From the Financial News by way of DealBook:

Some investors are deterred by funds that charge fees below the standard scale of 1.5% to 2% management fees and 20% performance fees.

A partner at a multibillion-[dollar] hedge fund manager said some had declined to invest in a new fund it launched because its fees were low: ?They could not take us seriously,? he said.

Just like with many products aimed at the high end of the market, a high price gives a perception of high value regardless of actual ability to deliver that higher value.