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10 Things You Didn't Know About Dan Loeb

Dan Loeb

Thanks to his activist approach to investing, Dan Loeb is a famous investor whose net worth has grown to $4 billion. He has locked heads with renowned executives and has no apologies to make for his aggressive behavior. He has been called the Kanye West of Wall Street due to his craziness and insecurity. As he continues to lead Third Point Ventures L.P. to greater heights, there is a lot to learn about the CEO, as detailed below.

1. What Pushed Him To Step Down as Success Academy Chairman?

In April 2018, Loeb was stepped down as the chairman of Success Academy. While it was unclear the reason behind his resigning, racially charged emails could have been to blame. The New York Times obtained emails between Loeb and Richard Buery exchanged between 2014 and 2017, showing the venture capitalist's attitude towards Black people. As a result, the mayor Bill De Blasio and Chirlane McCray, his wife, called on Loeb to resign; it was only a matter of time before he stepped down.

2. He Had an Ashley Madison Account

Ashley Madison is a website used by married people who want to engage in extra-marital affairs. Loeb created an account using his private email address, and when a team of hackers released the data, the hedge fund manager did not shy from admitting that indeed he owned an account. However, he was quick to add that it was for research purposes, and he only visited it to see what it entailed. Loeb said the proof that he never intended to engage with anyone was that he did not provide credit account information.

3. He Uses Ruthless Tactics to Get His Way

According to New York Magazine, Loeb is an activist who is very aggressive and prefers to use embarrassing details uncovered by private investigators. In 2012, Loeb sent a letter to Yahoo's board revealing that Scott Thompson, Yahoo's CEO then, falsely claimed to have a computer science degree from Stonehill College. The hedge fund manager went ahead to detail that the college started awarding computer science degrees four years after Thompson's graduation. Yahoo admitted it was an inadvertent error.

4. He Loves Surfing

As reported by Business Insider, Loeb revealed that he had a secret spot in the Caribbean for surfing. He added that Indonesia is among his top places in the world to catch a wave. The venture capitalist's love for surfing even influenced his entrepreneurial activities seeing that his venture capital firm, Third Point Ventures, is named after his favorite surfing spot in Malibu.

5. He Hired a Bodyguard While in Middle School

As an adult, he can pen down letters to companies calling for the resignation of the CEOs using the secrets he uncovers. As a child, he still could not stay out of trouble; at 12-years-old, he attended Paul Revere Junior High School he incited the junior high school bullies. Figuring that he needed to protect himself against them, he hired Robert Schwartz to be his bodyguard, paying him 25 cents daily. Schwartz's loyalty to Loeb paid off because he became Third Point Venture's managing partner.

6. He Started Investing in the Stock Market While in College

After attending the University of California, Berkeley, for a couple of years, Loeb felt he was not getting the intellectual stimulation he needed. He, therefore, transferred to Columbia University to be close to New York City. His degree in economics came in handy, and he started playing the stock market such that by the time he was a senior, he had accumulated $120,000. Unfortunately, Loeb made a poor investment decision when he staked all his money in Puritan-Bennett, Inc.'s stock. He lost all his money because the company was associated with a scandal claiming that its anesthesia equipment had caused several deaths.

7. It Took Him Ten Years to Repay His Father $7000

Today, Loeb is praised as having the Midas touch, and Celebrity Net Worth published how he grew $3 million into $17.5 billion in twenty years. However, the hedge fund manager did not always have disposable income. After losing the $120,000 in a bad bet, he owed $7,000 in taxes, which he could not pay. His father, therefore, loaned him the money, and Loeb took ten years to repay the debt. He remarked that it was a ten-year lesson on leveraging and over-concentrating positions.

8. His Investment Tactic

The mouth that got Loeb in trouble while in middle school is the same one that helped him fuel his business. He formed Third Point Ventures in June 1995 but didn't raise the $10 million he had hoped for; instead, he fell short by $7 million. Still, nothing would keep him from his dreams, so he started using a tactic to drive down the stock prices of targeted companies. Using the pseudonym Mr. Pink, Loeb began tarnishing small-cap companies, and the negative comments would cause companies to collapse. Although some executives sued him for libel, the damage had already been done, and Loeb upgraded to start using his letters of mass destruction.

9. He Was Detained in Cuba for Two Weeks

In 2013, Page Six reported that the hedge fund manager had been detained in Cuba after an accident in which his car hit a kid. Loeb had gone vacationing for the long weekend when the accident happened. The Cuban authorities would not let him leave the country for two weeks, but the venture capitalist went back home after a legal hearing. There were contradicting reports, some claiming that he had been in jail until he was bailed out, while others alleged he was never in prison.

10. He Became Interested in Investing When He was Six

Loeb comes from an entrepreneurial family; Ruth Handler, his great aunt, was the creative mind behind Barbie Doll, and with her husband, Elliott Handler co-founded Mattel. He started associating success with Barbie dolls, and by the time he turned six, he was determined to be an investor. Loeb's love for trading stocks earned him the nickname "Milo Minderbinder" from one of his teachers.

Allen Lee

Written by Allen Lee

Allen Lee is a Toronto-based freelance writer who studied business in school but has since turned to other pursuits. He spends more time than is perhaps wise with his eyes fixed on a screen either reading history books, keeping up with international news, or playing the latest releases on the Steam platform, which serve as the subject matter for much of his writing output. Currently, Lee is practicing the smidgen of Chinese that he picked up while visiting the Chinese mainland in hopes of someday being able to read certain historical texts in their original language.

Read more posts by Allen Lee

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