Photo: Bev Eyre
If F. Scott Fitzgerald had lived to meet Jeffrey Gundlach, the author might have sang a different tune.The king of bonds and founder of DoubleLine Capital Management has not only experienced a second act, but a third.
After a legal battle with his former firm TCW, where he’d spent more than two decades, Gundlach barely missed a beat.
That’s not surprising, since his very first act was keeping rhythm in a band during the heyday of LA’s rock and punk scene.
We’ve profiled many people on this site over the years, but we doubt you’ve seen a story like this.
His father was a chemist for a bowling alley. 'When our drying machine broke, it didn't get fixed,
Beverley Eyre, the band's cofounder, said Gundlach had been playing in another band at Dartmouth, and after hearing him play was intent on recruiting him to his group. Gundlach agreed. The pair put in an ad for a bassist, and settled on Nancy Draper, who became Gundlach's wife. The band, initially called 'The Greens,' (Eyre said he simply liked the colour) was born.
Source: Bev Eyre
When they got to L.A., they changed the name of the band to Radical Flat because, Eyre said, he and Gundlach 'are both maths people.'
Source: Bev Eyre
'He was an incredible drummer,' Eyre said. 'He could have made a career ... He's fast. He tends to go faster than when the song was being rehearsed. He was excited; he never missed beat, like a machine gun. He could play so many cool rhythms, switch tempos, doing something real fast, then a little slower.'
Source: Bev Eyre
'We spent years trying to get songs on the radio, on TV, but never quite went that next level,' Eyre said.
But it wasn't for lack of trying.
'Jeff was just so driven,' he said. Eyre recalled one night when the group was out having a late-night meal and discussing the band's future. 'Jeff just said, 'OK, let's go right now, we're gonna practice until we get five songs perfect. Let's go do it,' It was after midnight, but we all just sat up. It was pure Jeff pushing us on. We were there all night practicing. He was driven; he wanted to succeed. In a sense, he was one of the drivers of the momentum, the power player side. He wanted to push us on.'
After a stint at Transamerica, he got a job as an investment manager for TCW Inc.
According to Reuters, he said he was inspired to work in financial services in the 1980s by an episode of the TV show 'Lifestyles of the Rich and Famous' hosted by Robin Leach and featuring the 10 top-paying careers.
'I think, great! I'll just listen to that and figure out what I am going to do,' he told the wire. The No. 1 highest-paying profession at the time was investment banker. 'The show said you need to have worked very hard --not like I don't do that already--and the show said you need to have an analytical mind--and I said, I've got an 11 on a scale of 10--and I said that's what I am going to do.'
If this were a Behind The Music episode, here's when the music turns to a minor key.
The afternoon of Friday, Dec. 4, 2009 Gundlach walked back from lunch into his office and was fired.
TCW legal counsel 'alleged gross misconduct, including an attempt to steal staff and confidential client and trade information to launch his own rival firm,' Farzad writes. 'His 24 years with TCW were over, effective immediately. His BlackBerry was already disabled.'
Which as the NYT's Kevin Roose noted at the time, is 'a world where the bar for captivation is relatively low.' However, many lay-people would find some of the details entertaining. Dealbook and CNBC, for example, reported that when Gundlach and his cohorts were clearing out, a secretary apparently hid a thumb drive in her bra.
Source: New York Times
TCW would later claim Gundlach kept in his office a stash of porn, sexual devices, and pot-smoking accessories.
All 15 of his senior staff ended up resigning from TCW, including Philip Barach, co-manager of the TCW Total Return Fund. 'Surrounded by a circle of mutineers, Gundlach, who says he got misty-eyed, persuaded Barach to join them,' Farzad writes. 'The two men shook hands and hugged, and the reunited team applauded Barach as he thumbed out his own resignation on his BlackBerry.'
That's what Barron's called him in a profile last year. Over the course of his investing career, his success almost exclusively in mortgage-backed securities--even during a decade when 'the mortgage-backed market underwent tectonic shifts, destroying many less able investors.'
'Look, I have a gift, or some would say a curse, of being able to have stunning insight into the reality of markets and the economy,' he told Barron's. 'I don't often know where my ideas come from. Maybe it's the fact that I'm obsessively regimented in my analysis, borderline autistic. But whether it's bond selection or asset allocation, we can do it better than just about anybody around.'