Even for activist investors, hedge fund manager Dan Loeb is controversial. No one accuses Carl Icahn of playing with kid gloves, but Loeb’s attacks can be particularly vicious and personal. Most people reading this site are probably well aware of Loeb’s high-profile fights with Bill Ackman, Sothebys (NYSE:BID)’s CEO William Ruprecht and others, but William Cohan’s takedown piece in Vanity Fair is still a fun read just for the amount of dirt he convinces Loeb’s former friends and colleagues to spill (much of it anonymously).

Dan Loeb Third Point Reinsurance

Dan Loeb’s letters

“I think he’s got a bit of a Napoleonic thing. And I think he’s a very calculating, Machiavellian guy,” says one competitor. “[Loeb] can write the most obnoxious letters on the planet, make up shit—[because he does] not really care … whether or not you hurt people or don’t hurt people. You just don’t care. The only thing you care about is making money on their stock,” said someone who used to work with him.

Probably the best, from an unnamed hedge fund manager: “Loeb is the Kanye of Wall Street —crazy insecure despite enormous success and celebrity.”

Ackman – Loeb confrontation

But it’s the anecdote about Loeb running into Ackman at an Oscar party after the Herbalife Ltd. (NYSE:HLF) short-squeeze had played itself out that is probably the most telling. When Ackman confronted him about the move, Loeb shot back that he’d made $50 million off the deal, implying that profit justifies everything else.

In general, we’re more interested in fund managers’ investments than their personalities, though it can be hard to separate the two when reading one of Loeb’s letters.

Some of the people quoted in Cohan’s piece seem to imply that Loeb has been successful just because he’s tenacious and meaner than everyone else in the room, but this really doesn’t wash. If everything Loeb wrote was unfounded vitriol, the market would learn to ignore him. It’s precisely because he’s such a good investor that people have to consider what he says (and dismiss some of it to be sure). He might be willing to do and say things that other people wouldn’t, but anyone who thinks that’s the sole basis of his success is underestimating him.