In this interview, MDP co-founder Dennis Davitt shares some of his backstory, including his passion for automobiles, how his size has worked to his advantage both on and off the field, and how his mom’s illness shaped his childhood. He also explains how starting MDP helped him discover what’s broken in big banking culture.
How did your parents influence your view of the world?
I grew up in a small commuter town in New Jersey and was a very independent kid. I’d say that Bruce Springsteen was probably a bigger influence on me than my mom and dad were. That’s not me trying to trash my parents; I had two siblings who were much older than me, and my parents had bigger problems than worrying about their third kid. My mom was diagnosed with cancer when I was in second grade and became one of the first chemotherapy patients. That put a lot of stress on my family, and my dad had to work hard to make sure she could keep her healthcare coverage. Back then, insurance companies wouldn’t cover pre-existing conditions, so he wasn’t able to entertain changing jobs or starting his own firm.
How was it for you coping with your mom’s diagnosis?
As a six year old I didn’t really understand what was going on, beyond the fact that my mom was sick and was going into the city to get care. When she was diagnosed, they told her she had six months to live and that they were going to have to remove her legs to stop the melanoma from spreading. Thankfully, my mom’s best friend heard the news, and knowing that her husband’s client was Ken Langone, she helped get my mom the treatment she needed at Ken’s treatment center. In the end, my mom ended up living another 14 years. She was a survivor. The whole experience opened my eyes to the idea that someone on Wall Street could do more for my sick mom than a doctor could.
Some other good things came out of it too: it’s also how I discovered my passion for automobiles. As soon as I got my learner’s permit, I would drive my mom into the city for chemo in our Chrysler Cordoba. I have great memories of driving the streets of Manhattan with her as a 15 year old.
Talk more about how you became a car guy?
My high school friends would always joke how I had already bought and sold two cars before I had my driver’s license. There’d be neighbors getting rid of cars they couldn’t fix and so I’d buy them, do the repairs, and turn around and sell them. Now I live in Asheville, North Carolina, so I have to drive an F-150. My fun car is a 1975 BMW 2002. Ironically, I get more compliments on my 125 horsepower BMW than any of the fancy Porsches and muscle cars I’ve owned in the past. It probably helps that I have my King Charles Spaniel sitting next to me. If I could do it all over again, I’d only own sissy dogs and drive vintage BMWs.
Were you an athlete as a kid?
I played football and, like every kid in New Jersey, was on a swim team down at the beach. My claim to fame in football was that I was a mediocre player on a state championship team. Colleges would ask me to send them my tapes, and all I had were a few plays from the last two minutes of a game we were winning 30 to nothing. I learned what it was like to sit on the bench, and it was a good experience for me. With swimming, it was the opposite — I was a good swimmer on one of the worst teams. When I got to the Florida Institute of Technology, an engineering school with no football team, they saw a 6’5”, 220 lbs. linebacker and told me I’m on the crew team. They had a top-tier program and I ended up getting a pretty large scholarship to row there.
At FIT, were you planning on pursuing a career in Wall Street?
I was good at math and I actually went to FIT to become a civil engineer. I had an interest in Wall Street from all the wacky stories I’d hear about, but when I started college it wasn’t yet the cool place to go. That said, as time went on, I started noticing that my engineering friends who had graduated were shifting gears to get their MBA instead of practicing engineering. That was the time computers were taking over, and entry level engineering jobs were harder to come by. The writing was on the wall, and so I switched over to the business school.
"That was the time computers were taking over, and entry level engineering jobs were harder to come by. The writing was on the wall, and so I switched over to the business school."
How did you break into the industry?
The market crashed in ‘87 and I graduated in ‘88. Fortunately for me, the area of the market that I wanted to get into was blamed for the crash and there were plenty of job opportunities. I got started working in New York for guys who traded commodity options. I’d like to think my big brain helped me get the job, but my big ass was probably just as important. Being able to physically push through crowds of people was a big part of the job.
What was it like working in the trading pits?
It was the place to be. All of the information lived on the floor and it was where the most money was made. If you imagine it as a wheel, information would have to travel down the spokes to the hub (the pit) and travel back out. When electronic trading took over information started flowing in the opposite direction. I transitioned to the outside of the wheel, so to speak, when I went to Credit Suisse to be a risk manager in 2000.
"It was the place to be. All of the information lived on the floor and it was where the most money was made."
Were there any important mentors who helped you in the early part of your career?
The floor community in general was responsible for most of my education. If I had to be more specific, there was a team of guys from O’Connor who took me under their wing as they were refining the Black-Scholes model and putting it to use. When I was at Credit Suisse there were also some really great guys I worked with who taught me about structured products.
One thing I learned as I started working at larger firms later in my career was that asking to be brought up to speed on something was considered to be a sign of weakness. I noticed that people seemed to be more concerned about their own position than their firm’s success. That’s a big part of the reason I started MDP. My partner Mike McCarty knows more about ETFs than anyone I know, and I ask him questions every day. I’m constantly learning from our institutional investors and I’m not shy about asking them for advice. It’s great being part of a culture where I don’t have to pretend to know everything.
"I’m constantly learning from our institutional investors and I’m not shy about asking them for advice. It’s great being part of a culture where I don’t have to pretend to know everything."
What do you like to do in your free time?
I’ll let you know when I have some! My wife is a ridiculously good cook, and I’m trying my best to keep up with her. We’re also spoiled with all of the amazing restaurants we have in Asheville. I think we may have more James Beard chefs per capita than any other city in the country.
Favorite vacation spot?
Our best family trip had to be when we spent a month in Kauai. It’s such a cool ecosystem. We almost didn’t come back.
What do you like to read?
My son is into rowing now and it’s inspired me to start revisiting all of the great books about rowing. Some of my favorites are The Boys in the Boat, The Shell Game, and The Assault on Lake Casitas. We’re reading some of them together, and that’s been fun.
