In early May 2011, the world lost a giant. Christophe Arroyo was one of the most remarkable men I’ve ever met. When he died suddenly at 39 while running a marathon, he left behind a beautiful, devoted wife and two wonderful, happy children. He also left behind family, friends and colleagues who will remember him forever as a stunning example of what a person can be at their best. Christophe was, simply, the most loving, hardest working, most resilient man I ever knew. His presence was so forceful, so powerful, he remains an inspiration to this day.
Christophe was a brilliant hedge fund manager. Leaders in finance would be wise to learn from his example. He was one of a kind. Filled with passion for his family and career, Christophe embraced every moment of every day as if it were his last. He was dynamic, animated and driven. He literally shined and pressed forward toward you across the table, excited to discuss the future and how he was going to shape it. Every conversation began and ended with family, which was the most important thing to him. Still, in between, there was a spirited discussion about business, and I always came away enlightened and inspired.
In the Russell Crowe version of Robin Hood, there’s a part that reminds me of Christophe (though he might not appreciate the reference as the French are villainized in the film). Nevertheless, in recalling his childhood, Robin Hood remembers his father’s mantra: Rise and rise again until lambs become lions. Asked by his friend to explain, Robin says, It means never give up. That is Christophe. He never wavered. Even in the depths of the 2008 financial crisis when committed investors backed out and his portfolio whipped around, he never gave up.
Preqin estimates that of the 5,000 hedge funds in the world, 570 manage 92% of the $3.2 trillion in industry assets. Small firms struggle to raise capital, recruit people and build a business. They face a classic Catch-22 and hear from investors the same replies over and over again: Come back when you’re at $100 million; come back when you’re at $250 million; let me know when you have a one-year track record; tell me when it’s been two years. In a prior generation, people said no CFO ever got fired for hiring Goldman Sachs as their banker. Today, no asset allocator gets fired for picking one of the supertanker funds, though some of the largest firms struggle to generate performance. Those that do benefit from a diversified structure, offering portfolio managers the opportunity to rise and providing investors with multiple products. They manage several funds on a platform with shared infrastructure, tax, accounting and marketing.
Portfolio managers who have left banks and big funds to start their own firm soon discovered the difference between managing a portfolio and running a business. If you’re going to do this, do it right.
Do it like Christophe
1. Be relentless and resilient. Dig deep and remain tenacious, gritty and diligent. Push ahead no matter what
2. Be optimistic, upbeat, energetic, positive and forward-looking. Believe in yourself, rely on your talent and trust your team
3. Don’t be a jerk. Christophe was kind. It’s not weak to be kind. Stay authentic, humble and down to earth. This business is filled with especially discerning people. They will sense pretense from a mile away. Be genuine and self-aware. Don’t be that finance guy. No one likes him, including his wife, family, friends, colleagues and investors. Really. When there’s a hiccup, instead of support, the people around him vanish and the knives come out. You know who I’m talking about
4. Don’t be a pushover. Demand accountability. Insist upon intellectual honesty from everyone, including yourself
5. Be daring, driven and courageous. Be fearless in the face of adversity, doubt and anxiety. Fear is toxic, debilitating, exhausting and contagious. It will spread in your firm and drag you all down. Everyone has doubts. Don’t run from them. Turn around and face them. Acknowledge your uncertainty. Embrace your fears so you can master and overcome them. Don’t give into the temptation of self-loathing
6. Keep your head down. Don’t listen when the guys who run big firms tell you there’s no room for a new fund. This business is fundamentally entrepreneurial. They started their firms at some point, right? Whether or not they realize it, they’re threatened by your energy to disrupt and envious of your enthusiasm for the road ahead
7. Be generous and gracious. Christophe never said, I told you so, even though he often had. Give others credit. It’s your firm. It’s free to you and important to your colleagues that they share in the glory
8. Be thoughtful and thorough. Christophe knew every detail, fact, figure and name involved in his investments. He knew where the CEOs went to school and who their lifelong rivals were. There’s a lot of color to each investment and you need to grasp it all. Christophe had conviction but he was not stubborn. He was open to other perspectives and new information
9. Laugh. Christophe was hilarious and saw irony and humor in situations. It’s healthy to enjoy a moment of levity, especially in such a demanding, exacting, exasperating line of work
10. Go for it. Don’t wait. The time is now, right now
Rise and rise again
Life is short. But careers are long. It’s hard to fathom Christophe is gone, yet he is a model for everyone who wants to live a meaningful, purposeful life. Chase your dream today, beginning immediately. Be the man you can be. Be the woman you should be. Be the person you dream of being at your best, whom you want your kids to respect, tell their friends about and be proud of. Rise and rise again. Until lambs become lions.