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Wall Streeters' Minds Wanted to Help Jeremy Lin Win NBA Title
By Scott Soshnick
November 09, 2012 12:01 AM EST
Jeremy Lin of the Houston Rockets waves to the crowd after the game against the Atlanta Hawks at Philips Arena in Atlanta, Georgia, on Nov. 2, 2012 . Photographer: Scott Cunningham/NBAE via Getty Images

Houston Rockets point guard Jeremy Lin and his teammates may get an assist from Wall Street in their quest for a National Basketball Association championship.

General Manager Daryl Morey, a 40-year-old statistical analysis devotee, is seeking to fill two vacancies in his basketball operations department: an analyst and an intern. The team has received more than 1,100 resumes, about 20 percent from people working in finance.

“Wall Street folks are great at forecasting, at using objective evidence in decision making,” Morey, who holds a Master of Business Administration from the Massachusetts Institute of Technology, said in a telephone interview. “And they’re often overworked and miserable. The smart ones figure out it might not be worth it.”

Sam Hinkie, the Rockets’ executive vice president of basketball operations, said Wall Street applicants usually fall into one of three categories: the young and hungry with a passion for sports; those who’ve made a fortune and want to do something fun; and those who are willing to take a massive pay cut in exchange for a lifestyle alteration.

“That last one’s a little harder to get,” said Hinkie, who holds an MBA from Stanford University and whose resume includes a stint at Bain & Co.

The Rockets are offering $25,000 to $70,000 for the positions, depending on a candidate’s experience, said Morey, adding that the use of basketball analytics is probably only as advanced as baseball was in the 1990s.

Moneyball Approach

A number of Major League Baseball teams have adopted the statistical-driven, so-called Moneyball approach made popular by Oakland Athletics General Manager Billy Beane, whose premise is based on using statistics to exploit market inefficiencies. It was the subject of a book by Michael Lewis that was made into a movie that starred Brad Pitt as Beane. Lewis is a Bloomberg News columnist.

Analytics are being embraced by a growing audience. Nowhere is that more evident than at the MIT Sloan Sports Analytics Conference, which debuted in 2007 and is co-chaired by Morey and Jessica Gelman, a Harvard MBA who is vice president of customer marketing and strategy at Kraft Sports Group, which owns the National Football League’s New England Patriots.

About 150 people attended the inaugural conference, said the 37-year-old Gelman, who projects that attendance will top 2,700 for next year’s event March 1-2 in Boston. In all, 73 teams from the NBA, MLB, NFL and the National Hockey League, along with Major League Soccer and the English Premier League, will be represented, she said.

“Anyone who can work for Daryl should,” Gelman said via telephone.

Basketball Growth

Sig Mejdal, 46, surveys the sports analytics landscape and sees more people wanting work in basketball than baseball, which, he said, wasn’t the case a few years ago. Mejdal left his job at the National Aeronautics & Space Administration in 2005 for a chance to work with the St. Louis Cardinals. He’s since joined the Houston Astros, working as the team’s director of decision sciences.

He, like Morey, sees a connection between Wall Street and statistical analysis in sports.

“The econ and finance people are sensitive to pragmatic models -- models to the real world and all the constraints,” he said via telephone.

Most of the NBA’s 30 teams are making some sort of investment in statistical analysis, said Hinkie, who reviews every resume.

Statistics Commitment

Among the clubs most committed to statistical analysis are Mark Cuban’s Dallas Mavericks, the 2011 champions, and the 2008 champion Boston Celtics, whose assistant general manager, Mike Zarren, is a Harvard Law School graduate and former management consultant who performed econometric and other quantitative analyses for Fortune 500 firms. Cuban, meantime, is an investor in Synergy Sports Technology, which provides data and video to clients.

“Most every NBA team would say they have interest in making some kind of investment in this area,” Hinkie said.

But not all teams do it as well as the Rockets, says Jon Hennessy, 29, who re-enrolled in a Harvard statistics doctoral program after taking last year off to work for the team as an intern.

Statistical analysis aside, Morey has admitted to making a mistake with the twice-released Lin, whom the Rockets had, but let go, allowing him to eventually wind up with the New York Knicks. The undrafted Harvard graduate became a sensation in New York, where “Linsanity” helped to fuel ticket and merchandise sales for the Knicks.

“We should have kept @JLin7,” Morey posted to Twitter on Feb. 9, less than two months after releasing him in a payroll- clearing move. “Did not know he was this good. Anyone who says they knew misleading U.”

Another Chance

Morey and the Rockets got a second chance this offseason, when Lin was a restricted free agent. Houston signed the player with just 64 career games on his resume to a three-year, $25.1 million contract that the Knicks chose not to match.

Lin, 24, is averaging 13 points, 7.0 assists and 5.5 rebounds this season for the 2-2 Rockets, who made headlines Oct. 28 by acquiring reigning Sixth Man of the Year James Harden from the Oklahoma City Thunder. Harden is averaging a league-best 30.3 points this season. The Knicks, who added point guards Ray Felton and Jason Kidd, are unbeaten in three games.

Hennessy, meantime, said part of the fun was working for Morey, who in 1994, while at Northwestern University and working at Chicago-based sports information company STATS, Inc., invented a modified Pythagorean Theorem for football, hockey and basketball.

“Daryl is a visionary,” Hennessy said. “All the people there really love what they’re doing. If they had all the money in the world, they would still want to do this.”

Two Positions

That’s exactly what the Rockets want, Morey said. While there are two positions vacant, the club would create more if people worth hiring present themselves, said Morey, adding that the ideal candidate has done something to demonstrate his passion for sports analytics.

“It could be a blog, or maybe they’re using their free time to make themselves smarter in sports,” he said. “Combine that with success on Wall Street and you’ve got a great candidate.”

To contact the reporter on this story: Scott Soshnick in New York at ssoshnick@bloomberg.net

To contact the editor responsible for this story: Michael Sillup at msillup@bloomberg.net