Physicist Makes 'Big Bang' at Citi
FYI
OCTOBER 6, 2009
Physicist Makes 'Big Bang' at Citi
By DENNIS NISHI
Hamid Biglari went from physics to finance.
out of the Wall Street Journal
communicated by John Rudy
OCTOBER 6, 2009
Physicist Makes 'Big Bang' at Citi
By DENNIS NISHI
Hamid Biglari went from physics to finance.
Born and raised in Teheran, Hamid Biglari came to the U.S. in 1977 to study mathematics and physics at Cornell University.
Eager to participate in Iran's economic growth during the seventies, Dr. Biglari planned to return in Tehran after getting degrees from Cornell University. The 1979 Iranian Revolution derailed his plans. He realized that his career opportunities would be limited in the new regime so filed for permanent residency in the U.S.
He was fascinated by the idea of extracting energy out of seawater, a process known as nuclear fusion, so he went on to earn his Ph.D. in astrophysics at Princeton in 1987. He became a theoretical physicist at the Princeton Plasma Physics Laboratory.
While there, he wrote an influential paper about improving the efficiency of an experimental fusion reactor called a Tokamak. "It's one of the most cited papers in our field," says former colleague Greg Hammett, a researcher and lecturer at Princeton who believed Dr. Biglari was on track to become a leading researcher in plasma physics.
He was fascinated by the idea of extracting energy out of seawater, a process known as nuclear fusion, so he went on to earn his Ph.D. in astrophysics at Princeton in 1987. He became a theoretical physicist at the Princeton Plasma Physics Laboratory.
While there, he wrote an influential paper about improving the efficiency of an experimental fusion reactor called a Tokamak. "It's one of the most cited papers in our field," says former colleague Greg Hammett, a researcher and lecturer at Princeton who believed Dr. Biglari was on track to become a leading researcher in plasma physics.
Citigroup
Dr. Biglari believes in reinventing himself when he is 'on a high note.'
Cold War's End
But his career soon took a different turn. When the Cold War ended, defense spending, which had subsidized nuclear research since the Manhattan Project, shrank, pushing many scientists into other careers such as business and law. Dr. Biglari survived budget cuts at Princeton, but he believed the retrenchment by universities would stunt sustainable-energy research as well as his career.
While mulling his next step, the emerging markets of the former Soviet Union caught his attention. He thought global finance would be a promising and interesting field.
He had no business experience, but cold-called management consultancy McKinsey & Co. to ask for a job. He managed to sell them on his analytical skills and understanding of complex predictive computer models, which were then beginning to be used in finance to assess risk. They hired him as an associate, and Dr. Biglari made partner in four years, soon leading McKinsey's investment banking practice and Ph.D. recruiting program, he says.
Dr. Biglari believes in reinventing himself when he is 'on a high note.'
Cold War's End
But his career soon took a different turn. When the Cold War ended, defense spending, which had subsidized nuclear research since the Manhattan Project, shrank, pushing many scientists into other careers such as business and law. Dr. Biglari survived budget cuts at Princeton, but he believed the retrenchment by universities would stunt sustainable-energy research as well as his career.
While mulling his next step, the emerging markets of the former Soviet Union caught his attention. He thought global finance would be a promising and interesting field.
He had no business experience, but cold-called management consultancy McKinsey & Co. to ask for a job. He managed to sell them on his analytical skills and understanding of complex predictive computer models, which were then beginning to be used in finance to assess risk. They hired him as an associate, and Dr. Biglari made partner in four years, soon leading McKinsey's investment banking practice and Ph.D. recruiting program, he says.
Another Change
In 2000, Dr. Biglari was ready for another change. "I've always believed the best time to reinvent yourself is when you're on a high note as opposed to when in decline," he says. "Your options are larger that way."
Through his contacts he arranged a meeting with then Citigroup Chief Executive Sanford Weill and former secretary of the treasury Robert Rubin. This was two years after the marriage between Citicorp and Travelers Group had created Citigroup Inc. Both executives were impressed with Dr. Biglari's drive and offered him a job. Three years later, he became chief operating officer of its global investment-banking and trading and sales arm.
The financial-services industry began to unravel in the summer of 2007, says Dr. Biglari. Heavy losses would eventually lead to government intervention, massive layoffs and a dramatic reshuffling of the management ranks, including Vikram Pandit's ascendancy into the chief executive's chair at Citigroup in December.
In 2000, Dr. Biglari was ready for another change. "I've always believed the best time to reinvent yourself is when you're on a high note as opposed to when in decline," he says. "Your options are larger that way."
Through his contacts he arranged a meeting with then Citigroup Chief Executive Sanford Weill and former secretary of the treasury Robert Rubin. This was two years after the marriage between Citicorp and Travelers Group had created Citigroup Inc. Both executives were impressed with Dr. Biglari's drive and offered him a job. Three years later, he became chief operating officer of its global investment-banking and trading and sales arm.
The financial-services industry began to unravel in the summer of 2007, says Dr. Biglari. Heavy losses would eventually lead to government intervention, massive layoffs and a dramatic reshuffling of the management ranks, including Vikram Pandit's ascendancy into the chief executive's chair at Citigroup in December.
Citi's Split
After a fourth-quarter 2008 loss of $8.3 billion, Citigroup moved to split into two different entities: Citicorp would handle the retail banking and investment operations while Citi Holdings would have the riskier "noncore" assets. Mr. Pandit named Dr. Biglari vice chairman in charge of strategy and resource allocation for Citicorp. Dr. Biglari had already spent the past year restructuring the securities and banking side of the business. He says he is now working with Mr. Pandit to reframe the company.The pressure has been intense, but Dr. Biglari feels he is in the job that he has been working for since leaving physics.
"We're reshaping the business under the most challenging conditions imaginable," he says, equating Citi's challenges to those faced by former International Business Machines CEO Louis Gerstner in the 1990s. "In many ways IBM is the industrial equivalent of Citi," he says. "People were writing IBM off then but Gerstner completely reinvented the company. We, too, have to make the elephant dance."
After a fourth-quarter 2008 loss of $8.3 billion, Citigroup moved to split into two different entities: Citicorp would handle the retail banking and investment operations while Citi Holdings would have the riskier "noncore" assets. Mr. Pandit named Dr. Biglari vice chairman in charge of strategy and resource allocation for Citicorp. Dr. Biglari had already spent the past year restructuring the securities and banking side of the business. He says he is now working with Mr. Pandit to reframe the company.The pressure has been intense, but Dr. Biglari feels he is in the job that he has been working for since leaving physics.
"We're reshaping the business under the most challenging conditions imaginable," he says, equating Citi's challenges to those faced by former International Business Machines CEO Louis Gerstner in the 1990s. "In many ways IBM is the industrial equivalent of Citi," he says. "People were writing IBM off then but Gerstner completely reinvented the company. We, too, have to make the elephant dance."
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