Hedge fund leader Dalio calls Bridgewater culture 'opposite of a cult'

Tue May 3, 2016 12:13pm EDT
 
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(This May 2 story corrects the quote in the last paragraph)

By Lawrence Delevingne

LOS ANGELES (Reuters) - Ray Dalio, the billionaire founder of Bridgewater Associates, has defended his firm's unconventional management style - based on employees openly challenging each other and giving themselves continuous performance feedback - saying it created a focus on "independent thinking."

"It is a culture, but it's the opposite of a cult," Dalio said at a rare public speaking appearance at the Milken Institute Global Conference in Los Angeles on Monday.

The world's largest hedge fund, with about $150 billion in assets under management, is known for what it calls a system of "radical transparency," envisioned as a meritocracy of ideas where open challenge between employees is encouraged.

But Bridgewater is also known for relatively high turnover among its roughly 1,500-person Westport, Connecticut-based staff. An estimated 25 percent departs during the first 18 months of employment.

"It's painful in the moment sometimes," Dalio said in reference to employees giving each other near-constant feedback on personal strengths and weaknesses. "People are not used to those things."

The hour-long, on-stage appearance came after Bridgewater received some negative attention in February over a reported schism between Dalio and a top deputy, Greg Jensen, over succession planning. Bridgewater at the time called the report an exaggeration of what occurred. Dalio did not address the topic on Monday.

Dalio, interviewed by Robert Kegan of the Harvard Graduate School of Education, noted how employees use iPads with proprietary "dot collector" software. Employees use the application to rate co-workers on 60 personal attributes, such as creativity and reliability. Employees also have a "believability" rating based on their expertise in a particular area.   Continued...

 
Raymond Dalio, Founder, Chairman and Co-Chief Investment Officer of Bridgewater Associates, speaks at the Milken Institute Global Conference in Beverly Hills, California, U.S., May 2, 2016. REUTERS/Lucy Nicholson