Anthony Scaramucci is a guy who knows how to make headlines. Not the kind of self-induced headlines his former boss, Donald Trump, is fond of generating. In Scaramucci’s case, they just seem to happen, the byproduct of his vigorous professional lifestyle. Some of them are financial in nature, others political. Some are good news, others bad news. But even his misfortunes seem to eventually be parlayed into good fortunes.
Scaramucci exploded on the national scene when then-president Donald Trump — largely at the urging of Jared Kushner and Ivanka Trump, to whom Scaramucci was close — named him the administration’s communications director, a position Scaramucci’s background didn’t suggest as a proper fit.
He was not entirely new to politics, having spent the previous 12 years working on behalf of the GOP, chiefly as a fundraiser and policy strategist. He was named to the Trump administration’s presidential transition committee, one of about 16 individuals on the team. Later, he was tapped to become director of the White House Office of Public Liaison, a fairly prestigious position that involved serving as chief networking officer for the president, but he was passed over when then White House chief of staff Reince Priebus objected to the appointment for reasons never made clear to Scaramucci.
“He didn’t want me to have that job,” Scaramucci flatly intones.
In short order, though, the White House would again come knocking.
TALES FROM THE CRYPT
In the meantime, Scaramucci returned to full-time management of SkyBridge Capital, the alternative asset management firm he founded in 2005 and has most recently been a proponent of bitcoin and other digital assets and technologies. It is his dealings in that asset class that recently put him back in the headlines when he cut a $45 million deal with the now notorious Sam Bankman-Fried and FTX, only to watch SBF (as he is often referred to) and FTX implode seven weeks later under the weight of worthless crypto coin and wide-ranging fraud allegations. FTX creditors have lined up, including SkyBridge, which wants to reclaim the 30 percent equity stake FTX purchased before becoming insolvent.
(More to come on FTX and the White House.)
THE THIRD SYLLABLE
Scaramucci is a Long Islander — born and raised on the island as a Mets and Jets fan and committed to living the rest of his life there. He watched dazzling ABA and NBA legend Julius Erving play for the Nets when their home court was the Nassau Coliseum. He would be a fan of the Long Island-based New York Islanders NHL team if not for watching Eddie Giacomin lead the New York Rangers in their battle against the Boston Bruins in the Stanley Cup finals.
“I live in the town of Manhasset, 2.5 miles from my parents’ house in Port Washington,” he says. “It’s me, Sean Hannity, Billy Joel and Bill O’Reilly.”
As though his polysyllabic surname wasn’t a dead giveaway, Scaramucci says he was raised in a middle-class Italian family. It was during second grade that he was tagged “Mooch” by a physical education teacher who struggled with his students’ polysyllabic Italian surnames. He cut a single syllable out of each student’s name to create a nickname. In Scaramucci’s case, he landed on the third of four syllables and dubbed him Mooch. His friends liked it too, and the name stuck.
His father was a crane operator in the construction business and his mother a traditional homemaker. The religion was Catholic, naturally, and parental rules were strictly enforced by a father who, as a man of his times, favored corporal punishment to keep the offspring in line (a practice Scaramucci has eschewed in the raising of his own five children). Despite being raised in a strict household, Scaramucci looks back on his childhood fondly.
“It was a great upbringing and I got very lucky,” he remarks. “I was in a very good public school system, I did well academically and was able to get myself into Tufts and Harvard. Those were big decisions at that time because the family didn’t have a lot of money and the guidance counselors in the public school referred my parents to one of the state universities because of our income. But I made the decision to go to Tufts and make a bet on myself. I think that made a big difference.”
Among other characteristics, Scaramucci inherited his father’s work ethic as a man who got up early each morning, “worked his ass off” and never complained. From his mother, he inherited his math and analytic skills.
Scaramucci enrolled at Tufts University in Medford, Mass., to study economics without a clear vision of how he would apply that education in the professional world. He spent half of his junior year at the London School of Economics. Still, his professional goals remained “fairly amorphous.”
“I didn’t really have an identification of what I wanted to do, until my junior year when I learned that starting salaries for law firms were $65,000 a year,” he recalls. “My dad was making about $30,000 as a construction worker, and I remember thinking to myself, ‘This is more money than my dad makes by a factor of two. I am going to go to law school and that will solve any financial anxiety that I might have in the future.’ I would like to tell you that it was more analytical than that, but it really wasn’t.”
What Scaramucci learned in law school was that he didn’t want to be a lawyer. Rather, he found his way to Goldman Sachs and became an investment banker, where he turned in a “terrible” job performance and was fired before he reached two years and was shown the door with an $11,000 severance check in hand.
“It was humiliating. I was a walking junk bond,” Scaramucci likes to say.
He started looking for new work, only to find there was a job opening at Goldman Sachs in sales. He called the Goldman executive who had fired him and was referred to the proper person for the job. Scaramucci was rehired by Goldman on March 28, 1992, and applied his skills to much greater effect this round. He remained with the Wall Street firm until 1996, when he co-founded Oscar Capital Management, an asset and fund management company.
In 2001, Oscar Capital was sold to Neuberger Berman, and upon Neuberger Berman’s sale to Lehman Bros. in 2003, Scaramucci served as a managing director in the firm’s investment management division, until departing in 2005 to establish SkyBridge Capital.
It was at Tufts that Scaramucci made the acquaintance of a professor named Sol Gittleman, now 88 and still in contact with his once wayward student. Gittleman recognized that Scaramucci had good grades and ranked as a good athlete but wasn’t applying himself with the kind of intensity that led to professional success. Gittleman called him on his lackluster academic effort. The professor’s words landed like a Nolan Ryan fastball and permanently changed Mooch’s attitude.
“He rang my bell and gave me a big wakeup call that I had to take certain things more seriously,” he recounts. “He also helped me build some really good habits for success and lit a spark intellectually for me, which I still have to this day.”
Other mentors included Bob Castrignano, Scaramucci’s boss at Goldman Sachs, and Dick Grasso, former CEO of the New York Stock Exchange. Scaracmucci and Castrignano, now in his early 70s, are close personal friends, and Grasso is a person Scaramucci still contacts on occasion.
“I don’t talk to him every day,” he says of Grasso, “but I could pick up the phone and call him right now and the conversation would pick up like we had talked two minutes ago. He’s somebody I have a lot of respect for and look up to.”
THE INTERVIEW HEARD ROUND THE WORLD
When the Trump administration named Scaramucci the White House communications director, he found himself facing a contingent of reporters while standing at the lectern in the White House briefing room. He looked the part: the dapper suit, the well-coiffed hair, the articulate statements and ripostes.
Still, things went sour when he did a phone interview with New Yorker reporter Ryan Lizza, who recorded and then released to the public their blunt conversation, during which Scaramucci used salty language in discussing some of the people he considered vipers in the Trump administration nest, particularly Reince Priebus and chief strategist Steve Bannon, both of whom he accused of leaking to the press. He found Bannon, who is facing prison time for contempt of Congress, particularly toxic and self-serving.
Scaramucci thought the conversation was off the record, but Lizza told him the information needed to be reported, releasing details of the interview in print while also sharing the audio recording with other media outlets. The nation listened with rapt attention as the White House communications director remarked: “I’m not Steve Bannon. I’m not trying to suck my own c--k. I’m not trying to build my own brand off the f--king strength of the president. I’m here to serve the country.”
While many cheered how sharply Scaramucci flushed out Trump backstabbers, his profane condemnation made it impossible for the administration to keep him in the post. Only 11 days on the job and the communications director was forced to resign. Despite the dustup, Scaramucci expresses no hostility toward Lizza.
“I want to be as objective as possible. I knew him and his family, my dad had a 50-plus year relationship with his family. We are fellow Italian Americans on Long Island, and I thought I was talking to him off the record. In fairness to him, I did not say, ‘This conversation is off the record.’ I was having what I thought was a casual conversation with him, and I laced it with a little bit of Long Island fun. He decided to take it to CNN. I said to him, ‘Wow, that is very transactional of you and inappropriate.’ I got fired. I took it like a man. I don’t blame anybody but myself. I trusted a person I had a relationship with.”
Unbowed, Scaramucci remains direct in his opinions and analysis of others, including Trump, who he speaks candidly about during national political programs. To Real Assets Adviser he said: “I had a good relationship with President Trump, but anybody who calls themselves a friend of Donald Trump either doesn’t understand the relationship or is trying to exaggerate their relationship. I don’t think he has friends the way normal people have friends, but I was a good enough acquaintance of his, and I think he felt that I was a straight shooter. We got along well enough. But if he runs again, I will work very hard to prevent him from winning.”
Scaramucci is quick to be self-critical as well. “I did something very egocentric and shortsighted, accepting a job that, ultimately, wasn’t the right job for me. I am really not a communications director; I didn’t have that kind of experience. I didn’t have the D.C., inside the beltway communication chops or gravitas.”
BOOM AND BUST
Scaramucci counts his ill-fated White House stint as the most traumatic experience of his professional life, yet not the only one.
Though small in hindsight but monumental at the time, there was the $50,000 loss he incurred on a margin account that his boss magnanimously agreed to cover. Scaramucci fancied himself a biotech guru at the time and had placed the bet on Centocor (now Janssen Biotech), a company working on an early-stage sepsis drug.
Far more egregious was the FTX deal, the implications of which are still playing out.
On the flipside, among his best professional experiences was SkyBridge Capital’s $4.2 billion acquisition of the hedge fund unit from Citigroup in April 2010. Citigroup sold the unit seeking to streamline its operations, while for SkyBridge the deal boosted its assets under management from $1.4 billion to $5.6 billion.
“It has been our belief for several years that the integration of a fund of hedge funds business is a natural fit with the SkyBridge platform, and this deal is a result of our long-term strategy to acquire assets that maximize value for investors,” Scaramucci was quoted explaining at the time.
Despite some spills along the way, Scaramucci has done well financially, though he counts himself as a modest spender. Other than some high-end automobiles — a Rolls-Royce Cullinan, a Mercedes-Benz G-Class SUV, and a burgundy 1979 Camaro — and homes in Manhasset and Southampton, Scaramucci focuses his spending priorities on those closest to him.
“Number one would be my family, my children, my mom and dad, my immediate family members and my relatives — first cousins and so forth are priorities for me,” he says. “I don’t want to be living a highfalutin lifestyle while my family members are struggling.”
Scaramucci’s prescription for success: Be willing to delay gratification, dream big, work hard and be aware there is a lot of risk involved in growing a business from zero to something meaningful.
“It has really never been about the money for me, it has been more about the journey when I look back on my career. I created the SALT conference, I probably have a Rolodex of 25,000 people — many of them very high-profile people. Life is better and enriched by relationships more than anything else.”
The SALT conference, most recently staged in Singapore, is a global thought leadership and networking forum that brings together leaders in finance, technology and public policy. U.S. presidents, Fed chairmen and captains of industry attend and speak at the prestigious conference.
TAKING THE LEAD
As though giving a boost to one of his favored asset classes, Scaramucci likens his leadership style to the blockchain. “Decentralized” is the operative word here.
“I delegate a lot of responsibility and allow people to run things,” he explains. “If something goes wrong, I want them to know that I’m there for them; I shield people from the fallout as opposed to ascribing blame. I can take the heat.”
The heat came down at an extreme temperature recently, when FTX collapsed. Scaramucci is working to recoup the 30 percent equity stake FTX acquired. He acknowledged during an interview with CNBC that he had been duped despite what he thought was sufficient oversight regarding the deal.
“If you’re running a background check on somebody like Sam Bankman-Fried, you’re not going to find anything,” he said. “He was unblemished prior to this incident. Remember, he was giving me the money, so I was doing a lot of due diligence on him, but clearly not enough.”
Scaramucci and SkyBridge entered the deal thinking SkyBridge would help FTX build a next-generation cryptocurrency exchange, with SkyBridge acting as an asset management sidecar. Those turned out to be failed aspirations.
“We didn’t do any wrong. We operated with high integrity,” Scaramucci says, “and SkyBridge itself is well capitalized.”
More broadly, Scaramucci recognizes the mammoth FTX collapse and its domino effect on hundreds of related companies has created a negative buzz around digital assets.
“Until that sentiment changes, we are going to have a little bit of a hard time,” he concedes. “I am an optimist, but I’m also a realist.”
He remains committed to a positive future for the blockchain, cryptocurrencies and digital assets in general.
“I could be wrong, I have been humbled by life and I have been humbled by markets, so I’m not sitting here with any level of smugness, but I believe we are in a temporary, some of it the result of fraud, some of it the result of overleverage, some of it the result of the Federal Reserve’s decision to raise interest rates,” he says. “This stuff will recover. In the meantime, people get very pessimistic at the bottom.”
Scaramucci harkens back to the dot-com bust when the Nasdaq lost 70 percent of its value in a tech slump that persisted for almost three years, during which investors swore off technology and tech stocks, only to miss one of the greatest investment plays in U.S. economic history.
“Let’s see what happens,” he says regarding digital assets. “I am going to be in it. My guess is that when it recovers, it will surprise a lot of people.”
TWIST OF FATE
If the FTX debacle ends up working out for Scaramucci, it will be yet another example of bad fortune yielding to a better fortune. Even something as high-profile as his swift dismissal from the White House resulted in a silver lining.
“My firing raised my profile and got me into a lot of fun things, including some reality television shows,” he says. “I have written six books, and I’m on the public speaking tour. Let me put it this way: A lot more people know of me today than they did prior to the White House. I think it has been, by and large, a good thing for me.”
Count it as yet another headline for the Mooch.
Mike Consol (email@example.com) is senior editor of Real Assets Adviser. Follow him on Twitter (@mikeconsol) and LinkedIn (linkedIn.com/in/mikeconsol) to read his latest postings.