Morning Coffee: Goldman Sachs gives its "incredibly charismatic" woman a promotion. A pay premium for bankers who can stand monotony
If you had to guess, which would you say was the more senior and important role? “Global Head of Investment Banking Services” or “Global Head of Technology, Media and Telecommunications Group”? It’s not wholly obvious to people unfamiliar with the heraldry of banker titles, but the trick is to realise that the additional word “Services” significantly modifies “Global Head of Investment Banking” and that TMT is one of the biggest and most important franchises at Goldman Sachs. Anyway, Kim Posnett was the first, and is now the second, and it’s clear from the coverage that this is a promotion.
Ms Posnett's profile gives a picture of someone who’s not just a Goldman lifer, but specifically a whole career employee of the TMT investment banking team. She joined as an analyst in 2005, made MD by 2012 and was Global Head of Internet investment banking three years later. Apart from the Investment Banking Services role (and a brief acting career, appearing in two films between university and business school when she was momentarily pursuing a career in entertainment), all her jobs have been in this specific group.
That’s quite unusual at Goldman, where high-flyers are typically encouraged to move around the bank to get experience in a variety of roles. Ms Posnett might be the exception that proves the rule, though; although she seems to have stayed close to the tech and media industry and has a collection of tombstones including the Twitter and WWE deals, she’s by no means a pure dealmaker. As well as a collection of directly revenue-generating titles, she’s been COO of the TMT group and Co-head of One Goldman Sachs.
What do these mean? Another venture into title decryption is necessary. Within every investment banking group, there is a need for someone who has a handle on all the actual business information; who’s doing what, how many people are working there, what computer systems they use and need and what it all costs. Staying on top of all of this information and making business decisions is the COO role; it’s not always glamorous, but it’s important.
And in order to understand the “One Goldman Sachs” role, we have to go back to ancient history and the “Whitehead Memo” which effectively created the “Investment Banking Services” job title. The word “services” there, in context, referred to the innovation at Goldman, in 1956, of having a separate team responsible for marketing and selling investment banking services, separate from the teams responsible for delivering them. Before it was changed, Kim’s official bio said that she was responsible for "helping drive the firm’s client coverage strategy” and “the initiative to deliver a more comprehensive and integrated approach”.
In other words, these jobs have been all about getting people to communicate, coordinate their activities and work for the good of the firm – which can be like herding cats, if the cats had massive egos and multimillion dollar bonuses. It seems that Kim Posnett is good at it, and has been described by fans like former investment banking head Greg Lemkau as “incredibly charismatic”. Goldman Sachs' CEO David Solomon is also a supporter. The fact that she’s now been encouraged to point her star quality back in the direction of clients may suggest that Goldman now wants to fill the internal organisational role with a more straightforward cost cutter.
Elsewhere, it seems that the hottest market for investment bankers is now, literally, the hottest market. It’s Saudi Arabia, where temperatures reached over 50 degrees centigrade (122 Fahrenheit) last summer, but where a big program of economic reform has left both the Public Investment Fund and many big international banks scrambling to staff up. In a very limited local talent pool, that means paying up enough to convince expats to make the move.
If you go there, you are going to need to find your pleasures mainly in the joy of hard work. Alcohol, homosexuality and “extramarital relations” are all illegal, and even allowing for this, there isn’t much nightlife. But pay is between 10% and 20% better than London at comparable ranks, taxes are much lower, there are plenty of perks and, most importantly, headhunters suggest that people can often grab a more senior title than their years of experience would indicate in larger financial centres. If this sounds attractive, it’s worth knowing that a lot of expats working in Riyadh are HSBC alumni; if you have any connections there, you might want to reach out.
It might seem like a bit of a comedown when compared to all the things that people were predicting for Christian Meissner when he first moved to Credit Suisse, but his new role as an advisor on family business mandates at BDT & MSD Partners is almost certainly a better place to be in than most other bankers who moved there in the last few years. (Financial News)
As well as Kim Posnett’s promotion, Troy Broderick has added a new title; as well as head of the global M&A capital markets business, he’s going to be COO of global M&A. (Reuters)
Bankers over the age of about 45 will be overcome with nostalgia; bankers under the age of about 35 will presumably just be confused. There’s a new docu-drama movie coming about about the rise and fall of the Blackberry mobile phone, which was once the ultimate status symbol. (ScreenRant)
The Bank of England is putting out to tender a £280k contract for someone to help it recruit experienced bankers who are on a “career break” (seemingly a euphemism for “old and unemployed”) to come and work in regulation. (Financial News)
If you like searing heat, like the idea of working in a politically conservative hydrocarbon economy, but just can’t quite get to terms with the lifestyle in Saudi Arabia, why not take a look at the burgeoning opportunities at Goldman, JPM and Jefferies to work in Dallas? (Bloomberg)
American universities are apparently absolutely committed to marketing as much branded swag as they possibly can to students and their proud relatives. It makes the limited edition Deutsche Bank sneakers look not only classy, but also exclusive and relatively a bargain. (WSJ)
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