Meta, the Washington-based automated trading firm launched in 2017 by former top mortgage executives David Marcus and John Gibbs, is seeking to find a buyer for the company after its founder, Marcus, decided to leave, sources told the Washington Post.
Marcus, Meta’s president and CEO, was the former head of PayPal, where he helped build the online payments platform into a Silicon Valley darling before he was canned from the top job for failing to persuade the company to publicly state that Bitcoin was no better than silver coins. The former PayPal executive started Meta a year ago with an eye toward bringing his company’s algorithmic trading platform to corporate clients. The company operates its own trading floor and has executives on its staff who know more about algorithmic trading than any of their mutual fund counterparts.
But Marcus’ inability to make Meta a success outside the realm of high-frequency trading has led some observers to have doubts about the company’s leadership. While many investors are excited about the company’s technology, they are waiting to see how Meta will deploy its services to institutional clients in a sustainable manner.
“David may or may not have already decided that the New York office has earned a place in the company’s portfolio. He may or may not have made a decision about the continued existence of the San Francisco office,” said Jeremy Castor, an executive partner at New York-based funds firm Balyasny Asset Management, in an email to the Post.
Marcus told the Post that his team is finding its footing, however. “I am in the early stages of talking to major players about exploring their interest in Meta,” Marcus told the Post. He declined to name the potential buyers. Marcus did not respond to a request for comment from the Post about the status of the company.
Balyasny, the firm Castor is at, agreed to participate in a seed round to put Meta through its paces, sources said. The company raised $85 million last year from some big players in the tech industry, including AOL co-founder Steve Case, Cisco Investments, Clearlake Capital Group, Viking Global Investors, Permira Funds, and Hellman & Friedman.
There was talk that Meta would remain based in Washington but soon its offices were moved to the San Francisco area to accommodate the influx of executives and employees, one source said. The company hired as many as 100 people in the Bay Area over the past year, according to the Washington Post.
Shortly after Marcus was terminated from PayPal, he appeared as a guest on “The Breakfast Club,” the popular morning show, to discuss what went wrong at PayPal. Marcus blamed his boss, Dan Schulman, for his ouster. “We pushed information out so fast that Dan felt that he could move faster. That wasn’t the case,” Marcus said. “He wanted to accelerate those momentum bets and we were just holding him back.”
Marcus didn’t sugarcoat his successor’s job. Schulman, he said, did a terrible job of informing the company’s employees of the perils of capitalizing on Bitcoin. “There are certain things that you can’t know until you try, and one of them is that today is tomorrow, tomorrow is today, the same as yesterday,” Marcus said. “If you’re really in denial about technology, it’s kind of like f— you.”
Marcus came to the nation’s capital in the spring of 2016 after buying a penthouse in the Dupont Circle neighborhood and joining up with Cyrus Massoumi, another PayPal executive who was then president of financial institutions. Massoumi left the company soon after Marcus did, to start his own tech company.