Often, quants are building algo’s for the banks/HF they work for and the IP belongs to their employer because they were compensated under “work for hire”.
Assuming the quant created the Algo IP in his own time, and his algo is optimal with $25m USD capital to operate, he would have to partner with a hedge fund if he doesn’t $25m USD. If a quant has IP that belongs to them and partnering with a HF, that is another consideration, does he hand over the algo source code that belongs to him to a partner?
It’s similar to traders and prop firms / trading desks. Some traders don’t have enough capital to exceed the PDT (pattern day trade) capital minimums of $25k or they want access to larger amounts of capital.