Kenneth Cordele Griffin (born October 15, 1968) is an American hedge fund manager, entrepreneur and investor. He is the founder, chief executive officer, co-chief investment officer, and 80% owner of Citadel LLC, a multinational hedge fund. He also owns Citadel Securities, one of the largest market makers in the U.S.
As of April 2023, Griffin had an estimated net worth of $35 billion, making him the 38th-richest person in the world. He was ranked 21st on the 2022 Forbes 400 list of richest Americans. He was included in Forbes‘s 2023 list of the United States’ Most Generous Givers, according to which he has donated $1.56 billion to various charitable causes, primarily in education, economic mobility and medical research.
Griffin has contributed tens of millions of dollars to political candidates and causes, usually Republican or conservative in ideology.
The bulk of Griffin’s fortune is derived from the money he’s made managing Citadel Advisors, the hedge fund firm he founded in 1990. It had about $52 billion in assets under management as of Dec. 31, 2022, according to the firm’s 2023 form ADV filing.
Griffin probably has about $9 billion in personal assets in Citadel funds. This is based on a 2022 Form ADV filing, ratings reports, his estimate of earnings in prior years, and discussions with a person familiar who didn’t wish to be identified because the information is private.
His ownership of Citadel’s hedge fund business is estimated at 85% based on ADV filings and ratings reports. It’s valued using the enterprise value-to-EBIT and enterprise value-to-sales multiples of publicly traded peers, based on financials included in an October 2022 Moody’s credit opinion. A 10% liquidity discount is applied.
Griffin is credited with 80% of Citadel Securities, his market-making firm. A June 2019 S&P Global Ratings report stated that he held an overwhelming majority of the company. It’s valued using the $22 billion valuation agreed to as part of a $1.15 billion investment from Sequoia Capital and Paradigm in January 2022. The figure was adjusted by 7.1% to account for its 2022 revenue growth. A 10% liquidity discount is applied.
Griffin’s personal real estate includes trophy properties in Chicago, New York, The Hamptons, Palm Beach, Miami, Hawaii, Colorado and London. They’re valued at their purchase prices as reported in Bloomberg News and the Wall Street Journal.
Griffin has liabilities of about $2 billion including mortgages, according to discussions with a person familiar with his financial situation who did not wish to be identified because the information is private.
A spokesperson for Griffin said the billionaire declined to comment on his net worth in March 2023.
Biography
Early life and education
Griffin was born in 1968 in Daytona Beach, Florida, the son of a building supplies executive. His father had various jobs, and was a project manager for General Electric. Griffin’s grandmother, Genevieve Huebsch Gratz, inherited an oil business, three farms, and a seed business.
Griffin grew up in Boca Raton, Florida, with some time in Texas, and Wisconsin. He went to middle school in Boca Raton and Boca Raton Community High School, where he was the president of the math club. In high school, Griffin ran a discount mail-order education software firm, EDCOM, out of his bedroom. In a 1986 article in the Sun-Sentinel, he said he thought he would become a businessman or lawyer and that he believed the job market for computer programmers would significantly decrease over the coming decade.
Griffin started at Harvard College in the fall of 1986. That year, one of his first investments was to buy put options on Home Shopping Network, making a $5,000 profit. He also invested in convertible arbitrage opportunities in convertible bonds. Despite a ban on running businesses from campus, Griffin convinced school administrators to allow him to install a satellite dish on the roof of Cabot House, a dormitory, to receive stock quotes. He also asked Terrence J. O’Connor, the manager of convertible bonds at Merrill Lynch in Boston, to open a brokerage account for him with $100,000 that Griffin had gotten from his grandmother, his dentist, and others. His first fund launched in 1987 with $265,000, days after his 19th birthday. The fund launched in time to profit from short positions on Black Monday (1987). Griffin graduated in 1989 with a degree in economics.
The billionaire personally stopped trading by 2005, telling Bloomberg Markets magazine that his staff was better at it than he was. The funds lost $9 billion in the 2008 financial crisis, a period during which he told Bloomberg News he gained 20 pounds. Citadel’s funds recovered all of their losses by January 2012, according to Citadel’s website.
Griffin is an active art collector, paying $60.5 million for Paul Cezanne’s “Curtain, Jug and Fruit Bowl” in 1999, then a record price for an Impressionist painting. He bought Jasper Johns’s “False Start” painting for $80 million in 2006 from music mogul David Geffen. In 2020, he paid more than $100 million for Jean-Michel Basquiat’s “Boy and Dog in a Johnnypump.”Griffin has given nearly $2 billion to a number of non-profit organizations including the University of Chicago, Ann & Robert Lurie Children’s Hospital and the American Museum of Natural History. The total includes $500 million he’s given to Harvard University, which renamed its Harvard Kenneth C. Griffin Graduate School of Arts and Sciences in recognition of his support in April 2023.In January 2022, Griffin’s market-making firm, Citadel Securities, announced an investment from Sequoia Capital and Paradigm that valued it at $22 billion.In June 2022 Citadel and Citadel Securities announced that they were shifting their headquarters to Miami from Chicago.
Career
After graduating in 1989, Griffin moved to Chicago to work with Frank Meyer, founder of Glenwood Capital Investments. Meyer allotted $1 million of Glenwood capital for Griffin to trade and Griffin made 70% in a year.
In 1990, Griffin founded Citadel LLC, with assets under management of $4.6 million, aided by contributions from Meyer. His funds made 43% in 1991 and 40% in 1992.
In the early 2000s, Griffin founded market maker Citadel Securities.
In 2003, aged 34, Griffin was the youngest person on the Forbes 400, with an estimated net worth of $650 million.
From the time of his second marriage to Anne Dias in 2003 until late 2009, Griffin was the lead investor in Aragon Global Management, a hedge fund run by his then-wife Anne Dias-Griffin. The fund was also seeded with money from Julian Robertson. Griffin lost 20% of his investment in the fund.
In 2006, Citadel acquired the positions of Amaranth Advisors at a steep discount.
During the financial crisis of 2007-2008, for 10 months, Griffin barred his investors from withdrawing money, attracting criticism. At the crisis’s peak, the firm was losing “hundreds of millions of dollars each week”. It was leveraged 7:1 and the biggest funds at Citadel finished 2008 down 55%, but rebounded with a 62% return in 2009.
From Citadel LLC, Griffin earned $900 million in 2009, $1.4 billion in 2014, $600 million in 2016, $1.4 billion in 2017, $870 million in 2018, $1.5 billion in 2019, and $1.8 billion in 2020.
In 2015, at his own expense, Griffin hired Katy Perry and Maroon 5 to entertain his employees.
In November 2020, according to Bloomberg News, Griffin’s net worth surpassed $20 billion due to an increase in the value of Citadel, of which Griffin’s stake was worth $11.2 billion. Citadel Securities, a market maker, increased its profit to $2.36 billion during the first half of 2020 compared to $982 million for the same period in 2019, due to increased volatility, volume and retail trader engagement.
In January 2021, Griffin attracted criticism for the role Citadel played in the GameStop short squeeze. On January 25, it was announced that Citadel would invest $2 billion into Melvin Capital, which had suffered losses of more than 30% on account of its short positions, particularly on GameStop. On January 28, Robinhood, an electronic trading platform favored by many traders involved in buying GameStop stock and options, abruptly announced that it would halt all purchases of GameStop securities except to cover shorts and would allow these securities to be sold only if already held (but not sold short); the price of GME stock declined steeply shortly thereafter. Because Robinhood receives a substantial portion of its revenue through a payment for order flow relationship with Citadel, 85% of which is owned by Griffin, many commentators criticized the potential for conflict of interest when the same entity both plays the role of market-maker and also participates in the market it makes; Griffin has been at the center of much discussion of this controversy. On February 18, 2021, he testified before the House Financial Services Committee about his role in the GameStop controversy; Griffin had donated money directly to four members of the committee, Republicans French Hill, Andy Barr, Ann Wagner, and Bill Huizenga.
Milestones
- 1987 Begins investing with $265,000 in capital out of Harvard dorm room.
- 1989 Graduates from Harvard University with a degree in economics.
- 1990 Hedge fund officially formed. Original name is Wellington Financial Group.
- 1994 Changes hedge fund name to Citadel.
- 1998 Citadel reaches $1 billion in investment capital.
- 2008 Citadel loses $9 billion amid bear market.
- 2012 Citadel funds recover their bear market losses by January of this year.
- 2014 Files for divorce from wife Anne Dias-Griffin.
- 2022 Citadel shifts its headquarters from Chicago to Miami.
- 2022 Citadel brings in record $16 billion profit for clients.
