Max Stone will never live it down: Once, he nearly blew up D.E. Shaw & Co., one of the first great quant shops on Wall Street.
Stone, barely 30 at the time, had drastically underestimated the financial risks he was taking. When markets turned — disaster. D.E. Shaw lost roughly 30%. Stone thought his head would roll.
“If I had been fired, no part of me would have thought that was unfair,” Stone said in a recent interview. “I did nearly destroy a company.”
So it might come as a surprise that Stone, now 57, is still at D.E. Shaw — and at the very top, no less. Twenty-eight years on, he’s part of an unusual collective, a sort-of hive-mind CEO. Together, its seven members are charting the future of the firm, a pioneer in harnessing computers to wring money out of the markets. Job one: ensuring no one screws up the way Stone did as D.E. Shaw navigates a perilous new landscape.
Ever since the computer scientist David E. Shaw founded the hedge-fund operator in 1988, above a communist bookstore in Manhattan, D.E. Shaw has cultivated a certain mystique. Outsiders have long regarded it as the secretive “King of Quant” — an eccentric group of math whizzes and liberal arts-types who merged quantum physics with Wall Street.