Five lessons from Peter Brown, CEO of Renaissance Technologies
"I continue to love the process of showing that human intelligence, intuition, creativity, and finesse are nothing more than computation."
Hello everyone,
Peter Brown, CEO of hedge fund Renaissance Technologies, recently gave a rare interview. Even Gregory Zuckerman, author of the Jim Simons biography The Man Who Solved the Market was shocked (his interpretation Renaissance was looking for some positive PR).
Before joining Renaissance, Brown had worked with Robert Mercer at IBM on software to transcribe and translate speech. They were doing large language models long before they became fashionable (or large by today’s standards):
We had very little data. And very little computer power. Just some time allotted to us on an IBM mainframe, which is probably less powerful than your cell phone is today. But yes, like with ChatGPT, the idea was to see if we could build a language model purely from data that would mimic human knowledge of grammar and semantics.
Why did he and Mercer leave IBM? Take a guess.
Three things happened. First, Bob had a second daughter accepted to Stanford. But he couldn't afford to pay for her to go to Stanford on his IBM salary. So, she had to go to the agricultural school at Cornell, which offered scholarships to New York State residents.
The second thing that happened is we had a daughter born. And a third thing was that Jim then offered to double my compensation. After that offer, I came home. I took one look at our newborn daughter and realized I had no choice in the matter. So, the decision to leave computational linguistics for a small hedge fund that no one had ever heard of was made purely for financial reasons.
Can’t blame him and it leads me to the first of my highlights from the conversation.
Why bureaucracies can’t keep exceptional talent.
What it takes to run one of the world’s most successful hedge funds.
Even the quants can’t see the future and the value of volatility.
“Some guy from some firm named Baupost.”
Renaissance’s five principles.
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