Scott Bessent, who has been George Soros Chief Investment Officer for the last four years and has a long working relationship with the legendary progressive billionaire, plans to depart from the Soros family firm at year end to launch his own hedge-fund firm.
Based on a company memo distributed on Tuesday to employees of Soros Fund Management, Bessent is leaving to establish Key Square Group with a $2 billion investment from Soros.
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In the memo, Robert Soros, the deputy chairman of the $30 billion Soros family office, provided an explanation for why Bessent was moving on.
He commented: “Over the past four years, Scott has managed the firm’s assets with skill and dedication. He has decided to start his own venture because of the constraints involved in working within a family office structure, which prevent him from raising outside capital.”
Analysts point out that Bessent worked for Soros for several years in the 1990s, then returned in 2011 after managing his own fund for close to 10 years.
Bessent was an analyst for Soros in 1992, and was employed in London when Soros made his well-known (and very profitable) bet against the British pound. That historical trade, which forced the UK out of the Euro exchange system, earned the billionaire the title of “the man who broke the Bank of England”.
The position of CIO was created for Bessent in 2011, and the memo noted that SFM is not planning to replace Bessent’s position for now.
The memo went on to note that the firm’s investment strategy and asset allocation is to be undertaken by two already existing committees that have an active role in both processes.
Given changing regulations and tax laws, Soros was one of several veteran hedge fund managers who returned outside money to their investors and set up family offices in 2011. Financial experts point out that family offices have less of a regulatory burden than public fund structures, especially regarding disclosure and compliance requirements.
The news was reported earlier Tuesday by Katherine Burton of Bloomberg.