John Paulson to Convert Hedge Fund Firm Into a Family Office

Billionaire John Paulson is turning his hedge fund firm into a family office after setting the stage for the conversion last year.

“After considerable reflection and careful thought, Paulson & Co. will convert into a private investment office and return all external investor capital,” he wrote in a letter to investors. A spokeswoman for the firm didn’t immediately provide a comment.

In January 2019, Paulson said he was considering turning the firm into a family office or making it a hybrid business with one part managing his money and another running client capital. At the time, he said as much as 80% of the money his namesake hedge fund ran was his, and that he’d likely make a decision within two years.

His next move came later in 2019 when he segregated most of his personal capital from that of outside investors in his hedge funds, helping to plot a path for the transformation into a family office.

Paulson started his firm in 1994 and built his fortune by betting against the U.S. housing market more than a decade ago. The firm’s assets have slumped in recent years from a peak of $38 billion in 2011 after investment losses and client defections. As of November 2018, the firm ran less than $9 billion.

“With one chapter closing a new one is beginning for me and I look forward to continuing as an active participant in financial markets,” he wrote in the letter.

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