Former Illinois Democratic gubernatorial candidate and White House chief of staff Bill Daley has joined a Swiss hedge fund, Argentiere Capital, as a managing partner and head of U.S. operations but will remain based in Chicago.
Daley, 65, said in an interview that he wanted the opportunity to work at a startup, and that he "hit it off" with Argentiere founder Deepak Gulati, who is in his mid-30s and the former head of global equity proprietary trading at JPMorgan Chase & Co., Daley's former employer.
"Everything I've done has been at big firms, big law firms, government," Daley said. "This is my first startup. I wanted the chance to be a part of something that will grow."
Argentiere launched in June. Gulati was one of many star proprietary traders who left banks to form their own hedge funds in response to the so-called Volcker Rule, which prevents banks from making several kinds of risky bets with their own money and federally insured deposits.
Bloomberg reported that Argentiere, based in Zug, Switzerland, and named after a skiing village in the French Alps, would focus on volatility trades, or betting on the rate at which stocks rise or fall. Gulati was based in Zurich when he worked for JPMorgan, the bank Daley worked for before becoming President Barack Obama's chief of staff for one year.
After stepping down as chief of staff, Daley, the former U.S. commerce secretary under President Bill Clinton, and the son and brother of former Chicago mayors, began mounting a campaign for Illinois governor. He abruptly called off his bid in September, telling the Tribune that he wasn't prepared for "the enormity of it."
Daley said he had his first conversation with Gulati, brokered by a former JPMorgan colleague, in January.
"A lot of hotshot traders have left banks and gone and started hedge funds," Daley said. "But this was the whole team that left together. … One uniqueness, if not the most important thing about Argentiere, is that the traders have all been working together and stayed together. They haven't had to build a new team … which is a tough thing to make mesh."
A source told the Tribune that the hedge fund had raised $500 million. But the only publicly available U.S. filing related to fundraising, released in June, reported that Argentiere Fund LP, whose principal place of business was a post office box in the Cayman Islands, had raised about $76.3 million. Zug, which is one of 26 Swiss cantons, or states, has among the lowest taxes in Switzerland.
Daley declined to disclose how much Argentiere had raised but said he would be working on fundraising as well as providing insight into government and economic policy.
"These funds are more affected by government action and inaction today than lots of other things," he said.