The world of hedge funds may be about to change, and it’s all thanks to one startup.
Hedgez, a new matchmaking site for hedge funds and investors, wants to bring the two groups together in a unique and intuitive way.
“We decided to build a platform site that would give them the ability to touch and reach prospective investors who were highly screened, highly targeted and highly motivated at a cost which they could never do on their own,” Jeffrey Schwartz, the founder and CEO of Hedgez, told StreetID. “That was the genesis of Hedgez.”
The site is populated with information on more than 6,500 different hedge funds. When a fund elects to participate and a prospective investor visits the site, he or she is asked to fill out a survey. The survey’s results are fed into Hedgez’s algorithm, which determines the five most appropriate investments.
If an investor selects one of the hedge funds in that list, Hedgez will provide a complete profile with the manager’s bio, his picture, his investment strategy, the firm’s history, etc.
“[We provide] everything that any intelligent investor would want to know,” said Schwartz. “At that point, if they’re still interested and they want to hear more, we give them the opportunity — by filling out a registration form — to be contacted or to receive more information on that fund, at which point, with a participating fund, we’ve consummated a transaction and have a prospect lead to deliver to that fund. That’s the basic model.”
To ensure that its users are accredited, Hedgez asks an accreditation question during the survey process. If an investor is not accredited, he or she will be shown other investment opportunities (mutual funds, asset managers, bonds, etc.).
“The one guarantee that we make to the hedge funds is that anyone who makes it to their profile page is 100 percent motivated, 100 percent screened, and self-reported 100 percent accredited,” said Schwartz.
Schwartz also said that Hedgez’s lead-generation capabilities are better and far less expensive than traditional promotional methods. When an investor wants to proceed, hedge funds will be charged $200 for the lead. The fee is lower for mutual funds and other (non-hedge fund) organizations.
Hedgez currently outsources the website’s development work, among other things. But Schwartz said that the site could bring on new talent if and when it expands in 2014.
“We would hire account managers, product managers and some sales support,” said Schwartz.
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