Friday, May 14, 2021

Jim and Nathaniel Simons step down as Renaissance co-chairs

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Renaissance Technologies founder Jim Simons appointed Peter Brown, CEO of the hedge fund, as sole chairman, a position many expected to go to his son Nathaniel Simons, who was named co-chairman alongside his father last year.

The father and son will step down as co-chairs but will remain on the board as directors, according to regulatory documents filed Thursday. The move indicates that former Mr. Simons is stepping up his preparations to hand over the company he founded nearly four decades ago to the next generation. Renaissance manages $ 60 billion in assets.

Mr. Simons, 83 years old, appointed his son co-chair of Renaissance in January 2020, in what seemed to be a sure sign that young Mr. Simons would succeed his father. He had spent 13 years with the company as a director before leaving to pursue projects related to climate change.

“I think it’s time: this transition has taken many years and Peter Brown, our new president, is more than ready to take responsibility,” Simons said in a statement.

The move comes at a difficult time for Renaissance, which has struggled to manage market volatility since the onset of the coronavirus pandemic. Its Renaissance Institutional Equity Fund ended 2020 down nearly 20%, while its Renaissance Institutional Diversified Alpha was down 31%, according to people close to the company.

Meanwhile, the company’s flagship fund, Medallion, which kicked out outside investors in 2005 and is only open to the company’s own employees, gained 76% last year, according to a report by Institutional investor.

The eldest Mr. Simons retired from the day-to-day management of Renaissance in 2010 when he handed over the reins to Mr. Brown and Robert Mercer. The two lieutenants shared the role until 2017, when Mr. Mercer left the company amid controversy over his support for President Donald Trump and the media outlet Breitbart News.

Another title for Mr. Brown, who is the current President and CEO of the company, will be chairmanship of the board. A representative from Renaissance did not comment on the board’s moves, but said Mr Brown had led the group for a decade.

Succession planning has become a major challenge for the hedge fund industry as it matures. Many of the aging founders who enjoyed enormous success in their golden years and are synonymous with the groups they built have struggled to name successors.

Bridgewater Associates, the hedge fund manager founded by Ray Dalio, has had a number of CEOs over the past decade. Last year he appointed David McCormick, a former treasury official, to the post.

Mr. Simons, a former Cold War codebreaker who founded Renaissance in 1982, also takes a step back from the Simons Family Foundation, which sponsors research in mathematics and the basic sciences.

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