The Billionaire's Apprentice Paperback – June 1, 2015

This is not a novel but it is every bit as gripping as any thriller you are likely to pick up.It was just a question of time before someone wrote a book about these historical business events and Anita Raghavan just happened to be the first. I am sure that there will be other books, possibly many other books but they will have a high bar to cross because Raghavan's book is so darn good - meticulously researched and compellingly written.There is no doubt that the business events discussed are highly significant. The former head of the world's premier consulting firm, who was on the board of many blue chip firms including the pre-eminent financial juggernaut, freely giving privileged information to a shady hedge fund operator - this is not an everyday scenario. Or maybe it is but it was certainly a deep secret and no other comparable case has surfaced as yet.This is an important business story by any yardstick. But there is a sub-text - many of the principals came from India, Pakistan, Sri Lanka and Bangla Desh so it also a story of South Asians and how they have risen from obscurity and hard-scrabble roots to the very top of establishment America. I am South Asian myself so this resonated deeply in a bitter sweet way. Yes, those convicted were South Asian, but so were those who prosecuted them and held them legally accountable for their transgressions. A true tale of immigrant progress.Raj Rajaratnam, a scrappy Sri Lankan born trader, started a hedge fund called Galleon Group and built it into one of the world's biggest and most influential. He managed billions of dollars and became a billionaire himself. He also lived the high life with private jets flying important customers to choice Super Bowl seats and exotic paid ladies at orchestrated events. For more on this see "The Buy Side" by Turney Duff. His enormous success owed much to a network of informers who fed him confidential information that he used brilliantly to juice his outsize returns. Rajaratnam had strong street smarts and a penetrating insight into human foibles that he used to ruthlessly manipulate persons.For example, Anil Kumar was a McKinsey Director and former classmate at Wharton. McKinsey directors live well but don't own private islands and helicopters to take them there. Rajaratnam commiserated with Kumar about his inadequate compensation, extolled his acumen and analytical abilities and then paid him a million dollars to make use of his "skills". This money was funneled through a foreign bank account in the name of his housekeeper - an arrangement both flimsy and illegal and this came back to haunt Kumar. Gradually it became clear to Kumar that the "skills" Rajaratnam needed was the information he was privy to in his capacity as a McKinsey consultant. He balked, but by them he had accepted the money and the trap was sprung and he started coughing up the information sought.The grand panjandrum was Rajat Gupta the thrice elected global head of consulting giant McKinsey who was perhaps one of the most respected executives in the world. He was on the board of Goldman Sachs, Procter & Gamble, American Airlines and firms of that caliber. The CEOs of both Gillette and P & G have said that the merger of the two firms would not have happened without mediation by Gupta who was both liked and trusted by both sides. He was very wealthy, but not wealthy beyond the dreams of avarice. Full disclosure: Rajat Gupta was a guest speaker at my course in Columbia Business School and what he said was so honest and inspirational that I also invited him to speak at my class at London Business School. He outlined a view of business behavior that resonated deeply with students and that I believe business badly needs. I am still struggling to reconcile what he said and his career at McKinsey with what he was accused - and convicted - of doing later.Rajat Gupta started several ventures with Rajaratnam some of which were successful and some which were not. Wire taps on Rajaratnam's phone showed that Gupta called him seconds after important board meetings - such as at the time of financial turmoil when Warren Buffet agreed to invest five billion dollars in Goldman. Rajaratnam's firm then made significant and highly profitable trades. A lot of circumstantial evidence but enormously strong and convincing to the jury which convicted him.Rajat did enormous good in many fields and was the force behind the Indian School of Business - one of the premier business schools in India. He was the iconic role-model of many Indians including those like Sanjay Wadhwa who, as deputy chief of the SEC's Market Abuse Section, investigated and built the case against him. Quite possibly Gupta also paved the way for South Asians like Preet Bharara, the US Attorney for the Southern District of New York, to reach the high positions they occupied. Bharara was the one who eventually convicted Gupta.Raghavan takes a Ken Follett approach in her book. If you read "Eye of the Needle" you will recollect that it goes back and forth in time and gradually ties all the characters together. Similarly Raghavan begins with a White House dinner for the visiting Indian Prime Minister, goes back to colonial India and Gupta's father's role in the freedom struggle, back to the US and Gupta's legal travails, back to India during the turmoil and bloodshed of partition and how Wadhwa's parents were caught up in it and so on. I just happen to like this approach and found that Raghavan converted a tale of high level business chicanery into a gripping narrative.The unanswered question is WHY? Why did Gupta, as accomplished and successful an executive as you can find, consort with persons of the ilk of Rajaratnam and readily give away confidential information?Rajaratnam's brother Rengan was quoted in the press as saying "For years these guys were sitting around in sports clubs and exchanging information. That wasn't a crime. And now we immigrants do the same thing and it is?" Presumably Rajaratnam believes this. Does Rajat Gupta also believe it?We do not know much about the rarefied circles in which Rajat mingled so comfortably. Was his behavior the outlier? Or the norm and his misfortune was that he got caught?I am waiting for the book that will shed light on this.

[ASIN:1455504025 The Billionaire's Apprentice: The Rise of The Indian-American Elite and The Fall of The Galleon Hedge Fund] This is a meticulously investigated and researched and imaginatively written book that takes us deep into the heart of insider trading on Wall Street. Featuring the rise of the South Asian community in the United States and the fall of the Galleon hedge fund, which took down two iconic figures and a colourful cast of supporting players drawn to insider trading in unexpected and strange ways, it can be read as a morality play on greed and akrasia. On the other side stand the antagonists, the unbending enforcers of the rule of law, who include key South Asian players with life stories as interesting as those of the law-breakers. I found the characterization of the main actors, and even of some of the bit players, strong and the depiction of varied motives persuasive. Several other themes, such as the Indian freedom struggle, talent, early hardship, hard work, and success, come together in a drama that has a startling ending. I won't spoil it for other readers by even hinting at what this might be. A very worthwhile read.

WSJ alum Anita Raghavan reveals in the Acknowledgements that she and her stellar agent, Shawn Coyne, had been searching for the "perfect way to tell the story that [Raghavan] had been wrestling with for years: the rise and maturation of the South Asian diaspora in the United States." Here, the duo have come up with the perfect vehicle: this tale of the Galleon affair has three protagonists with roots in the Subcontinent: ex-Galleon Group hedge fund founder Raj Rajaratnam; ex-McKinsey head Rajat Gupta; and (though a smaller part of the Raghavan's story), US Attorney Preet Bharara.The book is notable for its amazing insider detail and rich, nuanced portrayals of those three leads and a host of others. It is absolutely fascinating stuff. Raghavan completely nails her goals: here are children of Indian/Sri Lankan immigrants at the absolute peaks of their profession, the "maturation" and influence of the diaspora made manifest through brains, relentless networking and indefatigable effort.And, in the case of Rajaratnam, a little something extra: "Edge." Often 'edge' is simply outworking the other guy and having the iron gut to act of the information. Other times, edge is illegally obtained information, typically corporate insiders expertly nurtured by Rajaratnam.I think all readers of the book know the core story here: Gupta abusing his position on the board of directors at various companies; Rajaratnam collecting the information from him and various others; Bharara pursuing both of them. What makes the book fascinating is Raghavan's compelling case against Gupta (still professing a degree of innocence) and admiration for what Rajaratnam had built. The preponderance of circumstantial evidence she compiles against Gupta is overwhelming in its sheer weight. And, at the end of the day, she points out that Gupta still really didn't get it noting that "After more than two years of feeding him information, Kumar seemed to have little sense of exactly how Rajaratnam made his money. For someone so smart, Kumar had little understanding of how event-driven hedge funds like Galleon really worked."Meanwhile, despite the clear criminality of his edgiest edges, Raghavan says admiringly of Rajaratnam that "Unlike Kumar, the salaried consultant who got paid simply for showing up, Rajaratnam was an entrepreneur who built an investment empire with his very own blood, sweat, and tears. The ebullient markets in recent years made people forget about the hard work, long hours, and risks he had taken to create Galleon."This is a fascinating book about Wall Street and its characters. It's also a tragedy of two high-fliers brought low by overreach....and more than a fair amount of stupidity in the case of Gupta. The sheer lack of intelligence he shows here on these pages is stupefying. [By the way, this tale would make an epic miniseries.]

alles bestens

Excellent book if I was from Asia this would be a must read to understand western culture and the difference between Asian business practise and the formalized North American one. Both have flaws that can be exploited which create ethical challenges if a business person is not centered on honesty and the basis for it.

Great Journalism and a fantastic readExceptional book, well written, meticulously researched, gripping from the start and reads like a financial thriller.Anita Raghavan has written a fascinating twists and turns window into the world of consulting, hedge funds, insider trading and the investigative determination of the SEC/FBI.A helpful cast of characters is given at the beginning, followed by seamless weaving of the two detailed contrasting stories of the main protagonists Rajat Gupta and Raj Rajaratnam taking the reader on a journey from Mumbai and Kolkata, revealing family stories, background and more. The reader is then transported to the USA, another world entirely. Once started, I just could not put this book down!NB. I'm not an Indian-American just someone who appreciates an interesting and well written story.

Anita Raghavan has painstakingly written a well-researched book on the shenanigans that go on in the financial markets - in this case on the Wall Street in the New York city, involving Galleon hedge fund managed by a Sri Lankan Tamilian and Wharton Business School MBA, Raj Rajaratnam.Rajaratnam was an archetypal successful player in the financial market - intelligent, technically skilled, well informed, adept at networking and cultivating people, one who was given to cutting corners and covering his tracks, one who appeared to be helpful and generous to people but who was in fact wily, manipulative and treacherous and had a criminal bend of mind, a man with a huge ego, and one who was always greedy for money because money is the only measure of a person's success in life more in the hedonistic USA than elsewhere.Rajat Gupta, a highly qualified (IIT, Delhi and Harvard Busineess School) and experienced head of the blue-blooded, American management consultancy firm, McKinsey & Co. got ensnared during the stock market boom by the quick and easy success of various high net-worth investors and intermediaries operating on the Wall Street, including Rajaratnam, who had become a billionaire by trading in stocks. Given Gupta's high status as McKinsey's MD and his directorships of major American companies including Proctor & Gamble, and a leading investment bank namely, Goldman Sachs, Gupta should have never spoken to Rajaratnam, not even on the weather in Manhattan. But after his two successful terms as McKinsey's MD and when he was continuing to work for McKinsey as a partner, Gupta chose to do business with Rajaratnam in his personal capacity as an investor and potential joint-sponsor of an equity fund.What followed is a tragic story of what greed can do to an exceptionally high achiever and otherwise an intelligent, mature and level-headed person. As a convicted person, it has wiped out forever Gupta's credibility built over a 30-year, highly successful career with McKinsey. After two separate trials, Rajaratnam was sentenced for managing a fund that consistently out-performed the market because of insider trading, to 11 years in prison with a penalty, which he more than deserved. Gupta was sentenced to 2 years in prison with a US$5 million penalty. Moreover, SEC fined him US$13.9 million. The quid pro quo for providing insider information by Gupta to Rajaratnam was not established during the trial but the presiding Judge did not believe that it mitigated gravity of the crime.The book sets out in detail blow-by-blow account of the case and investigations. Gupta appealed against his sentence but, given the wire-tap and irrefutable circumstantial evidences, it is unlikely that he will be exonerated of the charge of compromising his fiduciary responsibility to shareholders and providing to Rajaratnam material, non-public information on various companies' working results to which he was privy as an independent director.An honest person is one who chooses to remain honest even when he is sure that there is no possibility of his being caught if he were to act dishonestly and benefit by it. Very sadly, inspite of his high academic qualifications, outstanding success in professional life and very comfortable financial position, Gupta failed that litmus test. By yielding to greed, he got himself involved with a seasoned crook like Rajaratnam and has paid a terrible price for it. Gupta cannot claim that he did not see through Rajaratnam. In the process, he has also sullied the image of well-educated and successful Indian community in the USA and given reason to Americans and other westerners to believe that Indians in general and even in high positions are not honest and trustworthy.The book is a good reading material for all those who are interested in the financial markets as also those who want to get rich quickly by playing the stock markets or those who are currently engaged in insider trading and absolutely confident that they will never be caught.

読み終わった時の感想は、やっと終わったとい達成感と同時に、もう終わってしまったのかという残念さ。400ページを超える大作ではあるが、今のアメリカで存在感を示しているインドからの移民によるインサイダー事件を中心に、マッキンゼーでトップにまで昇りつめた者とWall Streetでヘッジファンドで金持ちになった者がどのようにインド人社会を利用して私服を肥やしていったのか、またそれを暴こうとするFBIとSECの捜査が生々しく描かれている。インド人の特性とかたずけるか、アメリカ社会に巣食っている悪性と見るかは人によって判断が分かれるとこであろうが、作者自身もインド人であり、細かな描写によって、悪事に関わった人達の心の弱さ、傲慢さに光を当てて、これら登場人物個人の問題がインド人社会の同朋意識を悪用した結果と主張しているように私には感じられた。