Irrational Exuberance

Harris Kupperman's Praetorian Capital seeks out hysteria in every corner of the market, from bitcoin to natural gas.

Occasionally the best seed capital for a successful career in investing is lucky timing. In 1997, as a junior in high school, Harris Kupperman began obsessing over the stock market as the Asian financial crisis and then dotcom mania dominated the headlines. By the time he arrived at Tulane University two years later, tech stocks had soared nearly 200% since Netscape's IPO in the summer of 1995 and would double again over the next few months. The future hedge fund manager noticed that many of these dot-coms ultimately crashed when VC lockups expired and early investors dumped their shares.

In early 2000, Kupperman, known to his friends and peers as "Kuppy," took the $6,000 he had earned over the summer cleaning pools on the North Shore of Long Island and began buying put options-effectively shorting the stocks-of dotbombs like Commerce One and Foundry Networks. When the bubble popped in March 2000 and the Nasdaq fell 80%, he made a small fortune.

"I had a few thousand dollars in my account at the beginning of the year, and at the end of the year I had a few hundred thousand," boasts Kupperman, who is now 41. It opened my eyes to the potential that if you think harder than the other guy, you can make a lot of money.”

Two decades later, his Praetorian Capital has 180 million under management and is up 593%, net of a 20% performance fee and 1.25% management fee since it began taking in outside capital in 2019. During both 2020 and 2021, his fund, which makes concentrated bets in only about a dozen investments, returned more than 100%.