So a few weeks ago an internal presentation about the working
conditions at Goldman Sachs was leaked and honestly when I first saw it on
Instagram, I thought it was fake But nope- it's all real and since then
Goldman has been making headlines for all the wrong reasons
What is up everyone my name is Ben, I'm a former J.P. Morgan investment banking
analyst and welcome to rareliquid the best channel for tech investing
Just to warn you in advance you might be seeing this little guy
running around throughout the videos. I'm at my friend's place in northern
California You want to learn about Goldman? Want to
learn about Goldman Sachs Milo? Oh he's so cute look at him
Alright so going back to the topic at hand, what I'm going to be doing is going
through the 11 slides of the internal presentation
and rating each part as either Misleading,
Somewhat Believable, or Seems Legit. I'll be basing my ratings from my experience
from working as an investment banking analyst at J.P. Morgan and to do a bit of
extra research, I also called two friends One who formerly worked at Goldman and
one who currently does work at the firm. I also previously made
a video on why I left investment banking and what a day in the life of an
investment banker is like, so feel free to check those videos out
Let me first start by providing you with some context behind the presentation
Overall I would rank the presentation as Seems Legit but a bit misleading in that
what's in the presentation is not what life is like for every investment banker,
whether they work at Goldman, JPM or any other bank
But before I go through the slides there are five important things that you need
to know which I really mostly gathered from my Goldman friends
First I was told that the slides were put together by analysts in the tech
media and telecom or TMT group and that group in Goldman is just known
to have one of the most intense cultures because of the group's deal flow
Deal flow refers to the number of transaction a group gets and good deal
flow just means that a group is constantly being selected by
clients to work on transactions Good deal flow, overall, is really a good
thing for both the company and analysts because it means that you'll be
working on more interesting projects, but it also means that you're going to
be working a lot harder than let's say if you're working for a group that
doesn't really have good deal flow is constantly pitching
to clients to win deals. Second, another important piece of context is that the
market has been incredibly hot over the past six to 12 months,
and whenever the markets are hot as they have been for tech companies and just
equities in general, it just means that there are more
clients wanting to go public or do M&A deals-
it just means a ton of more transaction and activity. So what this just means is
that an already crazy busy Goldman TMT group
is going to be even crazier because of all the hot activity happening in the
market Third, Covid-19 has resulted in less
boundaries between work and home. Having spoken with several of
my friends who work in banking right now, they feel like as a whole in general
they work more hours than pre-Covid, just because they're always expected to
be on call Banking has a super unique and honestly
kind of terrible culture where you're always expected to be on call like a
doctor, except that instead of saving lives
you're pretty much being called on to update presentations and fix excel
models So imagine as a doctor if you were
previously on call and you were out and about and usually were just called into
the hospital, now imagine you actually just live in
the hospital and you're always being asked to do things and that's basically
how analysts are working right now at home. The fourth important piece of
context is that there has been a ton of turnover within the SF TMT group. I've
been told that an abnormally high number of second year analysts and first-year
analysts have already left the group, which just means that there's more work
for the remaining first-year analysts to do
I don't know what the exact numbers are but basically the approximation I got is
that if there should be around 30 total analysts right now in the
GS TMT group in SF, then there's only actually about 20.
So imagine if you were working on a school project or work related project
and there's only three of you guys on a team,
and one person just leaves, and the remaining two of you have to take on
that additional work, that's pretty much what's happening at
Goldman right now. The fifth important piece of context that you need
to know is that this presentation was made by first year analysts
First year analysts work a lot harder than second-year analysts because
honestly they're just less efficient and care a whole lot more
Second-year analysts know how to manage their time better, they probably already
have jobs lined up, and they already have established
reputations, meaning that they're able to kind of pick and choose their projects
more and the team is willing to give them better projects and so that
just means that you're not as busy as you would be
in your first year compared to your second year. So
to sum up here's the context behind everything that's happening. Currently
Goldman is constantly the number one or two bank
for tech, and so that means they get a ton of deals normally
With the past years tech boom-this has resulted in an abnormally high number of
deals In addition to this, Covid-19 has
resulted in a more non-stop work culture where there is absolutely no boundary
between work and home There has also been a large turnover in
both first year and second year analysts leaving, which has resulted in a lot more
work being spread across less people And lastly, first-year analysts who are
the hardest working investment bankers are the ones who made these slides
So this crazy hurricane of factors is really what sets the context of the
slides I'm about to show you and in my opinion they're not really
representative of what banking is like for everyone
in the industry all the time-it's just the context I think
is helpful for you to understand why the numbers and figures you're about to see
are the are what they are. Alright with that said let's go through the
presentation here we see that analysts are working on
average 95 hours a week and sleeping 5 hours per night, and I'd rate this entire
slide as somewhat believable but also a tiny bit misleading. From my own
experience there were many weeks where it works 90 to 100 hours, but I would say
that was more on the abnormal end and typically I worked closer to 70-80 hours
even when my group had really good deal flow. My
friends who worked at Goldman also mentioned that sleeping five hours a
night is probably happening right now just because things are so crazy
but also not really representative of their experiences either
I also asked my friends what a good day, normal day, and bad day was like, and they
mentioned that a good day was around 8 pm,
normal day was around 11 p.m, and bad day it was around 4 am, which was similar to
my own experience and so that's why I think that
the slide is a little bit misleading right now. I also learned from my friends
that Goldman has been moving analysts from other teams to the TMT group which
I've never seen happen at JPM, and really just goes to show how crazy
things probably are at Goldman right now. But to also kind of balance that
perspective I also would bet that the analysts are including hours when
they're taking breaks, or doing laundry, eating at home because
technically they're still on call and working so I would assume that the
numbers are just a little bit inflated. So overall I think the hours
are a representation of the past few months and from a subset of first-year
Goldman analysts who are getting worked harder than anyone else on Wall Street
in a very abnormal Covid environment, which makes this slide believable but
slightly misleading On the next slide analysts say that if
working conditions don't change most are unlikely to stay at Goldman and
I rate this as Seems Legit When everyone is getting worked hard and
you're at the office at least you can kind of commiserate with your colleagues
staying up until like 2am, 3am going on random 7/11
runs or ordering food together, but when you're
just at home working all day I can imagine that people are probably
just trying to leave Goldman as quickly as they can and move on to other
jobs. So I would assume that most analysts probably do want to leave but
that doesn't necessarily mean that they're going to be able to
Analysts stay in banking for two years because most of them
want to go into the buy side meaning private equity firms or hedge funds
and if they want to do that in their contract, it's required for them to stay
for two years because then they're able to get a lot of repetitions
with presentation building and models and just doing a lot of due diligence on
companies and those kind of buy-side firms want
analysts to stay within those two years at the firm so
that they get all that training before they move on to the next job
So going back to the slide, I do think analysts who are currently stuck in the
current rut all probably will want to quit in the
next few months so that's legit but I don't think that necessarily means
that they all will even if nothing changes
This is a good segue way to the next slide, which is regarding physical and mental
health, and I would rate this slide as Seems Legit
The analysts reported huge decreases in their mental and physical health
and I'm not surprised by the numbers at all what you just kind of have to keep
in mind is that these first year analysts at Goldman are just
less than a year removed from their senior year in college when
they pretty much had the best possible finance job lined up and we're probably
just honestly partying it up their last few months or year in college
Compare that to now when they're always glued to their screens, have to check
their emails every few minutes, literally have to cancel
so many plans with their friends and family, and barely have any free time for
themselves, can't really get much sleep, yeah it's
really no wonder why the mental and physical health is going from
an eight or something when you're first entering the job to down to a two
or three With all this said, I do think that it is
a bit surprising that the average rating for everyone is so low because
I do think that in general not everyone's physical and mental health is
super great during banking but personally for me
I never felt like mine was typically below a five or six
usually it was actually in like the sevens or sometimes eight
because my group had a pretty good culture and so I would say that this
seems a little bit abnormal probably makes sense given all the context
surrounding the group at Goldman right now. For the
next few slides I'm going to be rating each pie chart individually
First relationships with family and friends were definitely negatively
impacted during my time at banking so this totally seems legit
At work we would always joke around that we see each other more than
we saw our family, friends, boy friends girl friends all combined, and there were
so many times where I would just be at the park hanging out
with my friends and I would get an email which meant that I had to go straight
back to the office or home and there were so many
plans that I just had to cancel on friends which you know honestly wasn't
great for relationships and so this totally makes sense to me
Second do you believe that you've been a victim of workplace abuse- I would rate
this as Somewhat Believable As with any work setting there can be
some really bad apples with associates VPs or directors who are just really
power hungry or condescending So I think it's possible that a lot of
these analysts may feel like they've been abused probably by some bad
co-worker that they might have or someone above them, but I do think that
in general and even from speaking with my Goldman friends
they kind of agreed to this that there isn't that much abuse in banking because
HR violations are actually taken very very seriously
Third have you sought therapy or additional help 75%
say yes, and I rate this as seems legit. I honestly don't really think that this
needs much discussion if these analysts are seeking additional help, then you
know I think that's actually great for their own mental health
and probably something that they are doing. Next up we have
unrealistic deadlines at 100% and this for sure seems legit
Based on normal standards, most banking deadlines are
unrealistic but bankers just work crazy hours to make them realistic and that's
just the honest truth A lot of times bosses and clients don't
even really want to make your life miserable, but for example, let's say they
want one slide updated that has old market data and they want
to refresh it for today's even though it's last week's and
to them, they don't know that what this really means is you have to manually
move around 50 different logos of different
companies and it might take a few hours and that's just one page
of a 50 page book, right? Things like that they
clients and directors don't really have a sense of how long things
take and so that's why these deadlines can just be completely unrealistic
because so much work goes into these presentation materials
Second have you been shunned or ignored in meetings 92%
say yes and I'm going to give this as seems legit but misleading
as a first-year analyst you're not really ever expected and honestly don't
even want to be speaking in meetings because normally they're with CEOs and
CFOs or high-level VPs and you're honestly really just learning to do your
job and so I think it'd be an unnecessary pressure
really if you were expected to actually speak at meetings
Third, we have 50% of analysts saying that they received unwarranted,
invalid, or public criticism and I would rate this as seems legit
I actually think that most bankers are good team players so it makes sense that
there's a 50-50 split where probably half of the bankers are
actually with good teams and don't really see a lot of this
unwarranted criticism. But on the other half there may be some bad apples where
some associates, directors, or VPs are just
not really good at giving criticism well or maybe
overly public about it and I also do think maybe Covid might be a factor
where everyone is not together and are just working
remotely, and so there could be a ton of miscommunication
meaning that there could result a lot of unwarranted kind of criticism that
analysts feel are unfair Next is have you frequently experienced
blaming without justification 42% say yes and 58% say no
and I would rate this as seems legit for the similar reasons as the previous pie
chart Next is have you frequently experienced
shouting or swearing and 17% say yes and I would rate this as seems
legit but slightly misleading Banking used to have a pretty rough
culture where there probably was way more shouting and screaming but
nowadays it's relatively tame compared to the past
Personally for me, I never experienced any shouting or
swearing directed at me at least and also the Goldman friends that I talked
to said that they never experienced it
either. Next we have have you frequently experienced excessive monitoring or
micromanagement 83% say yes and I would say this seems legit
Honestly I'm surprised this number isn't 100%
not to say that all associates or directors who are working
with analysts are bad but there's just so many times when you work with
directors and whatnot and they just require so much from you and kind of
micromanage everything you do so I am surprised that this number isn't at
100%. The next slide is analyst satisfaction and I would rate this
entire slide as Somewhat Believable for all the reasons I gave in the
context behind the presentation earlier on in this video, I think it's
pretty clear why these analysts feel so dissatisfied with Goldman and their
work life and their personal lives but with that said I think it's
important to note that you're still working at one of the best firms in the
world I can't imagine that if you were to ask
all these analysts, hey, if you could go back in time would you work
at a no name bank or some other kind of industry where you weren't
given as great exit opportunities or good compensation
I think the vast majority of analysts still probably would want to
go through the same experience to get this as
just really a springboard for their entire career-it's just right now is
probably like the hardest for them to even
admit and say that you know this has been a good experience at all
And I know this sounds like I'm probably trying to defend the firm and honestly I
really don't care about Goldman it's just that I've spoken with so many
analysts and just bankers over the past few years
and all of them really say the same thing
which is just that it was a really tough time back then but I'm pretty grateful
for how my career has evolved over time because of that experience and
I have a feeling that a lot of these analysts are probably going to feel the
same way For the next possible impact to GS slide
I would rate this as somewhat believable For the first two here, the first is
asking if you would recommend your team to work with Goldman
and the second is asking if you would recommend Goldman as
a financial advisor, and because they work so hard and are so unhappy
I think these numbers are pretty low, but if you think about it wouldn't you want
to hire a company or team who is just going to work
like a mad dog honestly on whatever you ask them to do
and get you whatever you need to get done?
Like that probably means you would want to hire those kind of people
and so that's why I think these numbers are somewhat believable because
that's probably how the analysts feel but years from now I think they might
think differently In the last one here they're asking if
you would recommend GS as a place to work and this is a pretty low
at 4.2 and I think that this is also somewhat believable just because they
analysts are so unhappy and they probably would recommend
going to maybe like a Morgan Stanley or J.P. Morgan instead of Goldman,
but at the end of the day candidates are really just going to choose whatever
firm they really want to work at. The select analyst quotes I thought were
personally the most interesting out of everything
and you know they're quotes so i'm just going to rate this as seems legit
The first one I thought was the craziest this person has gone through foster care
but they argued that banking is worse There are probably a lot of issues with
anxiety because bankers are constantly required to
check their emails every few minutes and if they're always at home they're
probably non-stop working all the time, which
also explains to consistent 9 ams to 5 ams You can take a minute to read through
these and also leave a link down below in the description where you can
download the presentation if you'd like as well
For the recommendations in rectifying the situation, I'll just go through these
one by one For the first one, 80 hours per week
should be considered max capacity This probably just isn't gonna happen
and it's not realistic for banking unfortunately
CS work or probably just presentations where you're trying to win clients
should be appropriately de-prioritized versus live deal work
I think this is fair we'll see if Goldman actually can implement this
though For the next one client meetings
requiring materials should be scheduled at least one week in advance of the
meeting day-probably honestly just not gonna happen because banking is so
fast-paced For the next one teams should be
required to meet ASAP when a meeting is set
to align on content, timing, and capacity I think this one is really fair and
something that bankers should work towards. Next, for client
meetings, teams should be pencils down 12 hours before the meeting
I think that this one may be something that bankers should work towards as well
but probably a little bit unrealistic. Lastly
the Friday night 9 pm policy and Saturday policy need to be respected-
basically at goldman bankers are not expected to work after 9 pm Friday or
all of Saturday without a pre-approved exception, and from speaking with my
friends at Goldman they said that this is generally adhered to as much as
possible, and so I think this is a totally fair request
So next up let me just close off the video with some final thoughts about the
overall presentation Just to close, I think that overall the
entire presentation is very believable I'm sure that these analysts are pretty
much compared to almost any human being in
the world, just being worked harder than anyone else that they can
compare to and if you go through that kind of
experience then you probably are going to have
a ton of decrease in your mental health, physical health, you know, you're gonna
not really enjoy the life you live and so that's why this presentation came
about As a former banker who has worked the
kinds of hours you do see on the slides I do feel their pain and understand why
they have the issues with mental health and
physical health that they do and you know honestly I kind of feel bad
for them now that I'm not in banking anymore
at the same time you know it is what you kind of signed up for not necessarily
maybe working 100 hour weeks you know for
months on end-that seems pretty crazy to me and I
actually really hope that that's not what's happening. One last thing that may
be interesting to note is that my friend at Goldman told me that there
actually hasn't been much change or response
from Goldman management after the internal slides have been leaked out and
the press has been all over this presentation
there really has been almost no changes except like some
few internal emails saying that they're going to be working on changes. Hopefully
things change, but we'll see what happens and this
really wraps up the video, thank you as always so much for watching
hope to catch you in the next one. Thanks so much and peace out
Alright say bye Milo, bye bye
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