How to hire the wrong people, by Sam Bankman-Fried

Maybe the investment banks got it wrong? Rarely has an industry placed more value on references. But Sam Bankman-Fried, the 30-year-old billionaire CEO and founder of crypto exchange FTX, says it’s a bad approach. If you hire people because they have the right credentials on paper, most of the time they won’t work, says Bankman-Fried. They will likely be underperformers who prefer to stay on shore.

It’s not clear if Bankman-Fried’s thinking applies to college graduates with high qualifications from top universities (of which he is one), but it probably applies to older folks flitting from job to job, collecting big names on their resumes before they present themselves to FTX. It certainly applies to senior executives who might qualify as trophy settings. “IIt’s common for us to hear something like, “You should hire this CFO of a big public company and make him your CRO.” That’s never a good idea, in our view. It never works,” Bankman-Fried told The Generalist. Often that type of person wants to take it easy in a retirement job, he added. And you don’t really know how good they are or how well they’ve done.” -Why do they want to quit their job when they are so powerful?”

Instead of those people with great references, he said the best employees are often not the ‘right’ employees on paper: “They may not have the fanciest resumes or the most experience.” At FTX, they prefer to hire people who “can enter a busy, complex, and messy environment and work hard,” Fried said. “We like people who grind those want work. And who are willing to do the work themselves.” The worst thing you can do is hire managers who enjoy managing other managers.

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How do you recognize these people? When interviewing, Bankman-Fried says he doesn’t ask for FTX (“CCandidates do not have enough context to provide an answer that is meaningful to me as an interviewer.”) Instead, he asks them to,”explain concisely a project they have been working on and outline their main goals in a way that survives a plausibility check.” The goal is to assess “lucidity of thought”. This is something that is often missing…

Regardless, if an analyst at an investment bank spends $32,000 in a week for his birthday, it suggests that he is very committed to continuing his job and continuing his lifestyle, that he is a dumbass (considering that analysts at JPMorgan only earn $175,000 – $260,000 gross) or that he lies about being a JPM analyst/has an additional source of income?

Either way, that should show a current TikTok video. Much of the money appears to have gone to Ubers, hotels and clothing, including various items from Bruno Cucinelli, an Italian clothing boutique where a pair of ripped jeans costs nearly $700.

@jackiemorrow_1 it was his birthday week 🤣 #financebro #whatispendinaweek #richboycheck #personalfinance ♬ Original sound – Jackie Morrow

In the meantime…

Credit Suisse could rename its investment bank First Boston. (Blumberg)

UBS has a team of dedicated Chinese content reviewers to ensure their research does not contain anything that could trigger in China. (financial times)

New British Chancellor of the Exchequer Kwasi Kwarteng not only wants to abolish the EU bonus ceiling, he also wants to do without it Solvency II rules that insurers say are hampering their ability to pump an estimated £95bn into long-term infrastructure projects like wind farms and social housing. (The times)

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Lazard hired a woman as Chairman of the financial advisory business in the Middle East and North Africa, based in Saudi Arabia. Sarah Al-Suhaimi was previously Chair of the Saudi Stock Exchange. (Blumberg)

It’s been a long time since a major tech IPO happened. It will be on Wednesday 238 days without a tech IPO worth more than $50 million, longer than previous records from the 2008 financial crisis and dot-com crash. (financial times)

Mizuho hired BNP Paribas’ David Moore as Head of G10 Rates Sales and Trading in the Americas. (The Business News)

People who have left Coinbase have had no trouble finding new jobs. A software developer said he was inundated with news from crypto firms, recruiters and Wall Street banks. (Blumberg)

The lifecycle of fintech events. (work week)

The people most likely to help you find a new job are the ones you don’t know that well. (Guardian)

The second season of HBO’s “Industry” is based on the post-COVID era. ‘Yasmin has spent the last year ‘seeing’ in huge kitchens trying to find the perfect pair of white pyjamas. Harper lived alone in a hotel, eating burgers in her robe, surrounded by screens…” (The Times)

Breaking your femurs to make your legs longer is the new go-to for men’s cosmetic surgery. It costs $75 and is “excruciating.” (GQ)

Photo by Varvara Grabova on Unsplash

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