Morning Coffee: 36-year-old ex-Goldman Sachs analysts happily earning $10m+. Tears of Sam Bankman-Fried's father
If you want to put yourself in the way of tens of millions of dollars of earnings by the time you're in your mid-30s, there are a few things that will probably help you along the way. Studying at Harvard, for example. Sharing a room with Joshua Kushner the billionaire venture capitalist and brother of Jared Kushner. Working on the Harvard school newspaper with Alex Blankfein, son of the former CEO of Goldman Sachs. But most of all, you need a short spell at Goldman Sachs, followed by a private equity career at Apollo Global.
Goldman Sachs is not an easy place to work; the hours can be long. But Apollo Global can be worse: in 2021, Apollo associates began quitting en masse amidst complaints of 20-hour days and jerkish/hungry behavior. Pay was subsequently hiked to $450k to compensate Apollo associates for the inconvenience.
One Apollo insider who nearly left during the grindy associate period is Reed Rayman, a Goldman Sachs analyst for two years in 2008 who went to Harvard and fraternized with Kushner and Blankfein. He stuck with it, and today, aged 36, Business Insider points out that he's an Apollo partner sitting on at least six boards of directors and holding meetings at Nobu. Rayman became partner at 33.
He's not the only Goldman escapee who's thriving. Another Apollo Partner is Aaron Sobel, a former Goldman Sachs and Morgan Stanley leveraged finance banker, who joined Apollo in 2011. Like Rayman, Sobel sits on multiple boards. Like Rayman, he's young. "I only realized as we created some of our official documents that he's 36 years old," chuckles the CEO of one company he works with.
Managing directors at Goldman Sachs earn $400k salaries, plus multiples of that as bonuses. But partners at Apollo can earn tens of millions (11 UK partners took him $11m each in 2021). If you can share a room with the right sorts of people at Harvard and survive 80-hour weeks at Goldman and 20-hour days as an associate at Apollo, you could end up in a very good place. BI suggests Apollo may even be more gentle on juniors than it used to be - these days there's a proper HR function and a meditation room. People like Rayman and Sobel are said to be changing the Apollo culture.
Separately, it can't be easy being the father of Sam Bankman-Fried. One moment your son is a billionaire counter-cultural hero feted for sleeping a few hours a night on beanbags and giving his money away, the next he's accused of being a fraudulent sociopathic hedonist and is despised by everyone.
In (another) long profile of SBF and his set-up in the Bahamas, the Wall Street Journal comes across the owner of an upscale French bistro popular with FTX employees before they mostly fled for the US. Bankman-Fried's father, the Stanford tax-law scholar Joseph Bankman, was a regular visitor when he came to see his son in the good times. However, when Bankman visited last week, the bistro owner said it was very different: after a few pleasantries, SBF's father broke down in tears.
Meanwhile...
It's ok, Man Group is setting up a crypto hedge fund. (Bloomberg)
“Based on our review over the past week, we are pleased to learn that many regulated or licensed subsidiaries of FTX, within and outside of the United States, have solvent balance sheets, responsible management and valuable franchises.” (Financial Times)
Morgan Stanley's software bankers think 2023 will be an epic year for deals. "We’re calling this The Great Consolidation driven by a challenging and volatile macro backdrop, the proliferation of public and private companies ripe for consolidation, the emergence of private equity and activists in agitating for M&A, and the need for growth and total addressable market expansion by mid- to large-cap strategics." (Bloomberg)
Former Deutsche Bank trader Matthew Connolly is suing the bank for $150m after his conviction for the alleged rigging of LIBOR was overturned by a US appeals court. (Financial Times)
Deutsche Bank CEO Christian Sewing says European banks are being unfairly punished by regulators and that this needs to change. (Financial News)
Coinbase CEO Brian Armstrong spent a year in Argentina in 2009 and “felt the pain” of hyperinflation “first hand." (Financial Times)
Former Morgan Stanley CEO John Mack had a big chip on his shoulder about not being as middle class as his colleagues and took pleasure in beasting “frat-house charm balls who needed a motivated kick in the ass”. (Financial Times)
People in the UK think bankers are least deserving of their money. (Financial Times)
There are people at Meta who had no jobs to do. One engineer joined to work on a discontinued Blockchain project and has been floating ever since. (Wired)
If the room you’re sitting in here is as cold as 10 degrees centigrade, the blood flow to your brain drops by 20%. (BBC)
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