David Magerman on Building Renaissance Technologies, Why AI is “An Automatic Machine Gun We’re Giving Children,” and Sacrificing Relationships for Success
Invested by Aleph
Why Computer Science Mattered at the Fund
David explains the production engineering and system design needed to trade thousands of stocks reliably.
On this episode of Invested, Michael sits down with David Magerman, a co-founder and Managing Partner at Differential Ventures, a New York-based venture capital fund investing in deep technology companies that help power the data-driven economy. Previously, he spent the entirety of his career at Renaissance Technologies, widely recognized as the world’s most successful quantitative hedge fund management company. He helped found the equities trading group at Renaissance, joining the group in its earliest days, playing a lead role in designing and building the trading, simulation, and estimation software. David holds a PhD in Computer Science from Stanford University where his thesis on Natural Language Parsing as Statistical Pattern Recognition was an early and successful attempt to use large-scale data to produce fully-automated syntactic analysis of text.
David is also the founder and president of Tzemach David, an education-focused foundation working to make education in Israel more accessible to English-speaking immigrants. Outside of his foundation's work, he is a significant contributor to the OU-JLIC in Israel, Koren Publications, Lori Palatnik's Momentum Unlimited, The City of David, and Rabbi Shlomo Katz's Shirat David, as well as some other more under-the-radar projects supporting the development and strength of the Land of Israel.
Please rate this episode 5 stars wherever you stream your podcasts!
KEY TOPICS
00:00 - Intro
02:55 - Why Wall Street’s Smartest Fund Rejected Finance People
06:04 - If You Can’t Close, You’re Useless
08:42 - The Hedge Fund That Invented Google Culture
12:58 - We Got Rich Solving Problems That Didn’t Matter
15:55 - How Jim Simons Proved Economists Were Wrong
17:23 - Success Was the Only Thing That Made Me Happy
18:28 - Why My Team Was Afraid of Me
21:56 - The Day I Realized No One Actually Cared
25:42 - Why Renaissance Was a Moral Failure
27:51 - I’m Glad I Made All the Wrong Choices
39:08 - AI Has Always Been a Scam
41:53 - The Truth About AI Demos No One Admits
44:55 - We Gave a Dangerous Technology to Children
45:33 - This AI Bubble Makes the Dot-Com Crash Look Small
52:38 - AI Is Killing the Next Generation of Engineers
55:47 - We’re Raising a Workforce That Can’t Think
56:42 - Most AI Use Cases Are Stupid
1:03:39 - How Tech Makes Money by Hurting People
1:08:34 - Why “Startup Nation” Is the Wrong Story
RESOURCES
Follow David on LinkedIn: https://www.linkedin.com/in/david-magerman-954b25174/
Learn more about Differential Ventures: https://www.differential.vc/
Subscribe to Invested here: https://content.aleph.vc/invested
Learn more about Aleph: aleph.vc
Sign up for Aleph’s monthly email newsletter: https://newsletter.aleph.vc/
Subscribe to our YouTube channel: https://www.youtube.com/@aleph-vc/
Follow Michael on Twitter: twitter.com/mikeeisenberg
Follow Michael on LinkedIn: https://www.linkedin.com/in/mieisenberg/
Follow Aleph on Twitter: https://twitter.com/mikeeisenberg
Follow Aleph on LinkedIn: https://www.linkedin.com/company/aleph-vc/
Follow Aleph on Instagram: https://www.instagram.com/aleph.vc/
CREDITS
Executive Producer: Erica Marom
Producer: Myron Shneider, Sofi Levak
Video and Editing: Ron Baranov, Nadav Elovic
Music and Creative Direction: Uri Ar
Content and Editorial: Kira Goldring
Design: Rony Karadi
The AI-powered Podcast Player
