THE FRANCHISE: Why Goldman Sachs is in a league of its own
Which is the real Goldman Sachs? Euromoney October 1993
Indeed, the finger-wagging that Goldman is two firms in one – a public face that clients see, and an internal profit-at-all-costs machine – was in full flow almost exactly 15 years ago, when Euromoney published a cover story entitled "Which is the real Goldman Sachs?"
Euromoney’s editorial leader, reacting to criticism by some senior rivals in the industry that Goldman had overstepped the mark in its aggressiveness with other firms, wrote: "It is not unusual that successful investment banks find themselves criticized by competitors...It is no doubt partly due to the rapidity and extent of the firm’s achievements. Goldman’s pushiness and arrogance in the pursuit of profits are clearly a factor in its success. The firm has many things in its favour. Clients are on the whole pleased with its services. Its culture and cohesiveness as a firm are outstanding. But it needs to show a little more humility and humanity if it is to maintain its reputation."
Fast forward 15 years and rivals admire Goldman but claim the bank remains two firms in one – a client franchise married to a hedge fund-cum-private equity shop. Goldman chiefs are somewhat immune to the jibes. They respond to suggestions relayed from competitors that Goldman’s results are attributable to a cabal of hugely successful traders with tongue-in-cheek putdowns such as: "I wish it were true, but there just aren’t that many George Soros’s in the world, let alone at Goldman Sachs."
One thing remains the same – Goldman Sachs still wins more key client business in the areas that matter – big-ticket equity and M&A deals – than any other firm.
And as for the humility? Speak to Lloyd ‘There but for the grace of God’ Blankfein.
Subscribers can download a PDF of our October 1993 cover story, "Which is the real Goldman Sachs", online at euromoney.com