How to Make Millions by Marketing Yourself as a ‘Douche Bag’

Tim Sykes’s outlandish self-promotional strategies have made him richer than trading ever did
Photographer: Andrew Hetherington for Bloomberg Businessweek

Tim Sykes has a lot of advice for the people who aspire to be as wealthy as he is. Today, the chubby-cheeked 33-year-old has a characteristically strange suggestion: self-harm. “I want everyone to take your hands,” he says into the camera lens of his laptop, “and smack yourself in the face!”

Sykes is seated alone at the dining room table of a $3,000-a-night suite at the Gansevoort hotel in downtown Manhattan. Facing his computer in only a bathrobe and glasses, he looks at the stock chart of a little-known security company called Technical Communications, up 30 percent today on news of a contract to provide encryption to the Egyptian military. Also looking at his screen via a live stream are a few hundred of his most dedicated customers. Sykes runs a social network for traders called, which has about 50,000 members. A subset of 6,000 pay to receive daily e-mail tips, weekly newsletters, and access to thousands of videos such as the trading webinar he’s just begun. These are the people who failed to correctly guess the answer to his hypothetical—“Which stock am I looking at right now?”—and thus necessitated that slap to the face.

“Smack yourself if you don’t get that you should be looking at the day’s biggest percent winner,” Sykes says into the camera. “Over the next two hours this is my No. 1 trade.”

Photographer: Andrew Hetherington for Bloomberg Businessweek

Sykes is a lot of things: a penny-stock trader, a Web entrepreneur, a failed hedge fund manager, and perhaps the most unashamedly press-friendly person in finance. But what he is most of all is a student of hype, the kind that makes the cheap stocks he favors spike and tumble and the kind he manufactures. In the past few years he’s appeared on a handful of reality-TV shows; made parody videos of top-40 songs with his 21-year-old model girlfriend; antagonized CNBC by posting an unflattering picture of its then-top anchor; and purchased a $200,000 sports car that he doesn’t enjoy driving, all in the name of publicity, both good and bad. He’s pretty open about what he’s doing: “I play the role of the rich douche bag.”

For Sykes, every day brings a new opportunity to call attention to himself. He also maintains, where he sells how-to-trade-like-me DVDs for as much as $1,500. In November, to gin up interest in a new disc, he asked his social media followers to leave a comment below a picture of his Porsche, which he said he’d give away to the person he thought was most deserving. “I get to embrace my weirdness,” he says. “The weirder I am, the more viral it goes.” The post has more than 20,000 Facebook “likes” and 3,800 Instagram comments; he still hasn’t given away the car.

Sykes courts attention so investors will find his websites and pay him for advice. After first trading with his own money during the Internet craze and then running a hedge fund that went bust in 2007, he refashioned himself as a guru, telling followers how they can profit by buying and selling penny stocks. He says he’s made $4 million on such trades—and he can teach you how to read market patterns, too, if you’ll just enter your credit card number.

Penny stocks are the most dangerous corner of the market—rife with fraud and get-rich-quick scams—and no legitimate financial adviser would ever recommend them to a client. Sykes views the sketchiness of penny stocks not as a reason to avoid them but as an opportunity to learn more about their patterns. Around the same time that he started, he watched the biopic Kinsey, about the pioneering sex-education researcher, and saw a parallel. “Look up stats about sex education before Kinsey got started,” he says. “People just didn’t want to talk about it openly. Just like the ugly world of penny stocks. Back then everyone’s dirty secret was sex. Today, I’d guess that most traders and investors have tried penny stocks. They’re so tempting! But 90 percent of the people who trade lose. They’re degenerates. I’m trying to give structure to junkies.”

Sykes’s own addiction began as a teenager in Connecticut, when Tommy John surgery cut short a promising tennis career and he was forced to find a new hobby. He quickly became obsessed with the stock market, running between three computers in his high school’s library to keep up with the rise and fall of companies he’d previously never heard of and knew nothing about.

During the fall semester of his freshman year at Tufts University in 2000, Sykes began trading in earnest using the $12,000 his parents had saved from his bar mitzvah. “We figured he would lose it all and learn a valuable lesson,” says his mom, Jo-Ann. He didn’t. Instead, he found a convenient creation myth.

Naturally impatient, Sykes was drawn to the riskiest category of equities: penny stocks. “In my mind it was simple,” he says. “Penny stocks were not only affordable, they were more volatile and more predictable than the larger, higher-profile stocks.”

That predictability was partly the result of something else Sykes didn’t yet understand: the Internet bubble. “I was about to discover I was in the perfect place with the perfect naiveté at the perfect time in stock market history,” he would later write in a self-published book, An American Hedge Fund.

One of Sykes’s most profitable strategies was to buy shares in any company that announced it was adding “.com” to the end of its name, whether it had a working website or not. By the time he realized that his profits were more a result of luck than skill, the market had turned, and Sykes adjusted. He taught himself how to short and bet against the crashing stocks of hot companies he’d bought on the way up.

After transferring to Tulane University, in part because the women at Tufts, he says, were “too unattractive,” he endowed the Timothy Sykes Daytrading Award for the Talented. The absurdist title was inspired by his love for the comedy Zoolander, which also features an improbably named charity. He charged the $15,000 scholarship to his American Express card. By graduation day—which he missed because he was executing a trade that made him the equivalent of his last semester’s tuition—he’d turned his bar mitzvah haul into $1.65 million, before taxes, he says.

Photographer: Andrew Hetherington for Bloomberg Businessweek

Sykes next started a hedge fund called Cilantro Fund Management. Early profits got him included on a 30 Under 30 list published by the short-lived magazine Trader Monthly, a wannabe GQ for the finance world, and that, in turn, led to an invitation to appear on CNBC. The prospect of being on live TV scared Sykes so much, he had to down shots of vodka to loosen up. “I was drunk as s---,” he says. Sykes spoke openly on-air about his biggest loss, a $200,000 hit, with as much glee as his gains. “Most traders don’t like talking about their losses,” he says. “I didn’t care, and that set me apart.” The response was immediate. CNBC wanted him back, and the segment led to his first appearance on a reality-TV show, Wall Street Warriors.

Sean Skelton, the show’s co-creator, says Sykes was originally supposed to be in only one episode. But he was a natural in the heavily scripted, drama-rich environment of reality TV. In contrast to the staid financiers Skelton’s camera crews were following, Sykes was eager to perform. He threw furniture, dated models, and partied late into the night. He even let the show film his mom “accidentally” discovering a pair of handcuffs in his bedroom while she was cleaning his penthouse. “There was no one else like him,” Skelton says. “He was young and cocky, and he loved the camera.” Sykes would tend to agree. “Wall Street Warriors was when I realized that even though my performance was shot because of one bad investment, I could still make a name for myself by being unruly,” he says. “ ’Cause everyone in finance is so f---ing boring.”

The TV gig helped his social life—“I didn’t pay for a drink for six months after it aired,” he says—but it did nothing for his business. Likewise, appearances on CNN, where he debated a porn star and a rabbi on the value of greed, were fun but didn’t improve his bottom line. Then, in 2007, he was the subject of an embarrassing Page Six item in the New York Post. The tabloid reported that Sykes had been denied entry into Trader Monthly’s latest party because his returns had taken a nosedive. In the 24 hours after the story ran, Sykes says, he sold 1,000 copies of his book, which was published that week. It was a lesson in the value of infamy.

Cilantro kept struggling. Sykes lost a third of his fund’s assets, after a failed investment in an e-commerce company, and he shut down operations in October 2007.

It didn’t affect his marketability. As the reality show got picked up in Europe and South America, Sykes began receiving fan mail from all over the world. The letter writers wanted what Sykes had—money—but had no clue how to make it. “The show made me realize there was a much greater need for education and transparency than there was for another kid to manage rich people’s money,” he says.

Sykes started offering free advice online a year after closing his hedge fund. He wrote about the importance of trading conservatively—“I trade scared; I’m a f---ing coward,” he says—and told his readers to look for fraudulent-seeming stocks and short them. It’s impossible to know how many people lost money on Sykes’s ideas, but he’s made sure to promote the winners. One day trader, Michael Goode, 34, who lives in western Michigan, says he’s made $1.4 million investing with Sykes’s techniques.

At first, Sykes believed he’d be best served by writing what he called “exposés.” The penny-stock world had a remarkable number of famous people vouching for suspect companies, which allowed him to get attention by attacking them. Tiger Woods was a spokesman for a nutrition company called Fuse Science—the logo was even on his golf bag—which now trades at a fraction of a penny per share. Justin Bieber made the cover of Forbes even as two penny stocks he’d sponsored lost almost all their value. And Shaquille O’Neal, during an NBA championship ceremony, wore a hat with the logo of a penny-stock company he owned a stake in; its dissolution ended with a 20-year jail sentence for stock fraud for the company’s chief executive officer. Sykes wrote relentlessly about these short targets—so much so that he received multiple cease-and-desist letters from lawyers representing the celebrities. It earned him street cred among day traders and potential customers: one truth teller helping small investors go up against big names.

But in the end, the reports didn’t lead to very much trading profit, and getting dragged into court would have been expensive. Sykes again shifted strategies. “I thought, What if you’re real but you use scam artist techniques?” he says. Or as Goode puts it: “He embraced the douche aesthetic.”

Photographer: Andrew Hetherington for Bloomberg Businessweek

Sykes decided to pattern himself after Tom Vu, the Vietnamese American real estate speculator whose so-bad-they’re-good infomercials in the 1980s and ’90s showed him living a life of hedonistic luxury surrounded by bikini-clad models. In 2012, as a Hanukkah present to himself, Sykes bought the most ostentatious car he could think of, an orange Lamborghini. He paid $60,000 to appear on a Bravo life-on-a-yacht reality-TV show called Below Deck that he knew would portray him as a sleazy stock trader. He began flying private jets and staying in presidential suites so he could make videos of himself splurging and then post them on YouTube and Instagram. “All his marketing makes him look like a jerk,” says his mom. Yet it’s also made him wealthier than trading ever did.

Sykes’s life is now a virtuous (for him) circle of sermonizing, trading, and promotion. There is little in his personal life he won’t transmute into attention. When Bloomberg Businessweek asked for proof that he was actually dating his girlfriend, Bianca Alexa, and not just paying her to act as a live prop to boost subscriptions, Sykes e-mailed a scanned copy of the invoice for an engagement ring he’d purchased. (Weeks later he proposed during a vacation to Bali; she said yes.) Although he says he was banned from CNBC after posting on his blog an unflattering paparazzi-style photo of then-host Maria Bartiromo from the rear—the network declined to comment—he’s appeared on other channels.

While avoiding any talk of how many of his customers lose some or all of their money, Sykes makes full use of his outlier success stories. When a second customer, Tim Grittani, claimed to have made more than $1 million, the two were written up on CNNMoney and appeared on Fox News and Fox Business Network. “I’ve hung out with Tim when the cameras aren’t rolling, and he’s just a completely different person,” Grittani says. “When he’s not selling something he’s just a normal guy. The difference is incredible.”

Once a week, Sykes lets paying customers of access a live feed of his computer screen during a trading session. Making his wagers in front of an audience has made him more cautious. “People will cancel my newsletters if I don’t trade,” he says. “More people will cancel if I make a bad trade.” Sykes says he began 2014 with a $500,000 account. He ended the year up about $875,000, or a gain of 175 percent, his best year ever, he said in December. Meanwhile, he said he netted about $4 million from sales last year, including newsletter subscriptions, DVDs, and fees to access the writing of other self-styled gurus. The site encourages users to make all of their trades public; “transparency” is a big buzzword. Two years ago, a client from Tajikistan who says he made $250,000 using Sykes’s system thanked him by naming his first-born son Timur.

Goode and Grittani acknowledge that when it comes to Sykes’s students, they’re the exception rather than the rule. Both now get paid to run webinars on and have seen how Sykes’s douche marketing can attract the wrong sort of people. “Some new students don’t realize how much the odds are against them,” Goode says. “They’re gamblers. They’ll say, ‘If I win on this trade my wife gets a new camera. If I lose I’ll be prostituting myself in a Walgreen’s parking lot.’ ”

The live stream Sykes is conducting from his room at the Gansevoort hotel ends on a positive note. Near the close of the market, while still broadcasting, he buys shares of Technical Communications. His history tells him that the stock, having just won that contract from the Egyptian government, has a good chance of jumping $1 a share before fading again. Sure enough, by the next morning it’s done exactly that. Selling his stake just a few hours after he’d bought it, Sykes has banked a profit of $3,700, more than enough to pay for that night’s stay. He’ll later post an Instagram video of his digs, of course. Although by then, true to form, the hype will have taken over, and Sykes will have inflated the price of the room to $5,000. “Everything goes hand-in-hand,” Sykes says, leaning back in his chair, smiling, still in his bathrobe. “I teach, I trade, and I make money. It’s a beautiful marriage.”

Caleb Hannan is a Bloomberg Businessweek contributor.

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