a Bentley and a
galaxy of Porsches, BMWs and Mercedes. So far, so
predictable. A semicircle of elevated marquees and
buses painted in corporate colours faces the stage,
all filled with elegant people. They have glasses in
their hands but they are still and distant in their
manner. Perhaps they are worn out after a day of
intense debate? Cheekily, JP Morgan offered a
presentation called "In sourcing, Out sourcing — how
saucy are you?" and someone else offered a debate
"Esoterica — new risks and new returns for consulting
adults".
I look around for some promiscuity and spot a couple
kissing a bit near the back. But apart from the fact
that they are not being promiscuous, they're not hedge
fund people, either — they are teenagers representing
the Teenage Cancer Trust, the charity that will
benefit from The Who's generosity in performing for
free.
How much has been raised is not yet known, though
individuals could attend the two days for £500 plus
VAT. Most of the money came from the sponsors and it's
a lot, everyone says confidently: "This is what it's
all about, you've got to put something back."
Which is jolly decent of them. But I doubt that 4,000
of the country's brightest and most intensely
competitive Type As would have gathered here just to
donate to a worthy cause. In truth, this is what they
call a "focused event" — they are here to network, to
meet clients, to drum up more business, to make even
more money. This is why their faces remain impassive,
their drinks barely touched. Even the man on the baked
potato stall is handing out business cards.
When a man from the Teenage Cancer Trust reads a
letter from a young girl who was invited to the
concert but died last week, you might expect some
reaction. She had asked him not to read the letter
until he was on stage, he explains, and he doesn't
know what it says. It is indeed a wrenchingly powerful
letter and there is applause but no change in
expression. These guys are winners, you understand,
and they are here to work.
I introduce myself to a hedge fund manager called
Adrian. He has a square haircut and an intensely
serious manner like Ben from The Graduate. I can't
help wondering whether he needs a Mrs Robinson to show
him how to relax. What does a hedge fund manager do, I
ask, but he replies in City jargon that I can't
decipher. He is 28, I learn, and has had his Porsche
for years.
What else does he do for fun? "Golf, some shooting,
drive a car on the track."
Of course, competitive stuff. That's why this event is
also full of polo, cricket, clay pigeon shooting and
even table football, so as the hedge fund managers
regrouped yesterday morning it was networking that
seemed uppermost in their minds. Someone had found
time to buy a Bentley, "the answer, my friend, is
blowing in the wind" was blasting through the speakers
and some of the delegates were still wearing their
jeans and daring shirts, but the faces remained closed
and remote.
I find myself taken into a marquee, where two smooth
and impenetrable gentlemen explain patiently that
hedge fund managers operate by taking advantage of
falling markets as well as those that rise. It sounds
like gambling to me, but even I know not to use that
word here. Typical profits, they explain, are a 2 per
cent management fee plus a 20 per cent performance fee
on the return. The minimum investment is around
£100,000, the maximum billions, and most investors are
institutions. Pounds or dollars? "Either way it's a
lot of money."
Thirty to 40 per cent of the funds fail, they say,
"but you don't hear about that. This business attracts
people who want to work outside the restrictions that
apply to banking."
Mavericks? The shutters have come down again. "There
used to be. Not now."
These people — they are mainly men — remind me of the
Su Doku fanatics I encountered at the world
championships in Italy a couple of months ago: perfect
corporate manners, absolute control and too serious to
engage. Driven, yes. Fiercely intelligent, certainly.
Though when you focus all that intelligence on one
abstract area, it can make a person seem to lack
empathy.
At Knebworth I meet two exceptions. The first is a
hedge fund manager who kindly explains that he can't
talk on the record because he'll be killed —
professionally, he means. But the reason why his
industry is so closed and so often accused of being
secretive is that they have to work according to
strict regulations and cannot be seen to solicit
business. So they can attend a convention full of
prospective clients because these people are
accredited investors, but putting their wares on the
table for a Times feature writer is out.
The second is Len Gayler, managing director of Cayenne
Asset Management Limited, whom I have spotted bounding
around to the Who — he is one of very few in the
audience who actually rock, possibly because at 54 he
remembers the music.
"The motto of these people is work hard, play harder,"
he maintains. But then he corrects himself. "Actually
it depends. Some of them play hard but it's the
minority who spray champagne around nightclubs. Some
of them are at their desks for 18 hours a day, never
off the phone or the internet. But if you work under
that kind of pressure for long enough you need to have
a release valve. For some it is opera, and when the
curtain comes down they go back to the office. People
come off the night flight from New York, go to the
office in London, clothes are delivered, they do eight
hours and then go to Tokyo.
"It's capitalism at its best because those who start
up hedge funds have the chance to make money out of
their own blood, sweat and tears, and being clever and
using their brains. They are creative but most of all
they have the drive to succeed. It's not about the
money. We want to win."
Gayler's release valves are fast cars, going to rock
concerts and raising money for the Teenage Cancer
Trust of which he is a patron. Have I been to a
teenage cancer ward, he asks. I haven't. "It fills me
up," he says. "We are really lucky and that's what
this is about." His eyes are watering: at last, a
hedge fund manager who is a human being. Respect, Mr
Gayler. Respect.
