All that math brain power that Wall Street is busy shedding: Can it plug into the algorithm economy of profiling, preferences, predictions and recommendations?
I called Darren Vengroff. He’s the chief scientist at RichRelevance, a San Francisco company that helps e-commerce sites figure out what to recommend to their customers. Like Amazon’s, the recommendations are based on the statistical analysis of people’s behavioral patterns. But RichRelevance is trying to take it a step further. Vengroff worked in exotic derivatives at Goldman Sachs before moving his math smarts to Amazon in 2002. He has a phd in computer science from Brown.
So, can the Wall Street quants make the jump to Amazon, Google, or even RichRelevance?
Some could start tomorrow, he said. Some, never. While they all have a thorough understanding of probability and statistics, many lack a knowledge of software design. Smart math without good distributed software to implement it cannot produce revenue quickly enough, he said.
I asked if bigger companies than RichRelevance could afford to hire the mathematicians and count on other specialists to handle the software work. Probably not, said Vengroff: “It delays getting to market if you have to go through this translation step from mathematicians to engineers.”
Other tech destinations for the Wall Street diaspora, ones that don’t require software know-how?
He said that optimizing thousands or millions of search bids to get the best returns uses many of the portfolio modeling skills common on Wall Street. Companies like Efficient Frontier of Sunnyvale, Calif., specialize in this. But it’s hardly a job market the size of Wall Street.
(Cross-posted on TheNumerati.net)