Morning Coffee: Nightmare for the 30 year-old private equity banker working 100 hour weeks. Goldman is on a hiring spree, but only for engineers
Sometimes it’s the little details that stand out from big stories. The Financial Times' writeup of the latest stages of the feud between Apollo Global Management and its former employee Imran Siddiqui is interesting enough. But in covering the interminable lawsuits over non-compete agreements and who made use of what information when, it also casts some light on what your working life is like when you're a star private equity professional, aged 30.
On paper, Ming Dang looks like your average up-and-coming buy-side guy. After Cornell University he joined Morgan Stanley. After the requisite two years as an investment banking analyst, he moved into private equity. First with something called MidCap Financial and then with Apollo.
In person, Dang seems to have been about as committed to your job as it's possible to be. He was reportedly one of the best regarded 30 year-olds in the giant private equity firm, and was working 100 hour weeks and giving his bosses his personal mobile number so that they could get in touch with him if needed during the 68 hours remaining.
If this all sounds like very hard work of the kind that most people don't sign-up for when they leave banking for private equity, it surely is. If you’re thirty years old and you’re still spending a hundred hours a week doing Excel models, having your weekends spoiled by calls, then why did you leave banking?
This isn't all though. As well as his 'standard' work Dang was working off the book and doing favours for Mr Siddiqui in building Excel models for Siddiqui's new project which turned out to compete with Apollo. This clearly wasn't permitted and Dang was subsequently fined $1m for his pains. An arbitrator later concluded that Mr Dang had “lost his moral compass” but given his huge workload, he might consider himself lucky that was all he lost.
It's not clear where Dang is now - his LinkedIn profile says he's still at Apollo, which clearly isn't the case. Taken in combination, though, his experience suggests leaving banking for a private equity career may not be all that. Banks now have controls on working hours, which are supposed to curtail 100 hour weeks. And even in the harshest of IBD teams, you’re not very likely to be asked to crunch numbers on the private project of an MD who doesn’t even work there any more...
Elsewhere, Bloomberg reports that Goldman Sachs wants at least a hundred new workers in its sales & trading operation. Good news for traders! - Actually, no. This particular hiring exercise is entirely concentrated on developers and is being led by Adam Korn, the “co-head of engineering” for GS trading.
Goldman's new hiring spree doesn’t necessarily appear to be a case of “quants eating human trader jobs” as many of the roles don’t appear to be directly “front office” in the sense of facing clients or taking risk. But this might just underline the fact that, as Marty Chavez says, the front/back office distinction is an old-fashioned way of thinking about things. Mr Korn’s business plan seems to require the staff to accelerate the build out of Marquee, the “platform” which has repeatedly been cited as one of the key strategic priorities for Goldman over the next year or so.
This might be seen as another raise of the stakes in the trading platform wars. Marquee isn’t the only platform offering on the market, or even necessarily the most sophisticated - Barx from Barclays is another potentially game-changing competitor. But we haven’t seen any evidence of other platform projects hiring on this scale, or any other firms hiring a hundred non-tech employees.
It looks like the 2020 labor market is going to continue the trend of only favourable for coders and compliance officers. And ironically, compliance is turning out to be the only job that robots can’t learn.
Middle managers are the bane of many front-office staff’s life, and now their expense is coming into focus. As one bank’s head of research said, “It was evident that there were a lot of people in senior ranks getting by with editing notes and managing people. They were the first to go. [as a result of MiFID cost cutting”. Of course, it could be argued that a single editing mistake or major personnel crisis can wipe out the savings of several years, but for the time being, there may not be many analysts who would disagree. (Financial News)
Not official, but now reported in two places – Deutsche has imposed a sort of “soft freeze” requiring C-suite approval for any new hires. This seems partly motivated by a desire to switch employees internally, lightening the load of compulsory redundancies (Reuters : Bloomberg)
And the group of Deutsche veterans in senior posts at Softbank seems set to grow by one as former head of fixed income trading John Pipillis is in talks. (Bloomberg)
Is it going to be just a short hop across Paradeplatz? Former Credit Suisse wealth management rainmaker Iqbal Khan is interviewing for an “undisclosed senior role” at UBS. (Finews)
A “formidable operator” is the kind of thing people say about you if, like Dina Powell, you’re able to pick up Goldman’s pitch for the Aramco IPO and get the firm back into contention after having been left out of the syndicate in 2017. (FT)
Researchers from the University of Manchester find that stocks picked by hedge funds during periods of accelerated outflows tend to outperform; there’s something about redemption pressure that concentrates the mind (Bloomberg)
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