Morning Coffee: Why Goldman Sachs' big new hire knows little about finance. The worst ever LinkedIn endorsement

Goldman Sachs made some important new recruits yesterday. Replacing departing co-CIO Elisha Wiesel, the firm went outside the financial sector to bring in Marco Argenti who had previously been vice-president of technology (remember, “vice president” is a more meaningful term outside the banking industry) at Amazon Web Services, the cloud computing giants.  It also hired a Chief Technology Officer, Atte Lahiranta, from Verizon Media Group.

Both of these new hires are coming into Goldman as partners – given the C-Suite titles, it could hardly have been otherwise, but it’s significant in a year when the partnership promotion class was noticeably small and when the partnership is said to be shrinking.  Neither Argenti nor Lahirinta appear to know much about finance, but they clearly have skillsets that Goldman wants.

Lahirinta spent his time at Verizon working on cybersecurity, big data and other areas that look directly applicable to Goldman’s needs.  Argenti, on the other hand, has spent the last five years “overseeing all aspects of the product lifecycle of Cloud Services”.  - This is a cloud computing guy. And banks are very interested in the potential of the cloud. 

While demand for traditional finance skills falters, cloud computing experts like Argenti can name their price - irrespective of finance knowledge. If Argenti hadn't joined Goldman as a partner in New York, he could probably have stayed in Seattle and got a job at JP Morgan’s cloud hub.  Deutsche Bank’s Neal Pawar is known to be a strong cloud computing advocate from his time at AQR. 

The big question now for banks seems to be whether they want to build their own cloud, as JPM is doing, or to become unusually big customers for one of the big three providers – Goldman is currently an AWS customer, UBS is moving to Microsoft while Google has HSBC and has been ramping up hiring in London to expand its financials offering.

The CIO role is fundamentally a managerial one, and that’s where Argenti’s experience seems particularly relevant; a recurring theme in his career at AWS and previously at Nokia was responsibility for “Developer Experience” – in other words, managing the relationship between the coders and the programming interfaces they have to work with.  It seems likely that these shifts at the top are going to foreshadow a changing of the technological generations lower down the structure, and that cloud computing is going to go from a hot hiring sector to a box that everyone needs to tick, sooner rather than later. When he's not propagating the cloud, Argenti may be able entertain Goldmanites with some strumming- he is also lead guitarist of Seattle band Element47.

Elsewhere, it’s been suggested for a while that LinkedIn is basically Twitter with a suit and tie, and the network for professionals sometimes has drama that would put other social networks to shame.  Not only do you get viral rejections, it’s also a network on which couples going through relationship problems can put (unconfirmed and amazingly defamatory, so not reproduced here) accusations about their senior banking partners in the form of a spoof “Thank you” card.  

This is what happened to one unfortunate senior banker this week after his wife gave him a LinkedIn endorsement that wasn't, and promptly deleted it. Various people seemed to spot it though - by Thursday his profile on Bloomberg had been viewed 7,000 times. 

Meanwhile…

Goldman Sachs published its annual 'fall reading list' (presumably made up of things the bankers read over the summer). There are quite a few business books and mixture of middlebrow history and pop psychology that suggests “bought in an airport”.  The New York Times’ David Brooks appears twice, with different books about the development of moral character.  Zheng Li, head of the Equity Solutions Group in Hong Kong chose, “Remains of the Day” by Kazuo Ishiguro.  A story of someone who abandons their hopes of happiness in pursuit of an ideal of service in a world where their role is slowly becoming obsolete… (Business Insider)

Dane Holmes, the Head of Human Capital Management at Goldman Sachs, is to retire at the end of the year, after launching the “Day In The Life” recruitment branding campaign yesterday and recommending “The Road To Character” by David Brooks to read this fall (Reuters)

Why are so many of the world’s ESG and impact investing funds managed by women?  An investigation into one of the few areas of finance where the conferences have a queue for the ladies’ lavatories. (Finews)

Hideyuki Sugita of Goldman Sachs Asset Management broke his neck while playing rugby; the extraordinary story of his recovery from paralysis to climb Japan’s highest mountain. (Japan Times)

BNP Paribas has launched a new “digital assistant” to help traders communicate with its algorithmic FX trading system and get feedback in real time.  At present, communication is by short text messages but it could be possible that the second generation will interact by voice commands, like Siri or Alexa.  This would apparently require “compliance and safety checks”, however; given the way that forex traders talk, this could be something of an understatement (Financial News)

Two JP Morgan traders have been put on leave as the criminal investigation into “spoofing” on the metals desk continues (Reuters)

The Q3 warnings continue, with Morgan Stanley suggesting equities revenue is down due to “uncertainty about what’s going to happen next”, although credit trading remains good (FT)

Banks have been accused of “Brexit fatigue” by their regulators (probably not unjustly) and told not to slow down on their preparations (Bloomberg)

Photo by Dallas Reedy on Unsplash

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