Indeed, it is very tough to break in to. Most hedge funds and prop desks who deal with quants wants PhDs. If you're in the industry or you have the talent, it's not too hard to make the jump. You just have to show that you have the right background. I've actually gotten a lot of calls from headhunters recently seeking a quant for a few hedge funds.
Just curious but what kind of background do you have?
Since you have experience in IT, try to transfer to an IT department at an investment bank or a fund. From here, you can work your way in through the backdoor. Honestly, that's probably your only option, unless you want to go back to grad school.