The banker who was fired after listening to millennials

If you prove you lose. There are few better examples of the truth of this old politician’s adage than when the human resources department of a financial firm starts churning out charts to demonstrate that employee attrition is not materially different from normal levels. That’s apparently what happened at Carlyle Group a few months ago, and in retrospect it should have been seen as a real wake-up call for CEO Kewsong Lee, who stepped down this week.

The official statement suggested that his departure was just a matter of not being able to agree on numbers for a new contract (apparently the board didn’t even want to talk about a $300 million request out of five years) but “people with knowledge of the matter” seems to have started talking pretty quickly about serious underlying tensions with seniors and founding shareholders. And that’s what anyone could quickly train if they knew attrition charts.

Graphs and numbers, when it comes to staff turnover, are usually accurate but still irrelevant. When people worry about attrition, it’s never about “how much” and always about “who”. Hardly any stakeholder outside of the C-suite is able to give an estimate of turnover percentage and most of them don’t even know what a normal level would be.

When they start talking about attrition, it’s because people are leaving when you wouldn’t normally expect them to leave. Big earners, GMs of strategically important teams, company loyalists and culture bearers. If a few characters like this start heading for the door, needless to point out, they don’t make much of a difference to the numbers and ratios in the big picture; people will say that there is a problem that is getting worse and senior management is losing the trust of senior management.

Which seems to have been the case for Kewsong Lee, who seems to have had the classic politician problem – knowing exactly what to do but not how to get re-elected once he’s done it. He was brought into a close and ‘kind’ corporate culture in Carlisle to be an outside voice making tough decisions, with his former co-CEO Glenn Youngkin tasked with smoothing things over and maintaining good relations. When Youngkin left to enter the civil service, it seems there was no smoothing and just the outside voice.

And in a people-oriented business, that matters a lot. Lee apparently used to say things like “Who’s the youngest person in the room?” What could we have missed? on Zoom calls. Depending on the tone and non-verbal cues, it could be just as clean and inclusive, or just as disrespectful to experienced bankers.

Likewise, if you receive advice from the billionaire founders who hired you and who still own 25% of the company, you should either take that advice or be really tactfully not to. Eventually, it seems that Kewsong Lee was not able to thread all the needles, and so it became another data point in the story of the difficulty of organizing succession planning in the industry. capital investment.

Elsewhere, M&A bankers looking for straws in hope might have found something worth clinging to this week. On the so-called “Merger Monday”, $12 billion in deals were announced.

More interestingly, only one of these transactions – although the largest, the privatization of Alvalara Inc by Vista Equity for $8.4 billion – was a financial sponsors agreement. All the others were companies buying their competitors outright, which is generally seen as a good sign for the market outlook.

Combined with the fact that the private equity backlog is still there and has yet to be executed, this could make banks reluctant to cut staff. Some transactions, after all, can be undone, but some can only be postponed. If the second-tier trades that didn’t happen in Q2 come back into the market later this year, you don’t want to be caught short without being able to execute the rush.

Suffice to say that the consequences of the shortfall this year are more in bonuses than in layoffs. It also suggests that fixed income sales and trading bonus pools could be called upon to “maintain the deductible” for capital markets and advisory.


Where real estate leads, hiring follows. That’s good news for private equity bankers in London who could fit into Thoma Bravo’s industry-focused franchise. The software-focused takeover house announced its ambitions by taking up two floors of space in a building in Mayfair. (Financial News)

“There are no more permanent friends or permanent enemies”. Instead, the biggest private equity firms exist in a state of perennial enemies with their competitors, cooperating on some deals while squabbling others. Good experience to understand why personal relationships are so important in this industry. (FT)

It’s possible to be an influencer on LinkedIn these days; the work is not unlike that of a normal influencer, but instead of glitzy swimsuits and cocktails, you have to post a constant stream of thoughts on artificial intelligence (Bloomberg)

Alternatively, real TikTok and Instagram influencers are now being used as lobbyists on political topics, including financial regulation, so there’s bound to be a crossover one day soon (WIRED)

Former UK Chancellor Philip Hammond has joined a new front trying to raise £1bn to invest in fintechs (Financial News)

As a new generation of college alumni begins receiving phone calls from their universities, a new book lays out the facts about how endowments from prestige schools really are so big, they’re transforming the whole from institution to hedge fund with interesting hobby (LA Review of Books)

Ken Griffin apparently tried to make a joint deal with the crypto organization that made a bid against him for a copy of the US Constitution, including a proposal to issue an NFT commemorating the fact that they lost. (WSJ)

Photo by Annie Spratt on Unsplash

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The banker who was fired after listening to millennials

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