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Get Seed Funding for Your Fund
We write seed checks for emerging hedge fund and private equity managers, from pre-launch through first close, and help you find the right anchor investors.
How do emerging hedge fund managers get seed capital?
Emerging hedge fund managers that raise seed capital usually get it from a specialist seed investor that puts in day-one capital for a share of the manager's business. The usual price is 15 to 25 percent of the management company's gross revenue (Tannenbaum Helpern), and the seed capital is typically locked in for two to three years (Seward & Kissel, 2026). We review applications seeking $1 million or more.
Seed capital by strategy
Long/short equity
The short book, gross and net discipline, crowding, and prime broker terms.
Credit and private credit
Valuation policy, independent pricing, and liquidity terms set by the slowest asset.
Quantitative and systematic
Backtest overfitting, model change control, capacity, and data costs and provenance.
First-time private equity fund
Track record attribution, the GP commitment, the fundraising clock, and first close mechanics.
Special situations and event-driven
Liquidity mismatch, downside correlation, legal and process risk, and information controls.
Seed deal terms in numbers
15 to 25 percent
The share of the management company's gross revenue a seed investor typically takes, often with a slice of carried interest on top (Tannenbaum Helpern).
10 to 25 percent
The economic interest in the management company a seeder commonly holds (GCM Grosvenor, 2023).
87 to 96 percent
The share of seed deals in each year from 2014 to 2018 that were structured as a revenue share rather than direct equity, 91 percent in 2018 (Seward & Kissel 2014 to 2018 study).
Three years
The lockup in half of 2023 seed deals, up from about 10 percent of deals in 2018. Two years used to be the norm (Seward & Kissel, 2023).
Five times
The most common formula buyout price: five times the seeder's trailing 12, 24 or 36 months of payments. An explicit buyout right appeared in fewer than half of deals (Seward & Kissel 2014 to 2018 study).
Questions
What is hedge fund seed capital?
Seed capital is an early allocation to a new fund, usually made before launch or at first close, in exchange for a share of the manager’s economics such as a revenue share, reduced fees or capacity rights. Our research on what a hedge fund seed deal actually costs covers typical terms.
Can I apply before my fund launches?
Yes. We work with managers from pre-launch through first close. If you have not launched, enter 0 for current AUM on the application.
What do I need to apply?
Your name and firm, a two- or three-sentence investment thesis, the amount of seed capital you are seeking, your current AUM, an email address, and your pitch deck as a PDF of up to 10MB. Send the deck you would send to an LP.
How long do seed investors lock up their capital?
Two years was the standard in Seward & Kissel's 2014 to 2018 data. In its 2023 study, half of seed deals had three-year lockups. Many deals also let the seeder leave early if the fund falls by a set amount. In the earlier data, about half of those triggers were set at a fall of 15 percent or less.
Can I apply while I am still at another fund?
Yes. Portfolio managers often apply before they resign. Our page on launching your own fund covers what to check in your employment agreement first.
Last updated: November 2026. Figures come from the linked studies and describe the market, not any single deal. General information, not investment, legal or tax advice.
Further reading: What a hedge fund seed deal actually costs, with sourced figures on revenue share, lockups and buyouts.
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