Back in August, we reported that Bridgewater Associates was planning a round of job cuts, which the firm declined to confirm or deny. Today, we have a clue as to why: management was still figuring out how to brand the layoffs. And in a memo sent out to clients, it's been revealed-- this isn't around of layoffs, it's "renovation." Think of the cuts less as sackings and more as a long-needed gut-job to an historic Brooklyn Heights brownstone!
Sayeth Ray Dalio et al:
In a town hall meeting with employees today, we conveyed to the company that we will be conducting a renovation to improve efficiencies at Bridgewater, especially in the non-investment areas such as Technology, Recruiting, Facilities, and Management Services...To be clear, this renovation is coming at a time when our fundamentals are very strong: Our investment process is better than ever, our financial position is rock solid, our key employees who built the firm wouldn't want to work anywhere else, and our clients remain confident in us (as expressed in their collectively investing $22.5 billion in new money since 2015). We are making these changes as a part of the ongoing process of constant improvement that has been the key to our success over the past 40 years...The new management leadership is now digging into the areas of inefficiency to improve them. Naturally that will involve some significant changes to people, processes, and technologies. As mentioned, the vast majority of this renovation will be in the non-investment areas that have seen the most growth to make them more effective in supporting our investment and client service areas.
Beyond the linguistic gymnastics, our favorite part of the memo is when Bridgewater-- which prides itself on "radical truth and radical transparency" and records and archives all meetings "so that everybody can hear every conversation"-- says that normally it wouldn't have told anyone about the cuts but it had to because the media can't be trusted to report them without distortion.
In the past, we made these sorts of internal changes privately and wouldn't have bothered telling you about them as you won't be directly affected. However, we decided to bring them to your attention because we have recently experienced distorted reporting in the media about what is happening at Bridgewater, so we want to provide you the real story.