One of the main players in the hedge-fund talent war doesn't believe there's a battle going on.
Izzy Englander, the billionaire founder of Millennium, said Tuesday at the Robin Hood Investors Conference that there is "a talent bubble" in the industry thanks in part to long non-compete clauses — which firms like his and Citadel, Point72, ExodusPoint, and others use to discourage leaving — forcing funds to pay more and more for the best investors.
Englander, who was interviewed by fellow hedge-fund billionaire Paul Tudor Jones, said the non-competes also created an artificially smaller pool of potential hires, driving their price up, according to a source who was in attendance for the talk.
Hedge funds, specifically firms with large quant teams like Millennium, have gone to great lengths to keep talent locked up in an attempt to keep a competitive edge and retain proprietary technology and research knowledge in-house. Over the years, employees have been asked to sign contracts that would forbid them from working in the industry for up to 15 to 24 months, Insider has previously reported.
Multi-strategy funds in particular have been scooping up talent and driving the competition, using "pass-through" fees investors pay that can go toward firm expenses like hiring.
Millennium declined to comment.
Robin Hood, a charity focused on eradicating poverty in New York City, holds an annual conference closed to the press that often features big-name political, finance, and tech figures. This year, one of the big themes was artificial intelligence, and Sam Altman, the CEO of OpenAI, spoke via video feed with Reddit cofounder Alexis Ohanian.
Englander, who spoke after Altman, was asked about AI's potential. He told the audience that he thinks it is a tool, but not a substitute. He compared it to other major technological breakthroughs like electricity, but doubts the money management industry will be run by robots any time soon.
