There are a number of reasons why investment managers choose to start a hedge fund. Refugees from larger, mainstream investment organizations often look to hedge funds as a means of practicing their investment craft in a “pure” setting. Leaving behind the bureaucracy of a larger organization can be liberating in both a professional (and personal) sense.

Given the flood of stories recently on hedge funds one has to wonder whether the allure of running a hedge fund has dimmed at all? As the minimum size of hedge fund start-ups has grown over time the marketing requirements have increased as well. With this publicity and higher profile comes the potential for negative press.

Not only is the press more interested now than ever in the inner workings of hedge fund operations, but so is the government. DealBook reports on the growing unease in Washington with the “unregulated” nature of hedge funds. Whether this interest is genuine or simply for the benefits of the cameras is unknown, but Congress remains interested in further hedge fund disclosure.

The chairman of the Senate Finance Commitee, Charles Grassley, believes that hedge funds pose too much risk to the nation’s pension system and on Monday asked the Treasury Secretary, Henry M. Paulson Jr., to find a way to make their operations more transparent.

Not only is the government breathing down the collective neck of hedge funds, but the Wall Street Journal today has (at least) three stories on the goings on in hedge fund land. Given the increased size and stature of the industry this is understandable, but we doubt that the given managers mentioned in this articles have much desire to be fodder in the country’s top business newspaper. For example:

Henny Sender discusses the uneasy working alliance between debt-focused hedge funds and the private equity firms who issue ample amounts of debt. While the relationship remains a useful one for both at the moment, the risk that an economic slowdown and rise in defaults could derail this mutually beneficial relationship.

Gregory Zuckerman and Alistair MacDonald discuss the rapid assent and (equally) rapid descent of Vega Asset Management. A particularly poor year in 2006 has set off a wave of redemptions that have shrunk the firm’s asset base. The only question that remains is whether the firm can survive this episode intact.

Scott Patterson reports on how one hedge fund firm, Ritchie Capital Management, that has survived an investor revolt. Ritchie has been able to restructure their hedge fund on the fly in the face of investor opposition to a change in investment strategy. At least not every story has to end badly, we guess.

Before the press was paying attention hedge funds went in and out of business on a regular basis. The difference now is that this news is publicly available and prominently featured. One of the benefits of a hedge fund structure was that it allowed the manager the time and flexibility to best implement his or her given investment strategy. Given the increasing pressure from clients and the press alike it will be interesting to see if hedge funds will continue to be a preferred destination for risk capital.