David Friezo was the Managing Principal and Founder of Lydian Asset Management (LAM), a $3.5+ billion Convertible Arbitrage & HY Credit hedge fund based in Westport, CT for over thirteen years. Prior to LAM, David was a partner at Bankers Trust. When he wound down the fund in 2012, David brought his money back onshore and formed the Frisa Family Office (“FFO”). The objective of the FFO is to invest in a tax efficient manner across a number of asset classes including Private Equity, Hedge Funds, Traditional Assets, and Real Estate along with a focus on Philanthropic and generational needs.
While exhaustively exploring different vehicles to reinvest the family office wealth in a tax efficient structure, David identified that using Insurance Dedicated Funds (IDF’s), including Private Placement Variable Annuities (PPVA’s) and Private Placement Variable Life (PPLI), was the most efficient and flexible structure to fund his family office goals. The IDF structure gives the investor the ability to generate alpha by mitigating taxes. Minimal set-up costs and ease of execution makes the IDF structure extremely attractive. The major issue the FFO encountered when studying the IDF market was the lack of high quality funds on the insurance carrier platforms. After speaking with several insurance carriers, the FFO initially seeded two IDF managers and has been investing in several other new IDF’s that meet the investment criteria. The FFO believes this should be the preferred structure for onshore taxable LP’s such as Ultra High Net Worth Individuals and Family Offices to invest in hedge funds.