One of the most unfortunate hedge fund closures of recent years was that of Scout Capital Management. The well-respected, well-performing New York–based firm shut down in 2014 after Adam Weiss, one of its two founding partners, decided to step back from managing money (though he went on to launch his own fund). The good news from the closure of $6.7 billion Scout was that it resulted in a diaspora of new funds. One of the most exciting is Pacific Grove Capital, founded by Pacific Grove CIO and former Scout partner Jamie Mendola, 38. Though Mendola grew up in Buffalo, New York, and attended Binghamton University in his home state, after working on Wall Street — first in leverage finance at JPMorgan Chase & Co. and then in private equity at JLL Partners — he went to Stanford University for an MBA in management and only briefly looked eastward again. In 2005 Mendola joined San Francisco–based special situations fund Watershed Asset Management as a principal; Scout hired him four years later. Originally based out of New York, covering the retail and financial sectors and developing Scout’s distressed-debt and credit default swap efforts, he played a lead role in opening and managing the firm’s Palo Alto, California, office. When Scout closed, he was well positioned to open Pacific Grove back in San Francisco. Compared with Scout, Pacific Grove, which launched last October, will hold fewer positions and invest mostly in small to midsize companies; this will constrain the fund’s size to about $2 billion. But Mendola, who recognizes the need to focus on the culture and quality of the firm he builds, in addition to investment returns, is happy with that outcome.