In a world where innovation thrives, the most valuable asset a company can provide is exceptional people. Great talent is the common denominator for all successful companies.
This is especially true in the investment industry and is always true of hedge funds. Every hedge fund is essentially a team of people betting that they have the smarts to understand the world better than their competitors. As you aim to consistently beat the markets, you need to be the best in the world at what you do. Success is developing an understanding and ultimately an edge that others have not yet reached. This game is zero-sum and super competitive.
As the deputy chief investment officer of a leading hedge fund, I’m fortunate to see firsthand what it takes to have a chance to be the best. Working in a highly collaborative culture where everyone challenges each other and is constantly striving to improve, we need everyone on our team to be exceptionally bright, relentlessly challenge any consensus around them, and truly passionate about what they do.
Such talent is very difficult to find. Bridgewater has prided itself on attracting the best for decades, but doing so requires an evolution in our approach and requires looking beyond traditional avenues.
Out of the box – and sometimes out of the classroom
It is common for elite companies to turn to the most prestigious schools as their primary method of recruiting incoming investment classes. Bridgewater also takes this route because such universities are often home to many bright students. But the fact is that most of the world’s best talent is elsewhere. Many of the brightest and most innovative thinkers come from diverse backgrounds and educational paths.
My own experiences fueled my commitment to expanding our recruiting horizons. I am a college graduate myself. And before I made that choice, I remember being troubled by the glaring opportunity gaps I saw around me growing up in central Illinois.
Elsewhere, I’ve heard that students have high school teachers with Ph.D.s and receive expensive elite standardized test tutoring. By high school, I had become an avid participant in online communities created to help other students, and had even published an online extensive SAT guide that helped spread best practices freely to hundreds of thousands of students around the world. Students like me.
The democratization enabled by the Internet not only gives students access to otherwise unavailable resources, but also opens up key opportunities for companies to identify the best talent. While the possibilities here are endless, Bridgewater has already begun sourcing candidates through Metaculus, a web-based forecasting platform.
With Metaculus, we run prediction competitions where participants use their abilities and ingenuity to make logical, thoughtful predictions about what will happen in the future. This allows us to seamlessly leverage technology to tap into a vast talent pool that goes far beyond conventional recruiting channels, enabling us to discover talent anywhere in the world.
This is a deeply meritocratic approach.
Last year, our first competition drew students from over 140 schools, as well as many campus candidates that Bridgewater had never reached with previous recruiting efforts. 1,500 people, including 700 undergraduate students from the USA, participated in the competition. Yale is 134th and Harvard is 138th, while Northwestern University leads the ranking.
But the overall winner was an undergraduate student at Grinnell College, a private liberal arts college in Iowa. In addition to the Grinnell student, we interviewed dozens of candidates, resulting in three internship offers from schools we have not historically recruited from. I personally interviewed these three candidates and I can confidently say that they were among the most exciting, promising candidates I have ever met.
This competition is just one example of the many ways new recruitment methods through innovative technologies are leveling the playing field and highlighting what might otherwise be overlooked.
To be best positioned to move forward, leading global companies must consider those who can come up with the best ideas, regardless of the background that informs them.