A decade after successfully weathering the financial crisis of 2008, Goldman Sachs chief executive and chairman Lloyd Blankfein decided to retire. His long-standing deputy, Gary Cohn, had departed at the beginning of 2017 to head the National Economic Council in the Trump administration, so Blankfein had a tough choice to make over the succession.
Euromoney agreed to serve as an informal recruitment consultant while Blankfein weighed his options.
The two obvious candidates had already been appointed co-presidents. The veteran investment banker, David Solomon, was the smoother of the rivals. He came from a relatively privileged background and mixed easily with clients, often offering to host parties as DJ D-Sol or join yoga sessions, like a much younger man who didn’t work on Wall Street.
Harvey Schwartz was a former bouncer from New Jersey whose habit of sharpening knives on the Goldman trading floor unnerved some colleagues, although his record as a securities revenue generator was formidable.
“I feel that Harvey is maybe a bit too much like Gary and we should go for someone who can at least act like he feels some empathy,” said Blankfein. “David’s dance track ‘Don’t stop til you sell enough’ is a big hit with our younger employees and his entire team follows him on Instagram.”
Euromoney wasn’t convinced.
“I’m not sure you’re thinking this through,” we said. “The bank banned emails 10 years ago after Tom Montag’s ‘shitty CDO deal’ comment went public, but now I’m hearing that a screenshot is circulating of an Instagram post DJ D-Sol made at a party on board Jho Low’s yacht, ‘the 1MDB’.”
Blankfein hummed loudly and covered his ears. “That is in the hands of our lawyers and I feel confident I can retire before it ever proceeds to court,” he said.
“And if not David or Harvey, then who?” he asked.
“What about Marty Chavez?” we replied. “He was living downtown and skateboarding to work years before DJ D-Sol got a baseball cap and started spinning in the Hamptons for hedge funders. Plus, he actually understands new technology.”
It turned out this was something of a sore point. Chavez had ingratiated himself with Blankfein by showing him how to use Twitter, but his evangelism for technology while chief financial officer was having mixed results.
An observation by Chavez on an earnings call that all trading jobs could be automated within a year was welcomed by stock analysts but poorly received on the Goldman dealing floors, for example. And Goldman’s shares slumped after Chavez volunteered that wild stock swings and zero earnings visibility would inevitably accompany a rebranding as a tech company.
David, stop – you’re making me regret I ever decided to retire. Well, so long fellows, keep me posted- Lloyd Blankfein
Euromoney hit on a solution to the conundrum. Solomon would take over from Blankfein, ensuring continuity in important areas such as hair styling and plausible deniability.
Chavez would be shifted out of the public eye into a role as securities co-head that allowed him to conduct experiments in trading room automation, while still contributing to Goldman’s master plan to move beyond proprietary dealing and investment banking.
“Just think of the new worlds we can conquer,” Solomon said at his first meeting running the executive committee after Schwartz had been escorted to the exit at 200 West Street and past the cloaking technology that kept Goldman’s New York HQ disguised from the prying eyes of political agitators and regulators alike.
“We can move into deposit taking, small business loans – who knows, maybe even credit card processing,” Solomon said, with his eyes shining.
Blankfein looked up from his phone with a quizzical smile. “David, stop – you’re making me regret I ever decided to retire. Well, so long fellows, keep me posted!” he said.
Euromoney thought its brief foray into headhunting was over after handling the Goldman succession, but news of the smooth transition led to requests from other bank boards.
Keeping it simple
The criteria were different at each house. Santander wanted a highly strung Italian investment banker with some spoken Spanish, impeccable sartorial taste and no strings attached, which seemed challenging.
JPMorgan wanted a banker who could plausibly replace Jamie Dimon without ever drawing publicity as a potential successor to Jamie Dimon.
Wells Fargo just wanted someone without a criminal record.
Euromoney realized that the answer was simple: AI could be used to create the perfect match for each bank. Within no time our app, ‘Bnkr’, was up and running.
If the day ever arrived when magazine print revenues went into decline, at least we would be ready for the digital future.