that the Internet makes possible.

convenient fashion.

is founded and financed with their own money. In addition to Migdal

and Danko they include Howard "Ward" Tomlinson, executive

vice president, a 1975 alumnus of Princeton University who headed

the mortgage-backed specialist sales effort at Bear Stearns. He had

a medical supply company that he sold two years ago.

Michael Agishtein, who had studied with Migdal in both the Soviet

Union and at Princeton, is vice president of technology. He received

political asylum in the United States, where he is now a citizen,

and has a PhD in applied mathematics from Princeton University. He

has also been vice president of technology at Hammond Maps Inc. and

a consultant for Digital Equipment Corporation.

"We did an exciting licensing deal with Telescan and are co-developing

products with them," says Danko. Telescan, a public company in

Houston in the financial services content business, owns 19 percent

of Tachyon. With its online financial tools in use by Fidelity Investments,

Citibank, American Express, CNBC, Time Inc, and Standard & Poor’s,

Telescan staked out a piece of Tachyon early in the game (www.wallstreetcity.com).

"As a company we are making decisions now on how to best take

a product in late beta testing and market it to the world," says

Danko.

Just what is the appeal of this product, called FalconEye? (www.falconeye.com) "We

found a way to broadcast and retranslate only the strategic information,

and there are as many choices as there are clients. We have a dedicated

line and stream over the Internet with only those alerts that people

need. It will be like the difference between having the interactive

TV set in your home — or have the TV station at your home,"

says Migdal, "a huge difference."

Migdal says Tachyon’s only current competition is MarketMap,

but he likens it to the difference between a movie and a slide show.

MarketMap updates every 15 minutes, not in real time, and is not zoomable.

"It is not changing while you see it, just updating every now

and then." Pared-down and understandable information to empower

both brokers and consumers doing their own online trading can include:

real-time charts, alerts, and analytics of 6,500+ Nasdaq stocks, FalconEye

provides insights into a market that neither the institutional brokers

nor the E-brokers can give you," says the website.

applications using streaming Java programming technology. "Since

it’s a true on-line application," says the promotional material,

"all you need to use Falconeye is a current browser.

brokers and E-brokers have projected a lack of respect for the individual

investors who desire the best analytical information. You don’t have

to take it anymore! Now you can access detailed market information

yourself and make your own investment decisions."

an active stock, the specialist gets all of the buy and sell interest

and decides where the market is going to be and where the trades will

be done, on the bid side and offer side. The specialist is selling,

and the specialist is also taking risk and had better be right. He

is constantly looking for the market-clearing level and has no data

to analyze, except buy and sell numbers."

"On Nasdaq, it is basically every firm for themselves. Innumerable

market makers are putting in different bids. You can pay for `bids

and offers’ information but looking at this sea of information is

quite a daunting task. It is too much data," says Danko. "All

you can do is look at it with your eyes. We figured out how to crunch

all the data in real time and analyze it any way you want to."

Nasdaq has three levels of information. Level 1 workstations have

basic "bid and ask" data with price, volume, time of bid and

time of ask. Level 2, no longer anonymous, reveals all the market

makers on both the buy and sell sides, plus the actual size of the

bid or offer and the price. Level 3 is each broker’s proprietary order

flow and this information is available only to that broker.

Most investors do not have access to level 2 information, but the

market is not transparent without that information, and it is starting

to become available. A dedicated day trader can get that from various

Nasdaq resellers.

Simply to receive the Level 2 Nasdaq data costs at least $50 per month.

"Already a lot of people are paying that," says Danko, "and

we think the number is in excess of 100,000 to 200,000 people. Daytraders

at any of the daytrading shops are paying the Level 2 fees within

the fees they pay to daytrade." Other markets could be independent

consumers and of course those who work in institutions.

"We are talking to many, many people," says Danko. "The

first of many product applications that we have begun to develop is

in late beta testing. We are right now making decisions as to the

best way to market the product." One possible scenario is to make

it available to consumers through the Internet, and the firm has created

a mechanism using Java applets. "We would charge a monthly fee

to have access to our analytics, and pricing would be very affordable,"

says Danko.

One way Tachyon delivers information is through something that looks

like satellite weather map, called the Tracker Live Map. It changes

— expanding and contracting — with easily accessible Java

technology. You can see the whole cloud (the areas marked red are

where the most change is taking place) or you can zoom in on one area

— one that takes your fancy at that moment or one representing

stocks you have preprogrammed from your portfolio.

Two menus of "Viz-Alerts" will analyze the market for stocks

breaking out from the crowd. Investors could track historical and

intra-day stock movement side by side, zooming in for details, zooming

out for trends.

"One part of our root technology, our dynamic indicator builder,

allows us to build any indicator that you want. It involves some very

fast algorithms," says Danko. Patents are pending, and Danko says

he is sure no one else occupies this space.

"Our goal is to be a cutting edge creator of real time analytics.

We chose the Level 2 area first because no one had been able to do

it, and we thought it would gain notoriety for us quickly."

The potential for combining Nasdaq with another stock exchange? Trading

after hours? "All those things help us," says Danko.

Top Of Page
Keith Danko

Danko was fascinated with the private research that

Migdal was doing — trying to look at ways to analyze the market

and get inside the data as much as possible, and make sense out of

the data. It was enough to spur him to put his own company on a shelf

and throw his oar into Migdal’s boat. "My father was a company

man in the best sense, but that he essentially worked with the same

company for so long may have made me be a little more adventuresome

in my own career," says Danko.

He grew up in New Jersey, where his father was in management at American

Standard, and went to parochial school at St. Paul’s in Princeton,

and then to a prep school, Lawrenceville, where he edited the school

newspaper. At first he was a day student, and when his family moved

to Pittsburgh was a boarder.

At Duke, Class of 1981, he majored in English and economics and was

president of the InterFraternity Council. After two years at Kidder

Peabody in corporate finance he went to Harvard for an MBA and did

a stint as a syndicate manager in London for Goldman Sachs in fixed

income trading. In 1991 he moved back to the states and in 1992 in

Short Hills set up some money management firms, including Minnisink

Capital and Witherspoon Asset Management, and has been managing money

ever since.

He met Migdal (whom he describes as a "very warm hearted gregarious

generous person") through Robert Rice, who is now CEO of MetaCreations

and Metastream. He had been a neighbor of the Rices in Short Hills

before moving his family to Princeton four years ago.

"We would come down and visit Princeton, and my wife Teresa —

who is English — kept saying what a lovely town Princeton is,

and why don’t we live here." The Dankos have three school-age

children and a toddler.

Since Danko left Goldman Sachs, he has had one of his two brothers,

Brett, as a business partner. "We all do whatever it take, every

day," says Danko. "Brett is head of administration, I’m the

CEO, Ward is the chief salesperson, and Sasha is head of the creative

and technology effort. We are working flat out on this."

"I view it as my responsibility as CEO to provide a big enough

platform to fully develop all the ideas that come out of Sasha’s brain

and the brains of our technology team. That is my biggest concern,"

says Danko. "I don’t want to be in the position as the CEO —

and the person in charge of practical matters — of saying to Sasha

or any of the other developers, `No, we can’t develop that because

we are too busy, or we have to put all our attention and money on

this other thing.’"

"I believe in the great technology coming out of someone’s garage,"

says Danko, "that two or three or four smart people who believe

in something and want to develop it and take it to its completion

can do that better than 40 or 50 people focusing on the same thing.

We are here with 13 people. Sasha works all the time — he will

call you at midnight. He is not like the rest of us; his brain is

always working somewhere."

"I do like new challenges," says Danko, who just turned 41.

"I do like managing money and do like picking stocks, trying to

find something that somebody didn’t find, and then making a bet on

it."

He studied Russian for five years at Lawrenceville and Duke. "It

is wholly possible that I had an existing ability to understand people

from Russia that may have helped in developing our friendship. We

have been bringing talent over from Russia, and my Russian is very

rusty, but occasionally I throw in a word."

"Sasha is `out there’ which is where he should be," says Danko,

explaining why the disparate personalities are so useful. "I’m

good at taking exceptional ideas that he has come up with and helping

him find practical applications. That is where the chemistry works."

"He’s a guy who is very passionate about planting his ideas like

seeds and seeing them grow," says Danko. "One seed has now

grown into Metastream.com, and now he has a rush of ideas about the

stock market, looking for ways to trade in the market.

Top Of Page
Russian vs American Science

Studying science is different in America, Migdal says, because teachers

are expected to intrigue their students. "In Russia, the professor

was feeding us. We were hungry. We were tearing off pieces of food

from his hands. We were very rigorously trained. In Princeton, when

I started my first lecture, a graduate course, I announced there would

be no exams and no grades, but that we would work together. `I invite

you to join me at the blackboard and we will solve problems. I will

teach you to think, not from a book. Thinking makes you suffer but

suffering purifies," I said, half in jest. "At the next lecture

only half of them were there. They did not want to suffer. But there

is no way to accomplish something without suffering."

When pressed, he admits he thinks there are national characteristics

of the research communities: "The Russian style is to pay attention

to the underlying correctness of the theory, and if it works. The

American style is usually making things work in conjunction with other

parts." He insists on making clear that he believes talented people

in either country are above these distinctions.

In summary: "Russians care about things being correct and Americans

care about things working. The great scientists combine both. I have

a lot of respect for my colleagues in Princeton who do both."

Migdal was 41 when he came to the United States, and

he is 54 now. "My brain is not any better," he says, "but

I know how to use my brain better. Now I am more productive because

I am not wasting my mental energy on abstract problems with no consequences

and on people who don’t deserve it."

He misses his homeland but, "when I want to see somebody I invite

them. Many are already in the United States. I am not homesick for

people but maybe for a particular type of female beauty. Maybe it

is my imagination, but when I was walking the streets of Moscow there

were so many girls that I liked — some kinds of faces that are

very nice to see around. That, and language is another thing I am

homesick for. I cannot express some subtleties in English which I

can express in Russian."

His talent? "My ability to focus on something and get it done

regardless. Whether applied to science or scuba diving, you focus

on your goal."

His methods? Continual cogitating. "I don’t switch my brain off.

You can work while you are talking, taking a shower, or sitting on

the computer. When I am working on some problem I sleep maybe four

or five hours a day."

His advice for today is obvious, he says. Concentrate on communications

and the Internet. "It is a unique moment. Ten years from now I

would expect the basic problems of the Internet would be solved. Now,

there is an exponentially expanding market, and one can find one’s

own niche very easily. I would doubt it will continue 10 years from

now."

"I don’t want to do what everybody else is doing, I want to do

what I think is important. Physics became boring and routine and not

as exciting as it used to be in the ’70s," Migdal says. "It

stuck in my mind there is nothing more important than the Internet."

1810, New York NY, 10018. Robert Rice, president. 646-485-9100; fax,

646-485-9101. Home page: www.metastream.com.

08540. Keith Danko, CEO. 609-921-2216. Www.tachyonsystems.com.

Corrections or additions?

— the web site for U.S. 1 Newspaper in Princeton, New Jersey.