In today’s Finshots, we tell you a tale of distractions, reputation, and ethics when a Wall Street CEO indulges in a side hustle.
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In June 2022, Whitney Houston’s classic song I Wanna Dance With Somebody got a new official remix. The man behind it was a 60-year-old DJ named David Solomon and the track quickly became popular. It climbed the charts and was soon a summer favourite. It was the biggest hit of David Solomon’s career.
But wait…there’s something you should know about David Solomon. He has a day job. And quite an important one at that. He’s the CEO of the legendary Wall Street firm Goldman Sachs.
Sounds crazy, right?!
It looked like David Solomon was living the dream — a globe-trotting CEO by day and a turn-table spinning DJ by night.
But suddenly, this dream has come to an abrupt halt. Because on Tuesday, the Financial Times reported that the CEO had called time on his side hustle. He’d hung up his deejaying boots. Now this isn’t a story about how David Solomon became one of the most powerful CEO’s by day and a roving DJ by night. Rather, it’s a story about 3 things — distractions, reputation, and ethics.
You see, the biggest problem right now is that the investment bank is going through quite a tumultuous period. The bank laid off 3,200 employees. Its foray into consumer banking with a sub-brand called Marcus began to fail. The profitability took a beating with the latest figures announcing a 30% drop in the bottom line. Meanwhile, Solomon’s predecessor, Lloyd Blankfein, lambasted him at an annual Goldman Sachs retreat. He said that the bank was in trouble because Solomon was distracted by deejaying at nightclubs. The criticism came thick and fast.
And it didn’t matter that most folks actually knew that Solomon was a workaholic. Apparently, he’s someone who doesn’t take more than 3 hours to respond to an email. It didn’t also matter that there might be some real benefits to being a CEO-DJ. You see, back in London, Ali Miraj, a managing director at banking giant ING moonlights as a DJ too. In fact, he actually thinks it helps his cause. It gives him a unique edge. That’s because clients are always being pitched deals by bankers. And Miraj believes that such side gigs might have actually helped him bond and land better deals. And maybe even become a better dealmaker.
Unlike some DJs, he doesn’t arrive with a preordained set, but adapts his playlist to the room. “It’s a communal experience — you are feeding off them, and they are feeding off you,” he says. After years of doing this, Miraj says he’s become more attuned in client interactions too. “If the client isn’t responding, you need to change the record. There’s no point in trying to push a deal or mandate down a client's throat when they're not interested."
Being a good DJ is about “observational skills” and building rapport, Miraj explains.
But maybe the Goldman Sachs team didn’t believe that David Solomon’s gigs added any value to the business.
Then there was the problem of image.
Take the case of David Solomon’s set last year at a massive music festival called Lollapalooza. It’s an event that’s quite infamous for rampant drug use. People have even died due to drug overdose. And that’s not probably good for optics for a Wall Street CEO. Maybe that’s why when Solomon once pointed out that deejaying is simply a hobby, just like how other bankers took to golfing as a hobby, a board member said, “No one has ever OD’d at Pine Valley or Shinnecock [golf clubs]. There’s a reputational thing.”
So maybe the kind of side hustle does matter when you’re the CEO of a Wall Street legend. Maybe there’s a Do/Don’t list someone should create. Yes to running a local library. No to playing music at nightclubs.
And finally, there’s the elephant in the room — the question of a conflict of interest.
See, getting the rights to remix a classic track of the late Whitney Houston isn’t easy. You can’t just waltz into her office and make a pitch to the folks in charge. You probably need to know someone who knows someone to even get a meeting. If you’re an amateur music producer that is. But what if your investment bank managed the business for a top tier music executive who could pull some strings? Maybe you’d be tempted to cosy up and nudge him into helping your fledgling DJ career too.
And that’s what some people are worried about. See, Larry Mestel, who runs one of the biggest music catalogue businesses in the world, is also a client of Goldman Sachs. He’s the one who convinced Whitney Houston’s team to give the green signal to Solomon.
Which begs the question — was it Solomon’s DJ talent that landed him the gig? Or was it a sweet connection he made through the bank?
Now usually, you might say that there’s nothing wrong in calling in a favour. But the thing is that the year after this gig, Mestel found a place in an annual list published by Goldman Sachs. A list titled “100 Most Intriguing Entrepreneurs”. Apparently, this was a project overseen by Solomon.
A case of quid pro quo?
No one can be sure. And that’s the problem. For a bank like Goldman Sachs, these are reputation and ethical dilemmas that simply can’t be ignored. It’s bad publicity. And unfortunately for David Solomon, it meant choosing between being the CEO of one of the most powerful banks in the world or crafting music alongside Metallica and Dua Lipa.
Maybe that's a stretch. But yeah, it's an interesting dilemma nonetheless.
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