Background and career
David Alan Tepper (born September 11, 1957) is an American billionaire hedge fund manager, the founder and president of Appaloosa Management, a global hedge fund based in Miami Beach, Florida. He is also the owner of the Carolina Panthers of the National Football League (NFL) and Charlotte FC of Major League Soccer (MLS). He earned a bachelor's degree in economics from the University of Pittsburgh in 1978, and an MBA from Carnegie Mellon University in 1982. In 2013, he donated his largest gift of $67 million to Carnegie Mellon, whose Tepper School of Business is named after him. For the 2012 tax year, Institutional Investor's Alpha ranked Tepper's $2.2 billion paycheck as the world's highest for a hedge fund manager. He earned the third position on Forbes ''The Highest-Earning Hedge Fund Managers 2018'' with an annual earnings of $1.5 billion. A 2010 profile in New York described him as the object of "a certain amount of hero worship inside the industry," with one investor calling him "a golden god." In 2019, Tepper revealed plans to eventually convert this hedge fund into a family office.
Tepper was born on September 11, 1957. He is the second of three children of Harry, an accountant, and Roberta, an elementary school teacher. He was raised in a Jewish family in the Stanton Heights neighborhood of the East End of Pittsburgh, Pennsylvania. As a boy he “played football and memorized the baseball statistics on the backs of cards given to him by his grandfather—early evidence of what he claims is a photographic memory.” In a 2018 commencement address at Carnegie Mellon University, he revealed that his father had been physically abusive toward him. He attended Peabody High School in Pittsburgh's East Liberty neighborhood, followed by the University of Pittsburgh, helping pay his way by working at the Frick Fine Arts library. He received a Bachelor of Arts degree in economics and graduated with honors. He also began small scale investing in various markets during college. His first two investments, given to him by his father, were Pennsylvania Engineering Co. and Career Academies. Both companies went bankrupt. After graduation he entered the finance industry, working for Equibank as a credit analyst in the treasury department. In 1980, unsatisfied with this position, he enrolled at Carnegie Mellon University's business school to pursue its then-equivalent of an MBA, a Master of Science in Industrial Administration (MSIA).
After earning his MBA in 1982, Tepper accepted a position in the treasury department of Republic Steel in Ohio. In 1984, he was recruited to Keystone Mutual Funds, now part of Evergreen Funds, in Boston.
In 1985, Tepper was recruited by Goldman Sachs as a credit analyst, which was forming its high yield group in New York City. Within six months he became its head trader, remaining at Goldman for eight years. His primary focus was bankruptcies and special situations. He is credited with playing a major role in the survival of Goldman Sachs after the 1987 stock market crash. He bought underlying bonds in the financial institutions that had been "crippled by the crash”, which soared in value once the market picked up again. He assumed he would be made a Goldman partner but was passed over, partly because his “loud and profane” manner rubbed other more restrained Goldman executives the wrong way.
In December 1992, after being passed over for partner at Goldman Sachs twice in two years, Tepper quit. He began operating from a desk in the offices of mutual-fund manager and Goldman client Michael Price, aggressively trading his personal account in hopes of raising enough money to start his own fund. He created Appaloosa Management in early 1993. In 2001, he generated a 61% return by focusing on distressed bonds, and in the fourth quarter of 2005 he pursued what he saw as better opportunities in Standard & Poor's 500 stocks. Tepper “keeps the market on edge” and makes significant gains year after year by investing in the “diciest of companies,” such as MCI and Mirant. Investments in Conseco and Marconi also led to huge hedge fund profits for the company. In 2009, Tepper's hedge fund earned about $7 billion by buying distressed financial stocks in February and March (including Bank of America common stock at $3 per share), and then profiting from their recovery that year. $4 billion of those profits went to Tepper's personal wealth, making him the top-earning hedge fund manager of 2009 according to The New York Times. In a 2010 speech he recommended several supposedly risky investments, including AIG debt, Bank of America equity, and European banks. Citing experts who predicted hyperinflation or depression and deflation, he argued neither would happen: “The point is, markets adapt, people adapt. Don’t listen to all the crap out there.” In June 2011, he was awarded the Institutional Hedge Fund Firm of the Year. In 2013, Forbes ranked him as top hedge fund earner of 2012, moving him up to the 166th wealthiest person in the world. Forbes listed Tepper as one of the 25 highest-earning hedge fund managers in 2013 and 2016. According to Forbes, Tepper has a net worth of $16.7 billion, as of 2022. The Bloomberg Billionaires Index ranked him as the wealthiest person in New Jersey. As per Forbes list of The Richest People In The World, dated 8 MARCH 2024, David Tepper ranked #94 with a net worth of $20.6 Billion. In January 2018, Tepper praised President Trump's corporate tax cuts, saying that the bull market still had room to grow and denying it was overvalued. “World growth is higher,” Tepper said. “There's no inflation. The market coming into this year doesn't look rich; in fact, it looks almost as cheap as coming into last year.” Tepper keeps a pair of brass testicles in a prominent spot on his desk, a present from former employees. He rubs them for luck during the trading day to get a laugh out of colleagues. In 2020, the largest parts of his portfolio are Alibaba with 13% and Amazon with 11%.
On September 25, 2009, Tepper purchased a 5% stake in the National Football League's (NFL) Pittsburgh Steelers.
