WSO Podcast | E124: VP at Goldman in IB Makes it from Trading and Liberal Arts Background
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In this episode, LiberalArtsBanker shares his winding path from a small liberal arts college to VP at Goldman Sachs in investment banking. Learn why he started out in a trading role, why he jumped to a prop shop after a few years, his advice on trying to build a career as a trader as well as why he pivoted to IB with an MBA.
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WSO Podcast (Episode 124) Transcript:
Patrick (CEO of WSO): [00:00:06] Hello and welcome. I'm Patrick Curtis, your host and chief monkey, and this is the Wall Street Oasis podcast. Join me as I talk to some of the community's most successful and inspirational members to gain valuable insight into different career paths and life in general. Let's get to it. In this episode, LiberalArtsBanker shares his winding path from a small, liberal arts college to VP at Goldman Sachs and investment banking. Learn why he started out in a trading role, why he jumped to a prop shop after a few years, his advice on trying to build a career as a trader, as well as why he pivoted to IAB with an MBA. Enjoy. Liberal arts banker, thanks so much for joining the Wall Street Voices podcast.
LiberalArtsBanker: [00:00:55] Hey, thanks for having me.
Patrick (CEO of WSO): [00:00:57] So it'd be great if you could just give the listeners a short summary of your bio.
LiberalArtsBanker: [00:01:00] So I've been doing finance for about 15 years now. I started out of undergrad trading different kinds of derivatives, both in kind of a market making capacity at first and then a proprietary capacity for a couple of years after that phenomenal timing. If you think back about 15 years ago to go into trading right before the start of the global financial crisis and during that time, I, I enjoy trading, but I saw the writing on the wall in terms of where the trading job market was going, which obviously had a couple of tough years there through the late 2000 single digits and into the early 2010s. So decided it was a good time to go back to business school. Got my MBA and a top 20 MBA program, not one of the top three or four, but with a definite eye into going into banking. Banking from my perspective at the time gave such a wider skill set and a transferable skill set and the corporate training to go get many different types of jobs. So everyone agrees. The traders you need to be smart, need be analytical, you need to be have a great attention to detail, you need to be good under pressure. But I don't even know what IBD was at the time. Yeah, and it's hard to convince a corporate finance department or an M&A boutique or anyone to hire you with a trading background if you don't even know the basics of accounting or corporate finance or modeling or stuff like that.
LiberalArtsBanker: [00:02:32] So the idea of going back to business school is a to get into banking and then leverage that skill set that you learn both in business school and then with a couple of years of banking to get onto something that I found more interesting than the day to day transaction activity of banking, which eventually will be hopefully the buy side somewhere in a private markets type role or in corporate development at a firm that's doing a lot of M&A and you're really driving value for one of your clients most of the time. So that's been the goal. I started out of MBA at a, you know, a middle market bank. I called middle tier mostly because that firm was one of the only firms that was consistently hiring through the financial crisis. Mm hmm. You know, lots of European banks were cutting people out of U.S. banks were cutting people or not even having intern, MBA interns or full classes come in. So finding somewhere that was stable was very important and finding somewhere that had a good financial institutions group was very important because I wanted to leverage the kind of four years I had on a trading desk and understanding that whole ecosystem into my banking career so that for years I spent four or five years I spent trading wouldn't completely go to waste because I would go cover financial institutions, clients and I would have an immediate leg up on other associates or other analysts or whoever else in the group who had never worked in the trading or markets ecosystem. So it started, like I said in Middle Market Bank was there for about two years. Quickly realized that the deal flow there. Although I got to learn a lot about different areas of fig covering, especially finance and insurance and asset management, along with capital markets focused fintech, the group did like one lead M&A deal in the two years I was there, and in my opinion, the things that make you valuable as a banker, both as a junior banker and then increasingly as a senior banker lead deal experience. Your connection and network with your clients and other intermediaries, lawyers, accountants, other bankers in the market. And then like your network in terms of are you going to be able to go and eventually be a coverage banker? And who do you know and how well, how comfortable are they with you? And I just didn't see myself getting that level experience at the first bank where I was, so I had an opportunity to lateral. A retained recruiter for a large European bank, found my resume on LinkedIn and said, Hey, do you want to come in and work for one of the premier fintech bankers on the street? And I had actually been on a bunch of deals where this banker had been reading the deal and we were fourth or fifth bank down the list and thought, Listen, if I'm going to stay in banking and my ultimate goal is to get a really good buy side job or a really good job.
LiberalArtsBanker: [00:05:24] I have a much better shot at doing it from this European platform where we're going to get more deal experience more consistent with the bulge bracket experience, not a middle market experience. So it might be painful for a year, like switching is not free, but fine. Let's go do it. Yep. And that really played out. You know, the level the positioning of that bank on deals was far. Beyond where we were at the Middle Market Bank, the pace and intensity of everything picked up and the experience was great. I had an opportunity to be the analyst for a while. I was there for a while, which is another good experience, you know, kind of see the inner workings of a group. Everyone's always mad at you, you know? Yeah, people are mad at you because they don't feel like they're getting good projects or they're overworked. Senior people are mad at you because they feel like they're getting short, you know, short shift on, yeah, resources or I'm not getting the best people or this took too long. So it's interesting. It was a good experience, but I never want to do it again.
LiberalArtsBanker: [00:06:30] And 18 months was too long. So but again, you get to see how the how the sausage gets made at the group level, how they think about staffing, how they think about staffing versus revenues and stuff like that. Got it. Which is interesting, and it gets you more visibility with the group heads, which is never a bad thing as long as you don't stub your tail or anything. Mm hmm. So you spent three or four years at the European Bank, got promoted to VP, was the staffer for a while, kind of pivoted my focus from spending most of my time in fintech for the first year. So I was there to spending most of my time covering asset management clients. Mainly because there was more headroom on the asset management side of the floor. And I worked really well with the MD on the asset management side and we got along pretty well. So that really kind of increase the trajectory of my career and I could have stayed at that firm and gotten promoted to director and possibly even MD early. And you know, the world was my oyster there, put it that way. But similar to what happened the first time around, a recruiter from my current employer, Goldman, hit me up and said, Hey, we're looking to reform an asset management coverage team. We have a new MD who's going to do this and we need a new, you know, a whole new kind of junior apparatus beneath him.
LiberalArtsBanker: [00:07:52] And we need people with asset management experience. So I came over to Goldman and for the same reasons, really know again upped hiring both the brand up to my experience in terms of leading deals in terms of being a point person in front of clients, whether it's CEOs or people running private equity funds or hedge funds. And given the area I cover asset management, there's so much interconnectivity between the large bulge brackets in the U.S., especially and asset management clients that if you're if you're covering them like it's almost impossible to cover from a middle market perspective because, you know, every everybody who runs a private equity firm or hedge fund. Seventy five percent of them are alums of Goldman or JP Morgan or somewhere like that, or they have affinity for the firm for one reason or another or their big clients of the firm in the securities division or whatever. So that's how you kind of get your hooks into everybody and make sure that you you're having the right level of dialogue with the different clients across a broad sphere of asset management. So, yeah, it's been about three years at Goldman. As a senior VP, Goldman doesn't have directors, so it's been a good experience and obviously a couple of different stops along the way, but
Patrick (CEO of WSO): [00:09:08] Quite a ride. So let's go all the way back to your liberal arts college. I went to a liberal arts college graduated, probably knowing next to nothing like you obviously didn't know Evita then, but tell me about how in the world did you end up at a
LiberalArtsBanker: [00:09:23] As a trader? Yeah, so it's interesting. I had no idea what I knew I wanted to be in finance, but I had no idea what the different job functions, the different types of firms, the different types of roles that were available to those firms were because resources like Wall Street, Oasis were not really in existence or prevalent back then. You know, things were done.
Patrick (CEO of WSO): [00:09:48] Your senior year we started.
LiberalArtsBanker: [00:09:50] Yeah, so things were done way more word of mouth. And you know, I went to a very highly ranked liberal arts school, but. Finance wasn't one of the big career paths that people generally chose out of high school. People tended to go to grad school more or go to law school or go right into different types of professions, but not finance. There's usually a couple of people a year tops. Right. So it was more networking amongst alumni, networking amongst my personal network and just seeing what the few people I knew who were doing in finance, who are older than me at school to get a little bit of a flavor of what the different roles were. So, you know,
Patrick (CEO of WSO): [00:10:33] Like investment banking was your junior year. Do you know what, like trading was?
LiberalArtsBanker: [00:10:36] And I had like a decent idea, but I definitely didn't know. You know, the high didn't have the big picture, which I feel like you can easily get the big picture reading, reading the forums, reading the guides that are out
Patrick (CEO of WSO): [00:10:48] There now, you can.
LiberalArtsBanker: [00:10:49] Yeah, now you can. But then it just wasn't available. I knew what the analyst or the junior trader role, how it was different. And really, I had two offers. I had a banking offer in the trading offer and the banking offer was you wear suits every day and you work really long hours. And a lot of times you don't have any control over your schedule. And the trading offer was you wear a polo shirt and flip flops and you work market ish hours, you know, plus or minus a couple of hours before the market and after the market or both.
Patrick (CEO of WSO): [00:11:21] Both offers in New York,
LiberalArtsBanker: [00:11:24] Both offers were in the mid-Atlantic. I'll say not
Patrick (CEO of WSO): [00:11:27] Many. Yeah, OK. Sure. So you? You basically had a chance you could have gone banking right out of school, you chose the trading route. Besides the long hours and the suit suits to work, anything else that could push you to the trades?
LiberalArtsBanker: [00:11:40] I was I was an economics major. My favorite part of economics was game theory, and I've always been interested in gambling interesting and playing poker. That was like the poker craze back, like you would
Patrick (CEO of WSO): [00:11:54] Call it no limit player.
LiberalArtsBanker: [00:11:55] Yeah, yeah, yeah. I've been known to throw the chips around a little bit. And that was core to. You know, it's just so similar to trading when you get when you really boil down to it, it's both gambling, how good a poker.
Patrick (CEO of WSO): [00:12:10] Did you study like, I mean, I ended up studying, started studying. I didn't go down to like the professional route, but I was I was
LiberalArtsBanker: [00:12:16] I would play a lot. I was. I was very well studied. That was back when you could play online for money and do what I paid for a lot of things in college with poker money. I actually
Patrick (CEO of WSO): [00:12:28] Think you made like twenty thousand fifty thousand more,
LiberalArtsBanker: [00:12:31] Probably a little
Patrick (CEO of WSO): [00:12:32] Less than 20. That's okay.
LiberalArtsBanker: [00:12:34] But you know, and I also enjoyed it. Obviously, poker got a lot harder after everyone figured out how to play. Oh yeah. Oh yeah. In the years after that. But it was fun while it lasted. But trading poker was so similar right there, both about making decisions in situations of incomplete information and learning tendencies and being comfortable with risk and making probabilistic bets. Even though you're not going to win every time but being comfortable continuing to make those, you know, as you say, I'm going to bet you one hundred dollars on a coin flip, but I'll pay you fifty five dollars every time you're right and I'll take forty five every time you're wrong. You could lose 20 in a row and you still got to take that bet every every single time. And some people can get their heads around that and some people can't.
Patrick (CEO of WSO): [00:13:25] So you never went on tilt is what you're trying to say. That's the that's
LiberalArtsBanker: [00:13:31] That's not true, obviously not true. And it's funny because you think of traders like being like the ultimate like just different engines, like you're just making these probabilistic bets over and over. But they were even worse than professional gamblers, I know. Yeah, I mean, I worked at one trading firm where the guy who ran the firm, like the other partners in the firm, had to close them out because he just kept doubling down on this one bet that kept going against him for like 16 months in a row or something. And it almost got to the point where the firm kind of sank and they had to they had to close them out. But it's hard to imagine somebody betting red in roulette with stay for that long or something like that. Keep doubling their bet until they win.
Patrick (CEO of WSO): [00:14:14] So you kind of choose the trading shop you when you first start. What? What is it like? I mean, obviously, do they have like any sort of training at all? I mean, it's some way. Yeah. So did you feel like you got any sort of knowledge from that training? Or was it basically ninety five percent of the job? And did somebody take you in the first few months? Yeah.
LiberalArtsBanker: [00:14:32] So it started off with a couple of weeks of training and fundamentals. It was their primary asset classes options. So a couple of weeks of options, fundamentals, market fundamentals, they give you a little bit of like, here's how it works on different desks. So you're trading in grad.
Patrick (CEO of WSO): [00:14:54] Uh, no, not really. No. Ok.
LiberalArtsBanker: [00:14:57] And so they gave you, I think it was like five weeks
Patrick (CEO of WSO): [00:15:02] And that was how did you even get this job? I mean, coming from a liberal arts background, you have people was friends or. Yeah.
LiberalArtsBanker: [00:15:09] So they. So this this firm going back always had always recruited. And my college was only about 20 miles from the firm, so they always had recruited regionally. And their big thing has always been that they don't care what your background is. They could care less if you went to college. If you can get through the interviews and answer for all the probability questions and you get to the desk and you do a good job and you get to your. We had competitive mock training sessions every week amongst the junior traders and you'd be fighting and they'd keep track of how much money everyone was up or down. Sometimes we'd play cards and have training. People like me
Patrick (CEO of WSO): [00:15:52] Have the answer about those competitions. What what type of were the options?
LiberalArtsBanker: [00:15:55] Mostly you were just, yeah, options. Yeah. So they would set up an options board, you know, open up some markets with bids and offers for different strikes, and you have to just kind of do math in your head and they say, Hey, I'm going to bid six dollars and fifty cents for these calls. What does that imply and these puts over here or what does that imply and the risk reversal or the call spread? And OK, if I'm getting six fifty for these, you want to sell these other ones at seven bucks, you know, that kind of stuff.
Patrick (CEO of WSO): [00:16:22] And did you so did that take you a while to get up to speed or just because of the oh yeah. Yeah, it still took you a while. Like, when
LiberalArtsBanker: [00:16:29] Did you feel it takes a while to get the. You know, everything in options is you're looking at normal distributions of stock returns and you're looking at different distributions of how things are usually priced across different strikes and different, you know, puts calls and everything in between all the different combinations. So learning all of those took a while to learn all those relationships between the different combinations of different combinations of options, trade and what people are betting on. Like, you know, somebody buying a straddle, it's a lot different than if somebody is trading a call sprint, right? So what are they betting on a call sprint? What are they betting on a straddle? It takes a while to learn all that. But once you kind of get all that down and then you can do the math in your head pretty quickly, it's, you know, it's the same. You once you know all that, then you can get away from trying to just really, really just like, memorize what someone's doing based on the different trades they're doing and really see the board and see like, Oh, someone's bidding up at the money fall or someone's making a calendar bet rolling their vol exposure, or this is just a simple know. This is basically stock trading a combo or trading a tight risk reversal or something like that. So once you get through the fundamentals, which takes months, usually at the short end a month, as long in people sometimes never get it, then you can start to actually see the second level of what's going on in the board and then make your decisions based on that. And that's what you're supposed to do.
Patrick (CEO of WSO): [00:18:00] Any tips on how to speed up that progression for people who can't eventually get it as soon as? Yeah. Yeah, I mean, trading with trading on your own help at all? Or is it better to do it in that training kind of mock framework?
LiberalArtsBanker: [00:18:13] I mean, learn. I would I wouldn't advise anyone to take their money and go jump in to start trading like, you know, the iron butterfly. Two months out and some in Tesla. Yeah, right.
Patrick (CEO of WSO): [00:18:28] So many people shorting Tesla, thinking, being trying to be heroes.
LiberalArtsBanker: [00:18:32] Yeah, exactly. I would say, like there are places and the names of them are escaping me where you can open a paper money account. Yeah, right. And you can learn. Learn the code is Google
Patrick (CEO of WSO): [00:18:45] Paper money or mock?
LiberalArtsBanker: [00:18:47] Yeah. Like open one of those open one that has good options functionality and then learn the Greeks, learn the fundamentals of options and understand all that at a really, really core level, and then just trade some paper money stuff and see, you know, see how it goes and learn what your different risks are, right? Like, like I said, trading somebody say, Oh, you're doing is buying a put in a call. The trading out of the money straddles different than trading or front month at the money straddle versus two months out. And you can do straddle swaps. You can do risk reversals. You can do like big wide box. Like there's all there's a thousand different combinations of different options trades you can do and understanding what your actual risks are and what you're betting on in all of those is important and how you would hedge them.
Patrick (CEO of WSO): [00:19:32] So you are now, you weren't asked any of that in your interview. It's, I assume, coming from.
LiberalArtsBanker: [00:19:35] No, no, no, no. The interview is like they want
Patrick (CEO of WSO): [00:19:39] To know if you're smart.
LiberalArtsBanker: [00:19:40] Yeah, it's poker questions. You know, probabilities. There is like a base theory question. There was an interesting one where there's something that's completely unknowable to me. I think the interviewer asked me, what? I was supposed to figure out how old he was and provide a 95 percent confidence interval for how old he was. Um, by asking the questions that had nothing to do with what you graduated or just stuff where you could really try to back into someone's age. So I asked a bunch of questions like Do you have kids? Did you go to graduate school? You can't ask how old as kids are, but like, what kind of cars do you have? It turns out his wife had a minivan. Does their TV in the minivan? So I figured he had young kids. He went to grad school. I knew he was a senior person, the firm, so I kind of backed into something. So my confidence interval or no, he actually asked for a point, a point. Guess on this one. So I said, OK, I think you're thirty five. And this was like a five seven minute back and forth. Yeah. And then he he's like, OK, well, I'm going to offer you a bet if you're within one year on either side that I'll pay you ten dollars, but for every year you're off. If you don't, if I'm not, thirty four, thirty five or thirty six for every year you're off. You pay me twenty dollars and I thought about it. And it turns I mean, the point of it is both to see how I was trying to get information out of him. Yeah. And then to see if I could understand that he's supposed to be a rational actor. He's not going to offer me that bet unless he knows he's going to make money because he knows how old he is. All right. That was the entire point of the exercise,
Patrick (CEO of WSO): [00:21:20] Which is very sneaky, very sneaky.
LiberalArtsBanker: [00:21:23] But that's what they're looking for. They're looking for people who understand, like, Listen, he knows something I don't know. I'm assuming he's rational. He's not going to do something irrational in terms of something that's going to probabilistically lose him money, right?
Patrick (CEO of WSO): [00:21:36] So if he was thirty nine, he was like, Yeah, let's do this.
LiberalArtsBanker: [00:21:38] Exactly. It turned out he was like thirty two and I would have lost money and I actually taken the bet. Yeah.
Patrick (CEO of WSO): [00:21:43] Got it. So, OK, so you're at the first shop kind of more as a float trader, you mentioned, but then you kind of ended up jumping to a place that was more prop. Yeah. Yes. So tell me about that transition, why you made that transition and what the thought process was and then what it was like day to day the differences between the two? Yeah.
LiberalArtsBanker: [00:22:00] So I mean, really, it was a market making firm the first place. So I was an assistant on one of the larger desks there. And my job from the beginning was to book trades, make sure our risk and P&L were updated, you know, reconcile trades at the end of the day, reconcile everything again in the morning and really just execute trades when they came in, meaning posting them to the exchange, posting them with our brokers on the floor on the options exchange just
Patrick (CEO of WSO): [00:22:31] After six months a year, you're pretty bored because you know you're in. You're like, Yeah, you're in your pattern of just execution.
LiberalArtsBanker: [00:22:38] Yeah, exactly. And it's hectic, and some of the senior people can be difficult. And there's like no upside because you're never going to do anything great where you're going to make anybody any money. Yeah, but you can definitely screw things up where you're at it cost people a lot of money and that that happened, you know, I had a couple of small ones, other people had a couple of large ones, and it's stressful. But as things went on past that first six months, you know, it became interesting. I got to execute more of my own trades. I got to make my own markets on smaller stuff and actually got some decision making capacity, and I really like that. But it's still a market making right. You're still judged on an overall portfolio, which I was a very small contributor to five percent of the trades of our whole book or whatever, right? Because right now, the head trader on my desk wasn't going to have me make a decision on anything important that was going to really move the P&L, obviously.
Patrick (CEO of WSO): [00:23:30] So like when you were when you were making markets was you said it was a small kind of sub market like where you would be setting the price you'd be setting the spreads for.
LiberalArtsBanker: [00:23:38] Yeah, yeah. So we had automated quotes and we had people on the floor doing their own quotes. So I would make sure that our clients are working right and everything. But if our, let's say, one of our sales traders called us and said, Hey, hedge fund XYZ wants to do three hundred of these options, right? And they had traders busy because he's trying to trade a thousand lot somewhere else, right? Right. And and it's a it's a pretty liquid position. He only needs to do three hundred. I'm like, OK, fine, I'll put that up for him and I'll pick something around the current screen bid offer and then I'll hedge it a little bit with the underlying shares after we execute the trade. But that's the kind of stuff where again, you can screw it up and really costs yourself money, but you're not going to make a career off of doing that, like on a trading desk.
Patrick (CEO of WSO): [00:24:22] Got it. So that's helpful just to hear that like example. That's that's they give solicitors kind of a viewpoint in.
LiberalArtsBanker: [00:24:29] Yeah. So on the prep side, it was a slightly different asset class. This firm had a long track record of having 50 plus traders who the firm as a whole was making money every week for like seven or eight years. So they had they really had some alpha on the trading side, which you know, is hard to find. So I like that aspect of it and the aspect of like I was going into a small. The firm was based elsewhere. I was going to be working right outside of New York City in a satellite office, and it was a small group of traders, very informal. Everybody's got their own book and you know, they say, here's your money and. They give you some guidance from a senior trader like mentor who you kind of before, you
Patrick (CEO of WSO): [00:25:09] Know, it seems like you took some time off in between. It was this because you just like I had a
LiberalArtsBanker: [00:25:14] I had a severance
Patrick (CEO of WSO): [00:25:15] Agreement, severance, so you had to wait for a little while. Ok. So can you tell me when you started there? Do they start you off with like a small book? Do you mind telling me what it is like? Yeah.
LiberalArtsBanker: [00:25:25] So they had one specific trade. Yeah, so we traded something that was very highly leverageable on the fixed income side. So not on the options side, but this was more fixed income and rates. Yeah. So you can get not infinite leverage, but a lot of leverage. So actually, it didn't need a lot of capital to do a significant amount of trading, especially if you plan on trying to go home every night flat so you weren't carrying small. Even small positions could be expensive overnight.
Patrick (CEO of WSO): [00:25:56] So it was entered or as daily kind of flow, not flow trading. How do you call? What do you call that quick high frequency trading, but not like? I mean, I see high frequency like, no, no, not yeah.
LiberalArtsBanker: [00:26:08] It wasn't super high frequency. I'd say our average hold period was like an hour and a half. Ok, got it right. We would see it would be kind of hedged in terms of the market goes up, market goes down. We think we're hedge to that. But we were trading little variations and trading in pairs, mostly. So it was a little bit of pair's trading across the universe and. You know, we were trying to just find those little discrepancies where one instrument has gone up, but the others haven't caught up, so we'll sell the one that's gone up and buy the other ones and hopefully that corrects.
Patrick (CEO of WSO): [00:26:42] So a lot of data scientists and stuff like that or how did you?
LiberalArtsBanker: [00:26:45] Definitely. A lot of the firms started with a couple of very quantitative PhD type people. They're running analysis for us and making sure our risk models are up to date and trying to find new pairs for us to trade, they thought would work out, but it was still pure clicking.
Patrick (CEO of WSO): [00:27:02] But then how do you think they're so successful? So for so long then doing that and I mean, was it just because they were they were in a small enough market where they could kind of get a little?
LiberalArtsBanker: [00:27:11] Well, it was a very large market, but it was bifurcated amongst a bunch of different trading platforms. And the guy who started the firm created the first technology solution to kind of aggregate trading and risk across these different platforms, where you had to trade different instruments on aisle just as Treasury Treasury bonds and futures, right? So you used to trade Treasury bonds on speed and broker tech, which were broker owned systems. The Treasury futures used to trade on the CBO, which is bought by CME. So kind of.
Patrick (CEO of WSO): [00:27:48] He was able to somehow attach some sort of system. Yeah, getting
LiberalArtsBanker: [00:27:52] Get it together or you could trade all those at once and trade as one trade saying like, Hey, I want to buy the five year bond and sell the five year futures. And that's one trade that's going to execute at the same time across four different markets. Maybe. That was a pretty big deal. That's a big deal. Yeah, pretty impactful solution at the time. Very cool. Got it. But there's a second half to this story.
Patrick (CEO of WSO): [00:28:12] Yeah. So what happened? Why not stay there and ride off into the sunset with your million?
LiberalArtsBanker: [00:28:16] That's, believe me, a lot. A lot of people did who had been there for years before that. But yeah, what happened was people saw firms like this one making a lot of money on this trade and they had better technology. And I know for a fact that a couple high frequency Chicago based firms came into our trade and just eat the firm's lunch. So I was with the same small group of traders. We left the original firm. We started our own thing for a little bit and then our own thing kind of not blew up. It just didn't take off the way we wanted to. And the two guys who put up most of the money had a life change and they needed to get some of their money out. So we ended up joining a larger Chicago trading firm again. So this little group of five guys kind of went from this original firm to our own thing to another larger firm. But by that time I had the writing was on the wall that this wasn't going to work out the way I kind of wanted it to at the time, and I could have gotten other trading jobs, but I just didn't like where it was leading me, like I was interviewing for jobs at execution, trade or to large, well-known hedge fund, for example. And they're like, Hey, we love your resume. You'd be perfect for this. But there's a guy who has five more years of experience than you from Goldman, who's willing to work in the same position for the same salary. And we have to hire like, you know, just logical. We have to hire him instead of you. And that happened like two or three times. And I'm like, All right, this is not good. Well, this was
Patrick (CEO of WSO): [00:29:42] This was right after the financial crisis, too. I mean,
LiberalArtsBanker: [00:29:44] This was right in the middle. This was two thousand nine.
Patrick (CEO of WSO): [00:29:46] Yeah, yeah. So it's like there's just the street was flooded with incredible talent.
LiberalArtsBanker: [00:29:51] Yeah, it was. Yeah. And a lot of people wrote it out and stayed in trading or or wrote it out and found different areas, whether it was servicing, trading or, you know, doing other kind of things around the trading ecosystem in exchange or elsewhere. But I mean, let's put it this way I worked with probably two hundred different like youngish traders, call it, under 30 year old traders across four or five years. And I think like less than 10 of them were still trading now. Wow, that's crazy. So a lot of attrition too.
Patrick (CEO of WSO): [00:30:24] Before, yeah. So before we jump into kind of your business school thing. Any comments on how things have moved kind of 10 years later now in terms of just gotten more data comp sci heavy, obviously more automated? Yeah. Tell me a little bit about your thoughts in terms of your perspective. I know you haven't been in it for almost. Yeah.
LiberalArtsBanker: [00:30:42] Well, you yeah, I still cover like that ecosystem a little bit and still pay attention to what's going on. It's just a tough market for jobs there. I mean, the largest employers of traders and sales in sales and trading are obviously still the banks, but I'd say the vast majority of people who go into sales and trading at a bank, you end up more in a sales type role than a real proprietary decision maker as a trader type role. And it's not. I'm not saying it never happens, but like they pick a very select few of every class to say, Listen, if we're going to have some prop some people with proprietary capacity, like after training or as people start on the desk, those people get identified and kind of siphoned off into more what I would consider real like market making or flow trading type roles. Most of the people end up in a more sales type role where you're covering asset management clients. You have to understand the markets. You may have some proprietary capacity to trade against your clients or execute things on a on an agency basis. But, you know, it's not the same to me. There are two kind of different skill sets one's relationship driven and one's more like, you know, a lot of the best traders. They lock them in a room. They don't even let them talk to clients because one, they don't want the clients picking their brain. And two, they tend to be prickly people whose time is best spent focusing on the markets and their screens. Yeah. So I'd say from my perspective, proprietary trading at a bank
Patrick (CEO of WSO): [00:32:16] Is tough, but there are lots of hedge fund. Like what about hedge
LiberalArtsBanker: [00:32:20] Funds, hedge funds? So there's lots of great independent trading firms. You know, just to rattle off a few off the top of my head that that hire a lot of people out of undergrad. Now, a lot of these firms tend to now focus on people who have intensely quantitative backgrounds, but you can still talk a few of them into an interview. And if you do well in the interview, I'm sure you can get in there if you just prove some analytical value to them, whether it's in gambling or otherwise. So firms like Peak six, Wolverine, Susquehanna, Jane St. maybe a little bit less so. Jane St., who are some emcee up to her on the European side, a lot. Insurers know a lot in Chicago. You know, a lot of them were a lot of options firms and futures for traders out of the Chicago.
Patrick (CEO of WSO): [00:33:11] Are those teams growing at all at those prop shops or are they staying the same size? And kind of there's some attrition?
LiberalArtsBanker: [00:33:17] Yeah, my guess is they're staying the same size. The industry has been consolidating. You know what you've seen, for example, on the equity side over the past 10 years with Vertu kind of has just hoovered up every one of their main competitors almost. Yeah, that's going to continue happening across other asset classes, whether it's. Affects their futures or options, especially, I mean, options and index ETFs options, especially. Have Lent has lent itself to growing these huge firms that trade everything because you're trading underlying, especially ETF and index, right, you're trading the futures, the cash baskets of stocks, you're trading multiple different classes of futures, you're trading options on the futures or trading options on the cash. You're trading all the ETFs. And there's, you know, for the S&P 500, there's probably, I don't know, one hundred plus ETFs that are highly correlated to the S&P five hundred, if not directly linked to that index. Yeah, yeah. So it just creates these huge behemoths of firms that are good at all of this stuff. Yeah. So I would expect that it's going to continue consolidating. Those firms may be growing their classes, but when you think about they're going to acquire three other firms that do similar things that used to hire ten people a year, like it's all going to continue to get hoovered up by the largest, most successful firms. So listen, it was a great experience.
Patrick (CEO of WSO): [00:34:42] But you saw the writing on the wall. I saw the writing on the wall. What was that? What was that kind of that day or that that break where it was like, maybe you were like, I just got to go to business school, right? Go to banking. Like in why banking? You know, because I been like I
LiberalArtsBanker: [00:34:57] Said, I had been interviewing around and not just
Patrick (CEO of WSO): [00:35:00] 2009, 2010, I mean,
LiberalArtsBanker: [00:35:01] 2009, 2010. It's a bad track. It was awful time and I was trying to find, you know, even I was open to leaving trading, but I just kept running into the same headwinds of like, Oh. How are you going to convince me you're not going to jump right back to trading once the job market gets better or great? Like, we agree that you're analytical and you can answer all these great logic questions and whatever. But like, I don't care about that. I need somebody who's good at PowerPoint who can put together a simple right like, and you know, they both are skill sets. It just happened that I had one at the time and I didn't have a great one. I was good at Excel, but like I said, I don't know anything about accounting or corporate finance
Patrick (CEO of WSO): [00:35:40] Or anything that they don't really care about raw intellectual horsepower. They care about just how much or how hard you're willing to draw. Yeah.
LiberalArtsBanker: [00:35:47] For experience hires. Yeah, that was at the time. I mean, I was competing for a lot of roles that weren't necessarily in banking, but they were, you know, similar skill sets and they're like, Why am I going to hire this guy who is a trader? And he'll take three months for me to teach him everything when I can just hire an analyst from any investment bank who's been doing this for the last two years?
Patrick (CEO of WSO): [00:36:06] Yeah, that's true.
LiberalArtsBanker: [00:36:08] It's one hundred percent sure now that I've worked with lots of analysts.
Patrick (CEO of WSO): [00:36:12] So tell me a little bit about just the that decision the year. What is like when you made the MBA? You said top 20. It was wasn't the top, top business school. Why go there? Then why not?
LiberalArtsBanker: [00:36:25] It was a timing thing. It was really it was the fall. It was like late in the fall. And I was, you know, when we started our own shop, like we all had to put up some money. And then, you know, I put up I was the most junior guy and I didn't have the money I didn't want to put up. I had savings, but I didn't want to put up my money and just dive into this further at the moment. So I basically said, Listen, I'm not going to take a salary, but like, I'll fill up my partner capital first and then like, I'll go and I'll start paying myself after that with my cut of profits. And what happened was the market got so volatile in the summer and fall of two thousand nine. If you think about especially the Treasury market, like we were in the heart of quantitative easing, like things are only going one way and kind of uncorrelated fashion, sometimes you can imagine when the Federal Reserve is in buying Treasury bonds, things tend to go wild. I mean, risk all risk parameters that we had got blown out and like it was just a completely unsure footing and the partners just cut everyone else's risk besides themselves to a point where it was uneconomic for me to show up every day like I, they cut my risk so much that I couldn't. I didn't have visibility into filling up my partner capital and being able to pay myself for like any time in the foreseeable future. Got it.
Patrick (CEO of WSO): [00:37:45] And it just wasn't a risk like you weren't allowed to put on anything.
LiberalArtsBanker: [00:37:49] Yeah, I wasn't allowed to have positions on of a size where I thought I was going to be able to make money over my nut, which might not was. I had to make like, I don't know, it was like twelve thousand five hundred bucks a month to cover our like tiny little office rent and connectivity and stuff. Right. So if I had to cover my nut and then I owed, I had to come up with like 50 GS to fill up my partner piece. And I just thought, like, this is going to take six months. I can't work for nothing for six months. And so I was interviewing and finally, like, I just capitulated. I had I always said, like, there's no way I'm going to need an MBA like I because in training, like if you're good at it, you can go see the world take you.
Patrick (CEO of WSO): [00:38:28] It was the last option.
LiberalArtsBanker: [00:38:30] It was really, you
Patrick (CEO of WSO): [00:38:31] Know, well, that's honest. Ok, so
LiberalArtsBanker: [00:38:33] So I took I took like two weeks to study for the GMAT and signed up for a game at like the only time I could get. And I was in the New York area around the New York area was like right before the holidays was like a six a.m. slot. It was like an hour and a half away, so I got up at 3:30 a.m., drove in there, had breakfast and took the GMAT after studying for like a week and a half and I picked five schools, I applied to a couple of really good ones, a couple of middle tier and one kind of safety. I was on some wait lists with the top. It was two top five schools. I got a one way list. I was on another wait list for the middle one and then I got into the other middle one where I ended up going and I didn't choose the schools will or just on name recognition. I chose ones that I knew had good track records in banking recruiting. Yeah, especially with firms in New York area, which I wanted to be back in New York. It so I was thinking about. I was weighing the like, Do I want to wait and wait on this, the top five one on the wait list? And these were extremely competitive years for MBA. Yeah. If you remember correctly, like if you look at I look at like
Patrick (CEO of WSO): [00:39:44] Everyone's unemployed,
LiberalArtsBanker: [00:39:46] Everyone was running for their two year vacation of MBA, but being a little bit flippant about it. But so, yeah, I was I was weighing like, Do I want to wait this one out or should I just go? And if I wait it out and I didn't get in like I would have probably retaken the GMAT to try to get a little bit higher score because I wasn't completely happy with my score. And I would have done the whole recruiting process, which I didn't realize then. But I realize now after going to MBA like the recruiting process for MBA is just do we think it's like mimics a corporate recruiting process because they want to see if you're going to be good at getting a job eventually after you get to the program? So it's like, have you done your research? Do you know why you want to come here? Have you talked to alums? Do you know the specific the differences between the school versus our three biggest competitors? What value we bring versus what, what they are better at stuff like that, and that's really just them screening for people that they think are going to do all the legwork and do a good job when they're looking for their job after they get to the program, right?
Patrick (CEO of WSO): [00:40:51] So their placement stats look good when they're done. Exactly.
LiberalArtsBanker: [00:40:55] So I decided I didn't feel like waiting a year, and I just I said, Let's do it. So I accepted the MBA offer, like in the winter, still traded for a couple more months and told my bosses that I was leaving. And yeah, so I had a couple of months off in the summer to kind of get ready. And obviously they gave you like those like MBA, like pre prep courses where you actually take accounting and you take corporate finance and stuff like that. So. So I was ready to go by the by the time I got there in July.
Patrick (CEO of WSO): [00:41:29] And did you so did you take out some loans just to help finance your?
LiberalArtsBanker: [00:41:33] I took the whole the whole spiel.
Patrick (CEO of WSO): [00:41:37] Very nice.
LiberalArtsBanker: [00:41:37] And it turns out I'm not getting paid for like almost a year can really put a dent in your finances.
Patrick (CEO of WSO): [00:41:43] Yes, especially if you're at an MBA.
LiberalArtsBanker: [00:41:46] Exactly. No, I meant I didn't get I almost I got I made like fifteen thousand total the year before I went. So that's was, yeah.
Patrick (CEO of WSO): [00:41:56] And then you're an MBA for two years
LiberalArtsBanker: [00:41:59] And I was MBA for two years. You know, obviously enjoying myself as well as studying. So came out, came out of MBA and I actually bought a condo in the worst month ever by a condo in the history of the United States. September of twenty seven. Oh, so I was in a very interesting financial picture, which is another attraction.
Patrick (CEO of WSO): [00:42:20] How do you want to share with a condo, was it?
LiberalArtsBanker: [00:42:21] No, it wasn't, it was in the middle in a city. It was a decent market. Not a good offer.
Patrick (CEO of WSO): [00:42:28] Did not like not flood sufficiently. Yeah, OK.
LiberalArtsBanker: [00:42:33] I still have friends, by the way, who are underwater on their houses. They bought in Charlotte in two thousand eight. But as an aside.
Patrick (CEO of WSO): [00:42:44] So you say you come out?
LiberalArtsBanker: [00:42:45] Well, I come out. I'm like, You're already.
Patrick (CEO of WSO): [00:42:48] And you know what you want. You're kind of interviewing right away doing the whole cocktail hours. And yeah. Tell me a little bit about that whole process. And was it surprising? Did you feel like you? You had a good shot all the way through? I was summer, so I was,
LiberalArtsBanker: [00:43:01] Yeah, I was a little surprised that like because I had been trying to find a new job for over a year, probably. And I was like, Oh, great, now I'm going to be in this program and I'll get a really good footing and I'll get a little break from the job search. And like, the first thing you do when you get there is get your resume ready to get your network ready. What do you want to do? What's your mission statement? What's your elevator pitch like? That's like the first week? Yeah. So it's like right into recruiting and then you're right into I think I spent like a combined day on the Bolt bus and the mega bus going to New York, like, you know, doing the networking events and coffee chats with alums who new MBA Associates who came out of my school and we're at the different banks. And from there, you know, it was just every one of those conversations. It's trying to pick up something that you can use in a later conversation that you didn't know about the industry, that you didn't know about the firm and then demonstrating some kind of value to them. Like, ask a good question, have an interesting thought, have something from your background that is germane to them in whatever industry they cover.
Patrick (CEO of WSO): [00:44:11] Did you know all this stuff before the MBA? Did the MBA help guide you or is it something the MBA?
LiberalArtsBanker: [00:44:15] Yeah, the MBA. They were good at preparing you for all this right? And your first a hierarchy of resources available at most MBA programs. First is the second year because they just went through this last year and they are willing to help, and they are part of the value that they bring to their prospective full time employers. And most people sign up for full time before they even leave their summer right? Is to identify the good candidates for next year and make sure that everyone they're getting the best quality candidates in for their networking events and applying and stuff like that. But I think there's
Patrick (CEO of WSO): [00:44:49] A lot of kids targeting banking out of that to your school. Yeah, yeah, there were pretty competitive and like, were you worried ever at some point like, Oh man, I'm dropping all this money on this MBA and the economy's still not how many, and I could come out with nothing.
LiberalArtsBanker: [00:45:03] I was a little worried, so I, I considered like trying to go to a hedge fund. There is an alarm at a hedge fund that we like kind of clicked, and he was like, I'm not going to know if we're going to need any interns till like. April, yeah, and and I thought about it, and I'm like, I just can't do it like I need a paycheck and I came here to do banking like I want, like I want the skill set, at least for the summer. We'll see if I hate it after the summer, I'll figure it out. But like, let me get like an offer for the summer.
Patrick (CEO of WSO): [00:45:34] Tell me, how was that summer not having any of that accounting, at least on the job or any of that?
LiberalArtsBanker: [00:45:39] I mean, it was fine. Banking is not rocket science, right? Like, you're not doing really highly quantitative stuff. It's just nuts and bolts of you're just learning the nuts and bolts of how banking works, which is its own little esoteric part of finance, which the only way you can learn you can take as many classes as you want. But the only way you can learn is to sit there as an analyst or a junior associate and really dig it, learn how to model, learn the different the differences in business models between clients and your coverage universe. Learn why you adjust someone's earnings for something, but you don't adjust someone else's earnings for something and how that changes their multiples or how it changes how you think about them, like if one of them gets acquired in an M&A context and stuff like that, and then how the whole how the whole process works to how a pitch process works. So, you know, going to a client for a quick catch up where you're going to bring 10 pages that are mostly off the shelf is a lot different than responding to an IPO RFP that you're going to work on for three weeks and it's going to be turned one hundred and seventy five times, right? But like going into banking, you're like, Oh, one's a pitch.
LiberalArtsBanker: [00:46:48] The other one's a pitch. They're like the same could not be further from the truth. So learning all that stuff was interesting, but the nuts and bolts of it are pretty, pretty easy. And luckily, one of my really good friends at business school had been a bulge bracket analyst, you know, through the beginning of the crisis there. And he was, you know, he really kind of gave me the ropes of what the different job roles are, what you can expect your work life balance to be, what types of MDS there are between the execution side of things or more coverage or very senior people who are like the managing director of having lunch and never generated work for junior people. So it's just it was a good like a little bit of a cynical view, which also helps. But because he was he was going to business school banking. I was going to business school to get into banking.
Patrick (CEO of WSO): [00:47:38] It's like the jaded analyst to you.
LiberalArtsBanker: [00:47:40] Exactly, exactly. So now the summer was fine. I got split between two industry groups that were not fake. So all of that whole spiel I gave about going into something where, like I had a little bit of operational knowledge was didn't really apply. Like I spent my summer in health care and something else that I knew nothing about. But. You know, the learning experience isn't about the sector, the learning experience is how banking works, the
Patrick (CEO of WSO): [00:48:07] Process
LiberalArtsBanker: [00:48:08] Process wise.
Patrick (CEO of WSO): [00:48:09] So you're there, you sounds like you get the full time offer, right? Yeah. This summer in terms of they also pay you over the summer, which is nice. You need that paycheck.
LiberalArtsBanker: [00:48:20] Pretty, pretty
Patrick (CEO of WSO): [00:48:21] Well. Yeah. And then, you know, were the hours about 70, 80 hours a week or so,
LiberalArtsBanker: [00:48:26] I'd say on average, it was like 80. And I had a couple of bad weeks that were a hundred plus maybe two weeks for bed.
Patrick (CEO of WSO): [00:48:34] Ok. And so you still came out of that and you said, OK, I'm just going to go for this because you got the offer.
LiberalArtsBanker: [00:48:39] Well, one thing they do is they dangle like 50 grand in front of you that you can have, like the next week, like if you sign
Patrick (CEO of WSO): [00:48:48] A signing bonus.
LiberalArtsBanker: [00:48:48] So, yeah, so I investigated laterally, not laterally, but going switching from my from my internship to full time. Yeah, but at the time, like these weren't big classes. A lot of banks and everyone was accepting their offers because the economy was still in crisis. Yeah, yeah. So, you know, that quickly went by the wayside, and I pretty quickly took my took my return offer fair.
Patrick (CEO of WSO): [00:49:15] Ok, and then that.
LiberalArtsBanker: [00:49:16] But I did caveat that I needed to be in Sage got it. Which, you know, they made. They made a concession on that.
Patrick (CEO of WSO): [00:49:23] Got it. Ok? So you basically had that was that. Do you feel like that's a little bit unique that you want to be in fit? Because I've heard some people say they don't want to be. I think, yeah,
LiberalArtsBanker: [00:49:35] I think it is unique because people, especially analysts, I hear this from our analysts a lot like, Oh, we don't want to get pigeonholed and spend all of our time working in or insurance. And then like, I'm doing it for the rest of my life. And you know, everyone thinks that working in depots or insurance hurts your by side hiring.
Patrick (CEO of WSO): [00:49:57] What's your thought? What's your thought on that?
LiberalArtsBanker: [00:49:59] I think most banks realize that, and they're going to make sure that you get a diverse experience where you're working with both companies that are balance sheet base. Whether it's Depot's insurance, specialty finance, whatever. And you're working with some companies, right, where you're actually doing, you know,
Patrick (CEO of WSO): [00:50:13] A fake even at a junior level. What about yourself? What about yourself? Because you did say something of a buy side, what about you being in that group? Had you had you was beset on the radar at all when you were coming out of business school?
LiberalArtsBanker: [00:50:25] Yeah, it was. I mean, like I said, banking. I always viewed banking as a stepping stone. I didn't think it was going to be,
Patrick (CEO of WSO): [00:50:31] But it hasn't been even almost 10 years like a banker for life right now at this stage.
LiberalArtsBanker: [00:50:35] Well, not quite.
Patrick (CEO of WSO): [00:50:36] But yeah, now that you've been there for, yeah, you've been in for a good number of years. Yeah. So a little bit about, yeah, just you do.
LiberalArtsBanker: [00:50:45] Was it you can get? Pigeonholed to fig specific things, which is fine from my perspective, because FIG is a large part of a lot of different investment funds, right? So the mega funds like what percentage of Blackstone or Carlyle, I mean, Carlyle had their own dedicated fig fund. Yeah, just wrapped up a couple of years ago or something. Mm hmm. And there's plenty of dedicated fig buy side shops that do really well Stone Point and light year and flowers, and there's ten other ones. Yeah. So I thought there was enough of a buy side ecosystem where I was comfortable that that would be an alternative. It's sometime in the future. And, you know, fig investing has only exploded really since I've been a banker, pretty much with one thing all of the big alternative managers getting into insurance. Hmm. So Apollo, with the theme being the first one, then Blackstone's got their insurance operations. They bought a platform for a couple of years ago. Kkr just bought Global Atlantic two weeks ago. So now all of these big. Powerhouse private equity firms. Need people who know how to invest in insurance assets as well, you know, to understand the insurance, I have a balance sheet. So a guy I worked with actually, who was a managing director at a private firm. He spent most. He covered alternative asset management with me a little bit, but he also spent a lot of time in insurance, and he ended up getting hired at one of these firms to help both do some fake investing, some kind of corporate development for the house, but do a lot of help us grow our insurance business. Wow. Yeah, it sounds through acquisition. Yeah. So you're there,
Patrick (CEO of WSO): [00:52:34] So you're there for a few years and you had that opportunity, like you said, to kind of go from the middle market to the bulge bracket and try to get more on some kind of be the lead, the level of the deal kind of improving. And so you did that after a few years. Was there any sort of pay bump that went along with that? I mean, I assume you were getting standard associate pay. Yeah, you didn't get promoted to BP told that until that bulge bracket?
LiberalArtsBanker: [00:52:59] Yeah, yeah. So there was a small pay bump from the middle market. I mean, not on the salary side. The salary was the same or I even took a little bit of a decrease actually put. The bonus was, you know, not like 50 percent increase, but probably like twenty. That matters. So yeah, it was a good a good pay bump. But I also had to take stock. So at the middle market firm, I didn't have to take any stock at the bulge bracket. I had to take stock and unfortunately it's only on one. It only went one direction
Patrick (CEO of WSO): [00:53:28] While I was there and that was like a restricted stock unit. So you had to wait for them to vest or they were.
LiberalArtsBanker: [00:53:33] Yeah, yeah, yeah.
Patrick (CEO of WSO): [00:53:35] Three got it. So in terms and did it, was it always rolling? So every year you'd get a lot, a big chunk of
LiberalArtsBanker: [00:53:41] Every year you'd have to get a bunch of it. Yeah. And you know, when I eventually switched to Goldman, you know, that's part of a package. When you switch and you have stock, they usually replace your stock. Yeah, they try
Patrick (CEO of WSO): [00:53:54] To make you whole. They try to.
LiberalArtsBanker: [00:53:55] Yeah, great.
Patrick (CEO of WSO): [00:53:57] So you so talk to me about kind of that final transition. You know, to me personally looking at your background and you're saying, you know, potentially by Saturday, why not just stay where you are and get director or managing director?
LiberalArtsBanker: [00:54:12] So this is a little bit of a. A personal I mean, it just happened to be the area I cover, I would look around and look at a bunch of my clients and say, Oh, you know, you work with people and say, Hey, that guy's a great guy and he's got an awesome job, right? He's corp dev at a big public private equity firm, or he's one of the guys at one of these platforms that's doing minority stakes like Dial and Blackstone and Pearson, which I covered them. Now I know them really well. And like, Oh, that'd be a great. I would love to have a job like that. Or he just got hired out of the bank, and now he's a VP at one of these big focused buyout firms like your aquiline. Or some point. And overwhelmingly, when I would do that. The background of that person was they worked at Goldman like 80 percent, if I did that with 20 people, I swear like 15 or 16, I worked at Goldman. And it's probably a little bit of just luck on that end because, you know, I've met lots of people with great jobs who never who worked at lots of different types of banks or consultants or did 50 different things, right? Yeah. But it just so happened in the alternative asset management industry for these people who tended to be like my level or a little bit above. At the time, like a lot of them had this very similar seat where they left, when they were either a VP or junior managing director at Goldman.
Patrick (CEO of WSO): [00:55:38] It's really interesting. Yeah.
LiberalArtsBanker: [00:55:40] So I figured, listen, if I'm going to really try to do it and put myself in the best position to get that next seat at that next seat where I'm going to make hopefully like the vast majority of the money for my entire career, and I hope I'm there for 15 years and become a senior partner or whatever like this is my career, right? Everything up to this from trading. You know, one of the things I was going to mention is the benefits of flexibility and being able to pivot to other things, right? So pivoting from trading to business school to banking to a couple of different firms all leading up to this next job, I thought the best place to do that from would be Goldman versus the firm that I was working at previously.
Patrick (CEO of WSO): [00:56:17] Yeah, that makes sense. I mean, if you're looking at that, looking at the path of other people who've done it before. Make sense.
LiberalArtsBanker: [00:56:22] Yeah, and that makes the cost of switching. That's that what got me past the cost of switching, which was giving up pretty, pretty easy path up.
Patrick (CEO of WSO): [00:56:35] Yeah. Or yeah, in terms of easy path up all the way to pass
LiberalArtsBanker: [00:56:38] Up and being rated well every year and having a good network in terms of supporters throughout the firm at my Old Firm and going into Goldman, which you know, is known to be a little bureaucratic and a little bit more competitive than other places, but it that way makes
Patrick (CEO of WSO): [00:56:55] Sense. Okay, so before we call it anything else you'd like to share for the younger listeners, I mean, your path has been interesting. Yeah. Is going to banking and making that transition.
LiberalArtsBanker: [00:57:06] But yeah, you know, I would like to reiterate. Being flexible, being open to opportunities, and just because you didn't go to a school that is like a core recruiting school or just because you didn't start in your first job at Goldman or GE or J.P. or Morgan Stanley, like. After a while, like people care less about where you went to school, they care less about where did you start your career? It's you're in a room with someone and you know your industry. You know, you can talk knowledgeably about the deals you've worked on. You can talk knowledgeably about the clients and the sector that you cover. You can talk knowledgeably about what's going on in the economy, in that industry. And after a while, that trumps everything. So when I was at this European Bank. Um. Look, we would hire people from Ivy League schools, we would hire people from, you know, Midwestern state schools, we'd hire people from all over. And just based on, you know, senior people and they could get people in there for interviewing and to tell you the truth. Our best analyst, when I was a staffer three years in a row when I was there were probably from schools that you would never assume. Would even have anyone going into banking in New York from Midwestern big time schools like and not like Michigan, like other ones
Patrick (CEO of WSO): [00:58:33] Like other No-Name,
LiberalArtsBanker: [00:58:35] Like those garden? Yeah. And those guys like killed it and our worst analysts was from Princeton. So like, once you get in like you need to do the job A and B like people stop caring about all that stuff. And I know when you're in school, you get caught up with it and you get caught up with the need to go to the best. Like the goal should be. I need to get a seat in banking because I want to do banking and learn which you can do at a lot of different places. And then if you want to switch to a better firm, you go into that interview with the other firm, right? Or the higher tier or the bulge bracket and you say. You know what, we only did one lead M&A deal, but here's what I did with it. I built the whole merger model. I did the same. I kept I ran the whole diligence process. I kept a buyer list, you know, X, Y and Z. Talk about it for forty five minutes. Know all the nuts and bolts of it, and you'll just blow someone's socks off and have it offer before you even know it. Yeah, but that's different than saying, Oh, I'm not going to get a job at Goldman or JP Morgan Stanley, and I shouldn't even do bank.
Patrick (CEO of WSO): [00:59:43] Yeah, there's a lot of that on the on the forums. Unfortunately, I try to.
LiberalArtsBanker: [00:59:46] Well, that's why that's why I brought it up. And it's important. It's important. A lot of you know, not. I've been moderately successful making my way kind of along in banking. But, you know, I work with a lot of people who know founders of private equity firms and hedge funds who, you know, the path wasn't as they expected. Maybe they tried to launch their firm and struck out the first time around, or maybe they were in a corporate and they thought that they had a startup that was hugely valued and it blew up, and then they had to go pivot to something else. But you know, there are benefits of being versatile and flexible as you move throughout your career and you never know how things are going to work out. But, you know, every experience ends up being valuable. And as long as you're dedicated, willing to do the work, willing to learn, things tend to work out more often than not. And people, people recognize that, you know, we hired lots of analysts and associates laterally when I was at the bulge bracket. And now Goldman confirms that you would never expect, you know, small regional shops, middle market boutiques, stuff like that. Just because someone comes in and you can just tell they can do the work and it's no different. Just the numbers are bigger.
Patrick (CEO of WSO): [01:00:58] Yeah, for sure. That's awesome. Yeah. Well, listen, thanks so much for taking the time to share your, your story and your knowledge with all of us.
LiberalArtsBanker: [01:01:07] No problem.
Patrick (CEO of WSO): [01:01:08] And thanks to you, my listeners at Wall Street Oasis, if you have any suggestions whatsoever, please don't hesitate to send them my way. Patrick at Wall Street Oasis dot com. And till next time.
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