- Greg Jensen to focus on investing role, firm tells clients
- Rubinstein to join firm in May; helped invent the iPod
Ray Dalio’s Bridgewater Associates hired Jon Rubinstein, one of the creators of the iPod, as co-chief executive officer, as the $154 billion firm transitions management away from its founder.
Greg Jensen, currently co-CEO and co-chief investment officer, will drop his administrative duties and focus on his investing role, according to a letter the firm sent to clients. Rubinstein, who worked closely with Steve Jobs for almost 16 years, is often referred to as the Podfather for his role in creating Apple Inc.’s music player. Rubinstein, 59, joins Bridgewater in May.
The hire comes after reports of tensions between Dalio and Jensen, who had been considered Dalio’s heir apparent. Bridgewater started its succession planning in 2010, and has sold stakes to other institutions and set up a committee to run the firm as part of the transition.
“We have concluded that in order to have pervasive excellent management, we need CEOs who can give their full attention to the company’s management, and we want Greg to shift his full attentions to investment responsibilities,” the firm said in the letter. “Also, because technology is so important to us, we wanted one of our co-CEOs to be very strong in that area.”
Bridgewater manages its money using algorithms based on its views of how the economy works. While managers can override the computer instructions, such human intervention rarely happens, according to people with knowledge of the firm.
Rubinstein, who was born and raised in New York, was a longtime deputy to Jobs, the Apple co-founder, and played a key role in the company’s reemergence from near-bankruptcy to technology industry pioneer. As the senior vice president of hardware engineering, he helped create the translucent iMac.
Moves to Palm
In 2006, Rubinstein surprised many people when he left Apple to become executive chairman of Palm Inc., a maker of handheld computers. By 2009, as the company was struggling to compete against the iPhone, he took over as CEO before helping orchestrate the sale of Palm to Hewlett Packard Co. in 2010. Rubinstein left the company in 2012.
"Technology is pervasively important at Bridgewater, especially since one of our major strategic initiatives in the coming years is to continue building out the systemized decision-making," the firm said in the letter. "Jon’s track-record of building world class products will be a tremendous boost to the efforts we already have underway."
The choice of Rubinstein, whose career has been spent on the hardware side of the technology business, might seem unusual for a hedge fund, especially as Bridgewater’s younger competitors have been focusing on software innovations like artificial intelligence and machine learning. Friends and former colleagues say Rubinstein is a good manager of people, especially techies, a skill that’s important in a firm of 1,500 employees with a culture like no other on Wall Street.
"Jon worked with Steve Jobs," said Roger McNamee, managing director of Elevation Partners, which invested in Palm before it was sold to HP. "I think he can handle Ray Dalio. And I’m sure Ray Dalio believes that also. The guy really has thought outside the box here and I really admire that."
Dalio started Bridgewater in 1975 from his two-bedroom apartment, and 41 years later it manages both long-only products as well as the Pure Alpha hedge fund, the largest in the world.
He runs Bridgewater according to 210 principles -- everything from "Don’t try to please everyone” (No. 210) to “Don’t bet too much on anything. Make 15 or more good, uncorrelated bets” (No. 197-d). He promotes “ radical truth” and “radical transparency,” encouraging employees to critique each other in meetings, which are taped and archived.
Bridgewater, in a separate note to clients today that explored what it called the media’s recent mischaracterizations of the firm, called its culture “the reason for our success.”