Re: Friend in Early 20's Lucked into hedge fund space, needs advice
Finding either a family office or small HF to intern at would be his best first step. Is he starting from scratch on the operational aspects of the business? Legal structure, tax, brokerage relationships, software/hardware, reporting, etc. are all things he will need to consider and these will take time to build out. You can't just go in day 1 and start investing. If he's only around $10mm in AUM then its going to be extremely hard to cover expenses much less make a profit of any sort regardless of his ability and the market.
I'm not convinced this family knows anything about the industry if they're giving ~$10mm to a 22 year old with no experience and expecting that to launch a family office unless they are expecting to spend down these assets in the setup process and they have substantial other wealth that they will be investing at a later date. The scale is just far too small (by an order of magnitude).
Also, there is nothing about this AUM size that suggests you need to be a small/micro cap investor. Small/micro cap funds are small out of necessity due to the opportunity set, but a small fund doesn't have to be constrained to those spaces.