For all the endless bravado and gobs of money sloshing through Wall Street, at their core, banking and trading are apprenticeship businesses. They are akin to the Florentine guilds of the Renaissance, in which the subtleties and intricacies of art and science were absorbed over many years through careful observation.
In my 17 years on Wall Street advising corporate executives on restructurings, leveraged buyouts and mergers and acquisitions, I was far from God’s gift to the profession. But watching and learning from Wall Street giants such as Felix Rohatyn at Lazard and Ray McGuire at Merrill Lynch were invaluable. Sitting in their offices, I’d observe them as they romanced a potential client to win an assignment, subtly laid the groundwork to help a big shot decide whether to consummate a merger or helped negotiate the terms of a bankruptcy. I learned how the business really worked and began to understand what levers to pull to get deals done.
I was there, and I know what it’s like. So here’s my advice to you, fellow Wall Street drones: Get back to the office.
Advising chief executives on the details of a merger agreement, navigating an initial public offering and setting up and executing a profitable trade mean watching the senior bankers and traders who have been doing it for decades. These masters have made all the mistakes that you will make — and need to make.
When advising on how much to pay for an acquisition, whether and how to begin a hostile takeover or when to bluff during a sale process, what often matters most are things that are impossible to convey via a tiny video-chat rectangle: emotional nuances, body language and subtle social cues. That’s why Wall Street bankers and traders need to get vaccinated if they aren’t already and return to their offices as soon as possible, even as the Delta variant of the coronavirus surges.
In the early 1990s, I watched Harvey Miller, a bankruptcy guru at Weil, Gotshal & Manges, go toe-to-toe in a conference room overlooking Central Park with my boss at Lazard, David Supino, as they divvied up the carcass of the disastrous leveraged buyouts of Federated Department Stores and Allied Stores. The yelling! The robust intellectual debate! The alpha male mind games! The subtle power dynamics of who pounded the table when and who ate off whose plate. Yet their jousting enabled the businesses — and many others — to get back on their feet.
I learned no less by studying Mr. Rohatyn, the mergers and acquisitions legend, as he roamed the narrow, threadbare halls of the 32nd floor of 1 Rockefeller Plaza. He wielded his absolute power through a wink or a nod to lesser Lazard partners or ignoring some of them with a stony stare. I learned to watch for those signals closely, as he advised Martin Davis, the head of Paramount Communications, in the sale of Paramount to Viacom’s Sumner Redstone in the early 1990s, a deal that transformed the Hollywood landscape.
By watching my mentors press an advantage or bluff an opponent, I absorbed their deal-making wisdom. There is simply no way that an endless series of video chats could have replaced the lessons I learned darting in and out of the offices of these men and women in Rockefeller Center or at 270 Park Avenue as I was making my way up the investment-banking ladder. (Let’s face it: You can’t suck up on a Zoom call.)
Before the recent Covid surge, fueled by the Delta variant, executives of Goldman Sachs, one of Wall Street’s biggest and most respected banks, concluded in May that most U.S. employees needed to return to the office in June. JPMorgan Chase said in June that U.S. employees would need to return to the office at least part time by July 6. The executives decided, correctly, that the benefits of in-person collaboration outweighed the potential health risks. This is the only way employees will have the chance to fully thrive at their craft.
Now, some big banks are re-evaluating their plans, amid the confusion about whether the vaccinated can safely resume life as we knew it before March 2020. Bankers and traders are not exactly frontline workers; theirs is not life or death work. And Wall Street has proved it can make plenty of money while nearly all its employees work from home.
But we need Wall Street to get fully vaccinated and back to work in person so that the next generation of bankers and traders can learn how capital is raised and distributed, how industry-transforming deals get done and how to provide the liquidity that enables the trading of stocks, bonds, loans, options and other essential financial instruments. We rarely notice until it’s gone.
There is such a thing as the art of the deal. And that artistry, too, can be lost if it’s not passed down from one generation to the next — in person.
William D. Cohan, a former investment banker, is a founding partner of Puck, a new media platform, and the author of several books about Wall Street.
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