It may not have received the level of publicity that many financial services professionals would have expected, but the lifting of an 80-year old ban on hedge fund advertising marks an intriguing moment in the evolution of the investment vehicle.

According to Reuters, hedge funds and other private equity funds are now allowed to reach out directly to investors through the usual means of media communication after legislation detailed in the 2012 Jumpstart Our Business Startups Act came into effect on September 23. The decision to allow investment vehicles to, in effect, open their doors to consumers and have their goods or services associated with branded events such as sports tournaments has been welcomed by the financial sector, and it could mean a change of direction in terms of hiring strategies in the financial services industry.

To the outside world, hedge funds have always seemed to be operating on a higher financial level with the average citizen or retail investors excluded from participation. This has allowed the industry to operate with a certain degree of anonymity in terms of sourcing and attracting talent, with hedge fund managers almost able to pick and choose who they wanted to join their team.

Investment in people
On the whole, traders, analysts and experienced portfolio managers were brought in to fill any gaps, while companies were also able to pick and choose from the thousands of resumes that arrived from recent graduates and potential Wall Street legends.

In recent years, however, the financial sector has seen a slew of regulatory restrictions imposed at the federal level, and while the perception has been that hedge funds are somewhat of a closed shop, those who know how efficiently the system can work are prized assets at nearly every current and potential investment vehicle. At the same time, there has been a growing understanding of how essential the industry can be in terms of maintaining the stability of the national economy, especially as the effects of landmark legislation such as the Dodd-Frank Wall Street Reform and Consumer Protection Act came into play.

“As a result, hedge fund managers have begun looking to hire people who would take on more of a business development role within the industry,” explains Mitchell Peskin, Partner and Executive Vice President of The Execu|Search Group’s Financial Services practice area. “For our buy-side clients, strong areas of focus include: marketing, compliance, investor relations, and fundraising. Of these 4 areas, we are specifically observing that there is a premium for fundraisers who have both a sound technical knowledge of the instruments or asset classes involved and the commercial opportunities available to that fund.”

While the landscape of the industry has changed, the need for talent remains the same. Hedge fund managers know the value of investment, so their investment in talent will continue to be paramount, especially as efforts to attract stakeholders continue to become more public.