One of three children, Loeb grew up in Santa Monica Canyon, north of Los Angeles. His great-aunt Ruth Handler created the Barbie doll and along with his great-uncle Elliot Handler founded Mattel, Inc., the toy company. His father, Ronald, who suffered from Alzheimer’s disease for eight years and died in 2012, was a partner in the Los Angeles law firm of Irell & Manella, where he worked for 38 years before becoming the general counsel at Williams-Sonoma. A marathon runner and cyclist, Ronald was “very smart, very sensitive, and had a marvelous sense of humor,” according to Clare Spark, his wife of 13 years and Dan Loeb’s mother. “His work ethic was formidable. I don’t think that he stopped working from age 12 onward until his illness.”
If Loeb got his ferocious energy from his father, he got his feisty style and activist instincts from Spark, who wrote her Ph.D. dissertation on Herman Melville. Thanks to a political awakening that started with the civil-rights movement, she produced and hosted radio shows—including one about art and institutions, another about “contested definitions of Fascism”—on KPFK, the Pacifica leftist radio station in Los Angeles. “I am deeply anti-racist and continue to be offended by all symptoms of proto-Fascism and authoritarian conduct,” Spark says of her free-market philosophical leanings, which she discusses on YDS: The Clare Spark Blog.
She and Ron Loeb divorced in 1972. Dan, who was nine, went to live with his father, while his sisters stayed with their mother. “He lived with his father … because he had sisters, and I thought he needed a male presence,” Spark says.
Like a lot of Southern California kids, Loeb loved surfing, especially at Third Point, the fabled break at Surfrider Beach in Malibu. But even then he wasn’t all that laid-back. He has claimed he dreamed from an early age about being an investor. “I used to write down ‘Third Point’ over and over—‘Third Point Partners,’ ‘Third Point Partners,’ ” he once recalled. Source:
“It’s pretty stunning to me, unreal,” she says.
Loeb started playing the stock market early, when he was a student at Columbia, after transferring there from Berkeley. (“I don’t think he was getting the intellectual stimulation at Berkeley that he wanted,” Spark says. “He wanted to be in New York City.”) By the time he graduated he had accumulated $120,000 in cash. Feeling cocky, he bet it all on the stock of Puritan-Bennett, Inc., a maker of medical equipment. But when it was reported that some of their anesthesia machines were linked to the deaths of a few patients, he lost everything. He owed his father $7,000, which it took him 10 years to repay. After working briefly at Warburg Pincus, the private equity firm that owned an equity stake in Mattel, and at Island Records, where he was director of corporate development, he joined Lafer Equity Investors, a New York hedge fund, where he learned the “craft” of risk arbitrage—betting on the outcome of mergers and acquisitions and other “event driven” opportunities. Loeb met Chapman, who was then working at Great Pacific Capital, at a meeting about a potential takeover of Tambrands Inc. Loeb asked a pointed question, and Chapman thought it was entertaining and “boldly direct.” They became friends, and, Chapman recalls, after Loeb left Lafer, he slept on Chapman’s couch for a brief time to conserve funds before finding a new place to rent.
In September 1991, Loeb got a job as an analyst at the investment bank Jefferies & Co., in Los Angeles. That’s when “my real trajectory took off,” he has said. By then he “thought I could do this as well as others” and wanted to start Third Point. But he needed some more money, so in 1994, he took a job at Citicorp Securities as a junk-bond salesman.
In June 1995 he finally realized his dream and formed Third Point. He had hoped to raise $10 million, but ended up with only $3 million, from his immediate family, other relatives, and a wealthy friend, plus $340,000 he himself had saved from working on Wall Street. His preferred investment tactic was to spew venom at corporate C.E.O.’s on investor-oriented Web sites, reportedly, under the pseudonym “Mr. Pink” (taken from the name of the outspoken robber in the 1992 Quentin Tarantino movie Reservoir Dogs). After shorting the stock of small-cap companies (generally defined as those worth between $300 million and $2 billion), Mr. Pink would make vicious comments which would often drive down their stock prices. One company targeted was Hitsgalore.com Inc., an early Internet firm that soared and then crashed. After Bloomberg reported some negative news about its founder, its stock—trading under the symbol HITT—collapsed. Mr. Pink wanted more. He referred to the company as “sHITT” and wrote, “These crooks belong in jail.” Mr. Pink dared Hitsgalore to sue him, and it did, in June 1999. At first, Loeb would not confirm or deny that he was Mr. Pink, but in a March 2000 affidavit, he admitted it was his “screen name,” used to attack the company. (The suit was dropped a month after he filed the affidavit.)
That same year, 1999, Loeb got into more legal trouble, this time with John Liviakis, a San Francisco public-relations executive, who also sued Loeb for libel. Using a pseudonym, allegedly Loeb had written an imaginary monologue, supposedly in Liviakis’s voice: “I have registered 1.7 million shares to sell and these will soon flood the market. Hopefully I will sell these before the company loses its Nasdaq listing. . . . Then I will laugh at you fools for buying my shares and I will celebrate with a bottle of grappa, some fresh feta, and a nice young boy—just like in the old country.”
Liviakis says the suit against Loeb—since settled—was groundbreaking because it “pierced the veil of secrecy” that Loeb and others were using to talk down the value of the small-cap stocks they were shorting. The comments, says Liviakis, “were talking about pedophilia, and there were disparaging, racist sort of remarks about my Greek heritage, and all kinds of evil things, to try to make fun of me and make fun of companies that I was involved in, and anyway to scare down the stock.” (Despite repeated requests, Loeb declined to participate in this article.)
Loeb has since developed a higher-profile strategy—originated by Chapman—of getting the attention of corporate managers he loathed by attaching what they called “letters of mass destruction” to the public filings required by the Securities and Exchange Commission. But Loeb took the rhetoric to new levels of obstreperousness, and he refined the twist of making withering personal comments about a target company’s executives. As a former Third Point employee told journalist Nicholas Stein in 2007, Loeb “believes that if you embarrass a CEO in front of his friends at the club, make him feel like people are talking about him, you can exert change on his company.”
Address: 131st N.E. Ave.,
Kirkland, WA, 98033
Contact: 800-419-0211
For instance, in an April 2003 letter to L. Pendleton Siegel, the chairman and C.E.O. of the forest-products company Potlatch, Loeb wrote, “You and your smirking C.F.O. Gerald Zuehlke (he smirked when confronted with the large losses in the company’s pension plan) are among the worst managers of a public company in America. Arrogance is never acceptable, but it is particularly surprising given the collapse of Potlatch’s shares Your atrocious management record and inexplicable insouciance have led your shareholders to the rational decision to repatriate their capital from your trust even though it means jettisoning shares at least 55 percent below Potlatch’s intrinsic value.” (Today, Potlatch remains in business, with a market capitalization of $1.7 billion.)
In a February 2005 letter Loeb went after the C.E.O. of Salton, Inc., the maker of George Foreman grills, ice-cream machines, and other small kitchen appliances. To agitate for the removal of Leonhard Dreimann, he accused the Salton board of directors of squandering corporate assets by putting the Salton name on the sponsorship walls of Arthur Ashe Stadium during the U.S. Open tennis finals: “My bewilderment quickly turned to anger when I saw the crowd seeking autographs from the Olsen twins just below the private box that seemed to be occupied by Mr. Dreimann and others who were enjoying the match and summer sun while hobnobbing, snacking on shrimp cocktails and sipping chilled Gewurtztraminer.”
In April 2005, after selling his Salton shares at a big loss, Loeb couldn’t resist firing off one last potshot: “The final decision to exit the position was not based on your incompetence, arrogance and innumerable shortcomings alone. It was my conclusion that the company’s board is governed by a toothless crew of cronies or pathetically weak individuals who I can only conclude are in way over their heads and unable to take appropriate action.”
A colleague who has known Loeb for decades says Loeb “can write the most obnoxious letters on the planet, make up shit—[because he does] not really care … whether or not you hurt people or don’t hurt people. You just don’t care. The only thing you care about is making money on their stock. . . . [His letters] were juvenile, sophomoric, and cringe-making. Horrible. If you’re a decent member of society you [don’t do] shit like that. But he did. That was his business strategy. He was very smart. Because other people—most of us—have certain values and certain norms, and there are certain boundaries we just won’t cross. And he just obviously doesn’t have those same kind of limitations. Never has.”
Source: http://www.vanityfair.com/business/2013/12/dan-loeb-cuba-car-accident
If Loeb got his ferocious energy from his father, he got his feisty style and activist instincts from Spark, who wrote her Ph.D. dissertation on Herman Melville. Thanks to a political awakening that started with the civil-rights movement, she produced and hosted radio shows—including one about art and institutions, another about “contested definitions of Fascism”—on KPFK, the Pacifica leftist radio station in Los Angeles. “I am deeply anti-racist and continue to be offended by all symptoms of proto-Fascism and authoritarian conduct,” Spark says of her free-market philosophical leanings, which she discusses on YDS: The Clare Spark Blog.
She and Ron Loeb divorced in 1972. Dan, who was nine, went to live with his father, while his sisters stayed with their mother. “He lived with his father … because he had sisters, and I thought he needed a male presence,” Spark says.
Like a lot of Southern California kids, Loeb loved surfing, especially at Third Point, the fabled break at Surfrider Beach in Malibu. But even then he wasn’t all that laid-back. He has claimed he dreamed from an early age about being an investor. “I used to write down ‘Third Point’ over and over—‘Third Point Partners,’ ‘Third Point Partners,’ ” he once recalled. Source:
“It’s pretty stunning to me, unreal,” she says.
Loeb started playing the stock market early, when he was a student at Columbia, after transferring there from Berkeley. (“I don’t think he was getting the intellectual stimulation at Berkeley that he wanted,” Spark says. “He wanted to be in New York City.”) By the time he graduated he had accumulated $120,000 in cash. Feeling cocky, he bet it all on the stock of Puritan-Bennett, Inc., a maker of medical equipment. But when it was reported that some of their anesthesia machines were linked to the deaths of a few patients, he lost everything. He owed his father $7,000, which it took him 10 years to repay. After working briefly at Warburg Pincus, the private equity firm that owned an equity stake in Mattel, and at Island Records, where he was director of corporate development, he joined Lafer Equity Investors, a New York hedge fund, where he learned the “craft” of risk arbitrage—betting on the outcome of mergers and acquisitions and other “event driven” opportunities. Loeb met Chapman, who was then working at Great Pacific Capital, at a meeting about a potential takeover of Tambrands Inc. Loeb asked a pointed question, and Chapman thought it was entertaining and “boldly direct.” They became friends, and, Chapman recalls, after Loeb left Lafer, he slept on Chapman’s couch for a brief time to conserve funds before finding a new place to rent.
In September 1991, Loeb got a job as an analyst at the investment bank Jefferies & Co., in Los Angeles. That’s when “my real trajectory took off,” he has said. By then he “thought I could do this as well as others” and wanted to start Third Point. But he needed some more money, so in 1994, he took a job at Citicorp Securities as a junk-bond salesman.
In June 1995 he finally realized his dream and formed Third Point. He had hoped to raise $10 million, but ended up with only $3 million, from his immediate family, other relatives, and a wealthy friend, plus $340,000 he himself had saved from working on Wall Street. His preferred investment tactic was to spew venom at corporate C.E.O.’s on investor-oriented Web sites, reportedly, under the pseudonym “Mr. Pink” (taken from the name of the outspoken robber in the 1992 Quentin Tarantino movie Reservoir Dogs). After shorting the stock of small-cap companies (generally defined as those worth between $300 million and $2 billion), Mr. Pink would make vicious comments which would often drive down their stock prices. One company targeted was Hitsgalore.com Inc., an early Internet firm that soared and then crashed. After Bloomberg reported some negative news about its founder, its stock—trading under the symbol HITT—collapsed. Mr. Pink wanted more. He referred to the company as “sHITT” and wrote, “These crooks belong in jail.” Mr. Pink dared Hitsgalore to sue him, and it did, in June 1999. At first, Loeb would not confirm or deny that he was Mr. Pink, but in a March 2000 affidavit, he admitted it was his “screen name,” used to attack the company. (The suit was dropped a month after he filed the affidavit.)
That same year, 1999, Loeb got into more legal trouble, this time with John Liviakis, a San Francisco public-relations executive, who also sued Loeb for libel. Using a pseudonym, allegedly Loeb had written an imaginary monologue, supposedly in Liviakis’s voice: “I have registered 1.7 million shares to sell and these will soon flood the market. Hopefully I will sell these before the company loses its Nasdaq listing. . . . Then I will laugh at you fools for buying my shares and I will celebrate with a bottle of grappa, some fresh feta, and a nice young boy—just like in the old country.”
Liviakis says the suit against Loeb—since settled—was groundbreaking because it “pierced the veil of secrecy” that Loeb and others were using to talk down the value of the small-cap stocks they were shorting. The comments, says Liviakis, “were talking about pedophilia, and there were disparaging, racist sort of remarks about my Greek heritage, and all kinds of evil things, to try to make fun of me and make fun of companies that I was involved in, and anyway to scare down the stock.” (Despite repeated requests, Loeb declined to participate in this article.)
Loeb has since developed a higher-profile strategy—originated by Chapman—of getting the attention of corporate managers he loathed by attaching what they called “letters of mass destruction” to the public filings required by the Securities and Exchange Commission. But Loeb took the rhetoric to new levels of obstreperousness, and he refined the twist of making withering personal comments about a target company’s executives. As a former Third Point employee told journalist Nicholas Stein in 2007, Loeb “believes that if you embarrass a CEO in front of his friends at the club, make him feel like people are talking about him, you can exert change on his company.”
Address: 131st N.E. Ave.,
Kirkland, WA, 98033
Contact: 800-419-0211
For instance, in an April 2003 letter to L. Pendleton Siegel, the chairman and C.E.O. of the forest-products company Potlatch, Loeb wrote, “You and your smirking C.F.O. Gerald Zuehlke (he smirked when confronted with the large losses in the company’s pension plan) are among the worst managers of a public company in America. Arrogance is never acceptable, but it is particularly surprising given the collapse of Potlatch’s shares Your atrocious management record and inexplicable insouciance have led your shareholders to the rational decision to repatriate their capital from your trust even though it means jettisoning shares at least 55 percent below Potlatch’s intrinsic value.” (Today, Potlatch remains in business, with a market capitalization of $1.7 billion.)
In a February 2005 letter Loeb went after the C.E.O. of Salton, Inc., the maker of George Foreman grills, ice-cream machines, and other small kitchen appliances. To agitate for the removal of Leonhard Dreimann, he accused the Salton board of directors of squandering corporate assets by putting the Salton name on the sponsorship walls of Arthur Ashe Stadium during the U.S. Open tennis finals: “My bewilderment quickly turned to anger when I saw the crowd seeking autographs from the Olsen twins just below the private box that seemed to be occupied by Mr. Dreimann and others who were enjoying the match and summer sun while hobnobbing, snacking on shrimp cocktails and sipping chilled Gewurtztraminer.”
In April 2005, after selling his Salton shares at a big loss, Loeb couldn’t resist firing off one last potshot: “The final decision to exit the position was not based on your incompetence, arrogance and innumerable shortcomings alone. It was my conclusion that the company’s board is governed by a toothless crew of cronies or pathetically weak individuals who I can only conclude are in way over their heads and unable to take appropriate action.”
A colleague who has known Loeb for decades says Loeb “can write the most obnoxious letters on the planet, make up shit—[because he does] not really care … whether or not you hurt people or don’t hurt people. You just don’t care. The only thing you care about is making money on their stock. . . . [His letters] were juvenile, sophomoric, and cringe-making. Horrible. If you’re a decent member of society you [don’t do] shit like that. But he did. That was his business strategy. He was very smart. Because other people—most of us—have certain values and certain norms, and there are certain boundaries we just won’t cross. And he just obviously doesn’t have those same kind of limitations. Never has.”
Source: http://www.vanityfair.com/business/2013/12/dan-loeb-cuba-car-accident