Goldman Sachs PWM

Yes.  However, most of us here don’t have any direct experience with the PWM arena.  It’s a bit of a different world from the average retail side (even for someone go after high net worth type people).

Anyone have any, or know anyone with firsthand knowledge concerning this bank or a similar bank?

Sanfran broker is our resident HNW contributor. PM him/her, he may be able to give you some direction.

[quote=BondGuy]Sanfran broker is our resident HNW contributor. PM him/her, he may be able to give you some direction.[/quote]

Agreed.  There is also another guy/gal running around here who worked on the PWM side in some capacity at GS...I can't quite remember who it is, but if you do a search, the thread was in the last couple months. 

If you are not sh*tting us and do get hired at Goldman...please stick around, we have too few UHNW contributors on this board and there seems to be a lot of curiousity about Goldman Sachs.

Thanks for joining us here.

[quote=BondGuy]Sanfran broker is our resident HNW contributor. PM him/her, he may be able to give you some direction.[/quote]

Thank you, but not entirely accurate. I work for a large wirehouse just like everyone else here (more or less), but its in the Bay Area - there does seem to be quite a bit of UNHW in my office and most of us have a few very wealthy clients.

Really, the only REAL UHNW firms that practice wealth management, as opposed to investment product sales to the UHNW are Northern, US Trust and other wealth management boutique firms that cater to mainly inherited money and Fortune 500 C - level execs). At the top end of the wirehouse universe (GS, CSFB, MS PWM, etc), the services are really not wealth management, but actually sales. The wirehouse elite who cater to the wealthiest are a sales manager's dream - always selling all the time OR they have a billionaire client who pays the broker $750,000 a year in money market credits alone.  

As far as I can tell - at a wirehouse, the "efficient frontier" of professionalism vs average wealth level of clients seems to be VERY steep upward at the beginning and then have the same trajectory down on the extreme levels of wealth. MOST (not all) of the real UHNW brokers that I know are completely reptillian; sleazeballs or total frauds. They've been very lucky at some point (I started as a broker at Robinson Stephens in 1990) or stumbled across a crazy opportunity (my best friend in college was one of the Gettys) very early on. Some are great and very smart, but the vast majority are very disappointing once you've gotten a chance to know them.

To the question - I believe that the base is $75k/year at Goldman Sachs for Associates. GS is somewhat unique in that it pays base salaries. I don't think any other wirehouse does... I would assume that it's higher for VPs, but essentially its negligible - they will be making $300-$2 million off their commissions and I think the salary's a draw.

I have no idea for MDs - I would assume that it's like 12 million ($3 million net) or so that you'd be doing in commissions at that level...

The comp structure also changed at Goldman in the last few years....

San Fran,

I couldn’t help but see that you are including MS as a firm that caters
to UHNW clients, by MS, I hope you don’t mean Morgan Stanley. They will
also go after grandma’s 401k. The only firms at the UHNW level are:
Bear Stearns, Credit Suisse Securities, Deutsche Bank Alex Brown,
Goldman Sachs, and last but not least Lehman Brothers.

Now, I falied to mention that, ML is arguably up there but they will
take smaller ones like MS and Smith Barney etc. The guys mentioned
above shoot for 20mm+ per client. They even boast that they have a min.
of 10mm to do business with them, but that is not true. If you have
several million they will do business. The reason I know this is that I
opened my neighbors mail by accident when it got sent to us. It was a
Lehman Bros. account. They had 9 million. At the time we had a Lehman
account too. Anyway, these are your ultra net worth boys.

Rook you have no idea what you are talking about….

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If you are going to compare MS and GS you must first look at the entire firm.  MS IB division is larger than GS, MS has a retail division GS has none, and I am not even going to compare MS proprietary funds to GS.    

Generally both firms require 10 mil for PWM, but they will both work with smaller accounts.  It is asinine to say one firm will only work with a certain amount of money.

rook–you’re way off.  MS is precisely what san fran meant…that is the PWM which is quite similar (or would like to be at least) to Goldman PWM.  Only difference is that MS married up w/DW, which is the mass market retail demographic of which you speak.  If you knew anything, you’d know that was part of the whole shake up in management in the last 18mos at MS as a whole (eg no more MDW symbol, but MS instead) and and the retail arm (really the old DW side of things trying to move more towards a MS mentality, etc).  MS PWM hires MBAs, etc., just not necessarily from a top tier program.  For example, in Houston MS might hire at UT grad where as GS probably has a Wharton, HBS, or Stanford guy.  All the same once you start hunting I’m sure (unless the hunted is an alum or respects a name school more).

[quote=rook4123]Now, I falied to mention that, ML is arguably up there but they will take smaller ones like MS and Smith Barney etc. The guys mentioned above shoot for 20mm+ per client. They even boast that they have a min. of 10mm to do business with them, but that is not true. If you have several million they will do business. The reason I know this is that I opened my neighbors mail by accident when it got sent to us. It was a Lehman Bros. account. They had 9 million. At the time we had a Lehman account too. Anyway, these are your ultra net worth boys. [/quote]

Your understanding of these firms is pretty basic rook... If you read sanfran's post it clearly says MS---PWM (Private Wealth Management).  MS PWM is EASILY in Goldman Sachs territory and ML/Smith Barney are in a little different league altogether...maybe Merrill's Private Banking division is similar, but it is relatively young compared to Morgan's PWM.

[quote=DirtyDeltaBro]

Generally both firms require 10 mil for PWM, but they will both work with smaller accounts.  It is asinine to say one firm will only work with a certain amount of money.

[/quote]

I do KNOW this: Goldman tells its associates not to bring in accounts less than $2 million and that their target market should be $10 million and above.

I have many clients who are in pre-IPO situations that get calls from CSFB, MS PWM and other firms (Weisel, etc), but GS only seems to cold call the board members of those companies. My guess is that they are only interested in a client once they've already made it or whom they assume must be a big wheel if they're on the board...

[quote=rook4123]San Fran,
I couldn't help but see that you are including MS as a firm that caters to UHNW clients, by MS, I hope you don't mean Morgan Stanley. They will also go after grandma's 401k. The only firms at the UHNW level are: Bear Stearns, Credit Suisse Securities, Deutsche Bank Alex Brown, Goldman Sachs, and last but not least Lehman Brothers.
[/quote]

I missed DB AlexBrown in that list, but I didn't miss Bear or Lehman. Those firms are stuck in the past and full of brokers who are doing business with anyone who has $200k to blow on an idea; even if you have just the $200k or $200 million. Alex is a REALLY tough place to build a business right now. Technology is a JOKE - they still use Lotus Notes for Christ's sake.

After DB took over BT Alex. Brown, most of their top IR’s left and went
to other firms.  For the top UHNW practices, Goldman does it very
well.  Depending on the city you are in your salary will be
different.  You come in as an analyst who works on a team with
other IR’s (or whatever they call them over there).  Your program
is 2-3 years after which you can decide whether or not you like it,
even then, they have to decide whether or not they like you.  If
they like you, you can be promoted to an associate and actually start
working on clients and wheeling and dealing.  When you get into
this UHNW group of people, you are really doing a lot of
alternatives.  For example, GS had a Tommy Lee feeder fund
recently which I knew was hard as hell to sell against (who doesnt want
to invest with Tommy Lee).  A lot of LPs and other such investment
vehicles.  Overall, GS and MS have extremely good UHNW
shops.  GS does do a lot of pre and post IPO planning.  When
their IBD does a deal they bring in their Private Wealth group to do
all the business, so in essence, they money that GS made for the
company (or liquid) stays in the family. 

Do you guys think that it is easier to get clients if you work in UHNW at GS, MS, or CSFB than at a major wirehouse?  I guess the question is do you get warm leads to work?<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

It seems to me that it is hard enough to get people with 500k to use you if you are under 25 and at a wirehouse how the heck are you gona convince some CEO with 15 million to use you? (because it seems those are the accounts that the PWM guys are after)

[quote=futureadvisor]

Do you guys think that it is easier to get clients if you work in UHNW at GS, MS, or CSFB than at a major wirehouse?  I guess the question is do you get warm leads to work?

[/quote]

When I spoke with GS they told me that you form a team with a group of other trainees and it is up to your team to generate all of the leads.  I don't think that even with a name like GS behind you that getting a 10mm+ client is an easy thing to do.  These people are all somewhere else and you need to give them a good reason to leave.  I feel that it's especially difficult being a team of newbies as opposed to being a newbie on a team of seasoned professionals (That's the way that JPM does it).

I do however think it's easier to get a $10mm+ client working at GS, JPM, UST than if you are working at a standard wirehouse.  Most of the UHNW people want/need a team that is familiar with the specific needs of the UHNW segment.

--WM

I stand corrected, I am clearly out of my element here. I will say
this, though Goldman Sachs has one hell of a better reputation than
Morgan Stanley. If you want to argue this, than I am all ears.



Sidenote-

The word on the street is that EDJ is forming a higher net worth
division, that is why all the EDJ brokers are getting there series 66.
Maybe once they are set up, they will be like MS higher net worth
division, but probably better

Again, Rook you have no idea what you are saying…

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Your knowledge comes from the retail side.  MS PWM is just as prestigious as GS.. 

Everyone has made excellent points in regard to starting with GS. 

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Here is a question for everyone:

 I bet if you compared a boiler room superstar (example JT Marlin) and a GS superstar solely on pure SALES ability, the guy from the boiler room would come out on top.

At one time there actually were JT Marlins out there.  I think today they exist more so in the mortgage industry.    

Wait a minute, are we talking about Morgan Stanley, ok b/c I was
confused. Yes, Morgan Stanley is the best firm in the world.
Especially, the private wealth management side.



I believe you are in denial my man.



I will put it like this, I read a lot. My spelling sucks, but anyway,
in no place that I’ve read, and yes I’ve read about MS PWM before, does
anyone ever compare GS and MS PWM. I’m not going to say that MS is not
better than AG E, or EDJ, but it is by no means a GS even when you are
talking about the MS PWM. Sorry buddy, somethings are just what they
are.

I disagree, nobody with any real money would buy anything from some
fast talking jerk on the phone. I have no doubt that they made money
and ripped some people off. However, big transactions aren’t easy like
that unless you are their broker already or you have established 
rapport of some sort. Normally this means meeting them or at least
seeing what they look like. Newsflash, generally your HNW individuals
are very well educated and have worldly sense. Getting some dumbass to
buy $5k of stock b/c your a slick talker is one thing, but presenting
and convincing a real whale to hand over his money is something else.
The biggest misconception about sales ability is that you have to be
slick or smooth and have just the right things to say at the right
time. The real successful sales people in any industry work their ass
off, and have good rapport with the client.

Now, if you put those guys against GS guys in a used car lot, it would be a much different story, boiler room guys all the way



-Also I would like to say, I don’t know a fair amount, and I can admit
when I’m wrong, and I’m still learning a good amount as well, but
having said that I also know when I’m right!

I would put MS PWM up there with GS.  Look at the resources of the
top 2 investment banks on Wall St.  Things like Morgan Stanley
alternatives, Morgan Stanley Real Estate Group, Morgan Stanley
Consulting Group.  These are some of the best groups in the
industry.  I dont think any of you would know about that because
most of these products have a minimum of at least 1-2mm.  If you
come to a client with something like MSREF, a Thomas Lee feeder fund,
they just cant get this anywhere.  If anyone knows what they are
talking about, they know MS has a brand which is known as one of the
top 2 firms on the street, GS is very good too.  Wither way you
cut it, you would be in a very good position if you had to choose
between the two. 

[quote=rook4123]I stand corrected, I am clearly out of my element here. I will say this, though Goldman Sachs has one hell of a better reputation than Morgan Stanley. If you want to argue this, than I am all ears.

Sidenote-
The word on the street is that EDJ is forming a higher net worth division, that is why all the EDJ brokers are getting there series 66. Maybe once they are set up, they will be like MS higher net worth division, but probably better
[/quote]

Yes you certainly are.  You are not aware that Morgan Stanley is pretty much on par with Goldman Sachs?  Maybe their 'retail' division is not as prestigious, but that is because it was Dean Witter.  Morgan Stanley PWM is old line Morgan Stanley all the way and every bit as prestigious as Goldman Sachs, albeit the Dean Witter/Discover merger and controversy of the last few years (including bad moves from Phil Purcell) has done some damage.

Maybe you are not understanding that Morgan's PWM is still a seperate business unit (although they are trying to merge Dean Witter with PWM) and is kept very segregated from the Dean Witter side.

[quote=rook4123]I disagree, nobody with any real money would buy anything from some fast talking jerk on the phone. I have no doubt that they made money and ripped some people off. However, big transactions aren't easy like that unless you are their broker already or you have established  rapport of some sort. Normally this means meeting them or at least seeing what they look like. Newsflash, generally your HNW individuals are very well educated and have worldly sense. Getting some dumbass to buy $5k of stock b/c your a slick talker is one thing, but presenting and convincing a real whale to hand over his money is something else. The biggest misconception about sales ability is that you have to be slick or smooth and have just the right things to say at the right time. The real successful sales people in any industry work their ass off, and have good rapport with the client.
Now, if you put those guys against GS guys in a used car lot, it would be a much different story, boiler room guys all the way

-Also I would like to say, I don't know a fair amount, and I can admit when I'm wrong, and I'm still learning a good amount as well, but having said that I also know when I'm right!
[/quote]

Disagree all you want.  I'll take San Fran's words (and other experienced contributors to boot) and my experiences over your hypothosizing any day.  The name is just a brand that has been built and ultimately relies on the sales ability of it's sales force.  The boiler rooms took their lines/scripts from Lehman Brothers, which has built a pretty reputable HNW business off the techniques you are critical of.

I'd rather look to guys like Martin Shafiroff over nobody's like you (and me) any day as to what is a successful approach or not.  It's my understanding that he made the Lehman system...he's the biggest broker there is bro.

whatever you say bro

[quote=rook4123]whatever you say bro [/quote]

Remember, you're the one who claimed that HNW's wouldn't buy something over the phone from someone they have not personally met or seen yet.

Well, that's exaclty how Martin Shafiroff built his 10 BILLION dollar book!  Not to mention the 10's of thousands of other successful brokers who have done it.

Just because you can't do it doesn't mean others can't.

You should also know that cold calling HNW executives is how many Goldman Sachs brokers still get clients.  This approach requires a good brand behind it though...like Goldman of course.

[quote=rook4123]I disagree, nobody with any real money would buy anything from some fast talking jerk on the phone. I have no doubt that they made money and ripped some people off. However, big transactions aren't easy like that unless you are their broker already or you have established  rapport of some sort. Normally this means meeting them or at least seeing what they look like. Newsflash, generally your HNW individuals are very well educated and have worldly sense. Getting some dumbass to buy $5k of stock b/c your a slick talker is one thing, but presenting and convincing a real whale to hand over his money is something else. The biggest misconception about sales ability is that you have to be slick or smooth and have just the right things to say at the right time. The real successful sales people in any industry work their ass off, and have good rapport with the client.
Now, if you put those guys against GS guys in a used car lot, it would be a much different story, boiler room guys all the way

-Also I would like to say, I don't know a fair amount, and I can admit when I'm wrong, and I'm still learning a good amount as well, but having said that I also know when I'm right!
[/quote]

I think the biggest misconception is that people with a lot of money are somehow immune to persuasion or are fundamentally different from mere mortals.

You hit the nail on the head, dude!

How many times have we heard of rich people being scammed by smooth talkers?

The point is, yes, GS PWM is very very good.  However, for some
reason everyone acts as if they are the supreme being in wealth
management.  MS is just as good and just as competitive with these
guys.  

Dude

Don’t worry I can and I will do it.

[quote=rook4123]I disagree, nobody with any real money would buy anything from some fast talking jerk on the phone. [/quote]

I tend to agree with that statement however, is the object to sell something over the phone or is it to just get an appointment to discuss the services offered?  This Friday I will be smiling and dialing for the first time in my life.  While I will be pitching CDs that have a great introductory APY, my goal is simply to get an appointment to sit down with the prospects.<?:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

--WM

WM,

I believe you are with ML, so you should talk about the FNMA Step Ups or Tax Free Money Markets we have. PM me for more details if you'd like...

Thank you finally a little support

Rook,

You're getting support from someone who hasn't even cold called yet!!! 

I'd bet that most all of the truly successful brokers on this board built a good portion of their books with a slick pitch to those super elite super smart/above persuasion wealthy types over the phone.

WealthManager is an articulate, informed, well educated rookie and has value to contribute.  I'm not too sure that he carries the experience that is meaningful for the validation of your position though.

I read something today about MS PWM Division, I hold it in higher
regard than I did before, but it is still not Goldman Sachs. Dude, I
hope you realize this is all opinion, and there is no right answer.
Nothing can convince me that there is a better firm than Goldman, thats
just how I feel. And if a smart broker has great selling skills than
more power to him, but here again it takes a lot more than a few catchy
comments to get the big money, even I know this. However, I can see if
the prospect knows who you are and all that, and when you first talk to
them you are smooth than the big money could hit, but them not knowing
you at all, get real.

Before Morgan had all the controversy they were king of the hill bro....10 years ago you might have thought differently than you do today. 

If I was fortunate enough to be able to work for either of these firms, I'd go for Goldman first, Morgan (PWM) second personally.

Never the less, Morgan PWM and Goldman are equal competitors and I know of a couple scenarios where Morgan beat out Goldman for Billion dollar portfolios. 

Morgan Stanley (the old line company/investment bank) is every bit as cache as Goldman Sachs, although Goldman is leaner, more innovative and scrappier than Morgan in my opinion.  Since the merger and Phil Purcell's idiocy, Morgan has stalled while Goldman has excelled.  With Mack back, I expect the next 5 to 10 years to be a bit different.