Crossover Hedge Funds Lost Big in 2022. They’re Still Launching in 2023.

Hedge funds investing in fast-growing public and private companies lost tens of billions of clients’ money last year. That isn’t stopping more “crossover” funds from launching.

Mala Gaonkar, 53 years old, a former co-investment chief of Lone Pine Capital LLC, launched her New York-based crossover fund, SurgoCap Partners, on Jan. 3 with $1.8 billion, people familiar with her firm said. Ms. Gaonkar’s launch was widely anticipated given her experience and marks the largest-ever startup from a female hedge-fund manager. Lone Pine, which Ms. Gaonkar left roughly a year ago, lost 36% in 2022 in its flagship hedge fund.