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Kevin O’Leary funds see $500m hit; foes of Dragon’s Den star snicker

Bay Street is a small nook with big egos and long memories. And everyone keeps score, especially when it appears that a titan is headed for a tumble. The bold names down here don't get much bigger than Kevin O'Leary. (Just ask him). Star of CBC's Dragon Den, The Lang & O'Leary Exchange and ABC's Shark Tank, the 57-year-old venture capitalist has built his brand on being a swashbuckling big shot with the Midas touch.

But as Tim Kiladze yesterday reported in the Globe, it seems that some are beginning to tire of his act. Tops on that list may be fellow Bay Streeter Mark McQueen, the president and CEO of Wellington Financial, and himself a noted commentator on all things financial.

On his blog, McQueen wrote:

I've just had a chance to peruse the 2011 financial statements for the various mutual funds and closed end investment vehicles managed by our man Kevin O'Leary, Canada's Rock Star asset gatherer. Across the board, it seems that some investors are starting to walk, briskly, to the exits. By my count, KO's various funds suffered more than $498 million of redemptions in 2011, which works out to be about 24 % of all of the funds under KO management. At that rate, unless he can continue to raise new funds to replace the assets that he's losing, Mr. O'Leary won't have anything left to manage by the time his infamous "Decade of Daddy" comes to an end.

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McQueen, who's now a regular co-host of Business Day on BNN, the all-investing station where O'Leary got his first taste of fame, then follows that up by listing the 10 O'Leary funds that were all hit by multi-million dollar redemptions last year. The biggest being his Convertible Portfolio Trust that kicked off last year with $266-million, only to see nearly 40 per cent of that pulled out by investors by the end of the year.

That still leaves O'Leary with a sizable $1.5-billion under management, though McQueen wonders what it could be driving investors to the door. "It's not like his well-honed shtick changed one iota during that timeframe," he writes, "or that all of these funds went up in value."

It should be noted that McQueen has raised questions about the great O'Leary brand before. Two years ago, McQueen asked in his blog how it is that O'Leary could possibly be touted as a billionaire, noting that his "hairbrained" reality TV claims to have sold a "technology company for billions of dollars" did not exactly square with the reality of the transaction.

So far O'Leary is silent on all of this, somewhat surprising for a guy not known for backing down, much less looking the other way. For now, he appears to be busy with auditions in Los Angeles for season four of the Shark Tank, and promoting last year's 'long-anticipated' memoir "Cold Hard Truth".