ReThink Recruitment, an IT staffing firm, stated that it had placed a number of IT professionals at start up hedge funds and these enterprises were seeing more interest from technology staff than large banks.
According to the business, technology professionals were receiving a basic salary between Â£80,000 and Â£100,000 as well as a guaranteed 100 per cent bonus at the funds.
The figure is twice as much as previous levels of pay with these higher sums becoming increasingly common among hedge funds.
Fhamid Malik, head of financial services at ReThink Recruitment, said: "There has been a flurry of new hedge funds starting up in London - we have acted for four in the last few months. IT infrastructure is critical to how these funds trade, so they are prepared to pay a premium for the right IT skills."
"IT is critical to competitive advantage in the financial services industry, so banks will need to find innovative ways to retain staff if they are to compete in this escalating arms race.â
The firm added that other IT professionals such as chief technology officers and technical architects are being offered equity in businesses as part of compensation packages.