Morning Coffee: Goldman Sachs’ top earner says his career was entirely unplanned. The world’s best compulsory compliance training videos
Julian Salisbury, the Chief Investment Officer of Goldman Sachs’ Asset & Wealth Management division, is a kind of hero to ambitious middle office people. Having initially wanted to be a professional kayaker, he got sick of sleeping in a van and so became an accountant, then got a job after qualification doing risk reporting and P&L for a credit trading desk at Goldman … yadda yadda yadda, and now he’s a partner.
Initially, at least, none of this was intentional. Salisbury says there was no plan - he just went with the "most reasonable option" and stumbled into things. In interviews (like the one he recently gave with the Big Picture podcast) he tends to bring out a collection of illustrative anecdotes – the sleeping-in-a-van one, the having-to-learn-financial jargon one and the matching-up-paper-slips one (he attracted notice on the credit desk for automating this task, reducing it from a day’s work to thirty minutes). But sometimes he does seem to address the question that all his fans want to know the answer to – what do you really have to do if you want to end up in charge of some of the most prestigious and highly paid teams at Goldman, having started doing a non-target degree (sports science) at a non-target university (Loughborough, in the UK)? Is it possible at all these days?
Salsibury makes the case that it could happen – he says that as well as “a pretty tried and tested campus approach”, Goldman has “opened up the funnel materially over the last decade or two to try … to attract not just the obvious kid who did the finance degree at the obvious finance focused school, but to attract a broader range of talent”. He also notes that “a little over 50% of people at the firm” have joined in the last three or four years.
However serendipitous your route into Goldman, once you arrive, it’s important to master the basics. Julian Salisbury had to take a course in bond math to understand what people were saying, and one of his top tips is to regard strange industry jargon as a challenge to master, rather than something to be put off by. On the other hand, he values practical knowledge, recommending that everyone needs an area of specialism, and that “we get a lot of kids who come through the business who have fancy MBAs but they don’t truly understand the interactions between a P&L, a balance sheet, and a cash flow statement”.
But at some point, unless you want to do one thing for the rest of your life, you need to move on from the comfort zone and take on new responsibilities – Salisbury claims that he’s worked in “all but one division” of Goldman, and in three different offices in two continents. He suggests that after three or four years, things stop being difficult, and you “develop reps”, at which it’s time to “start changing the exercise or increasing the weights”. It seems that a degree in sports science can be relevant to a career in banking after all.
Elsewhere, the most reviled form of filmed entertainment in the world – more so than basic cable sitcoms, worse than scripted reality drama – is the corporate compliance video. What other programming is there which can only get an audience by locking people out of their PCs until they have watched it?
It doesn’t have to be like this, though. “Trust Code”, a cliffhanging drama in which Devin Badoo plays Nelson, an unethical coder who is always nearly getting fired from Microsoft, is on its seventh season, and appears to have actual fans. Microsoft employees are holding watch parties for it, buy “Trust Code” swag, and take selfies with its star when they see him at his day job.
Surely the investment banking industry should do this? It’s an inherently more interesting industry with compliance questions which lend themselves to the Netflix treatment – arguably, “Industry” is already a compliance training video, albeit one in which all the quiz answers are wrong. Or you could take the crew from “Goldman at 150” and get them to make “The Credit Suisse Story”. Don’t call it “trading while in possession of material non-public information”, call it “spoilers”.
A somewhat more wholesome banking movie might be the feelgood buddy story of King Street Capital. Although lots of people on the Street just keep score with dollars and cents, there’s a lot to be said for the view that you’ve really won in this game if you reach the “Lifetime Achievement” stage of your career and you’re still friends with people you met on your first analyst program, as Brian Higgins and Francis Biondi did at First Boston in 1987. (Institutional Investor)
It's not quite clear what is going on in this article about a 2015 capital raise for ANZ Bank (and it looks like the article has been written quite carefully from a legal perspective), so ignore the story and savour the wonderful Aussie quotes. Bankers were “caught up in the heat of the moment and focusing very much on things that they had to do at the time, and possibly being a bit sleep-deprived”, while underwriting assurances were “It wasn’t like we were talking to a junior dealer saying, ‘Don’t worry mate, she’ll be right’. We spoke to the CEOs”. (AFR)
Can there be a better named business than “Professional Boundaries”? It’s a specialist training consultancy which “does most of its business by mopping up after something has gone badly wrong” with an office romance. (Bloomberg)
“The halcyon days of Miami crypto may be behind us”, says someone with a gift for understatement. The annual NFT conference, along with several others, are still being held in the city, but attendances are sharply down, the FTX Arena is now the Kaseya Center, and everyone seems to be a little bit embarrassed by the crypto bros. (WSJ)
Equity analysts are used to dealing with companies being angry at them for writing Sell notes, but the oil team at Barclays are under attack from a group of environmental nonprofits, who are writing to Venkat claiming that one of their reports is too soft on the ESG impact of a pipeline project. (Bloomberg)
Ties are history, you can get away with sneakers, but you need to have a blazer even if you never wear it. A fashion guide for the perplexed junior banker (Business Insider)
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