GS Analyst dies
Mod Note (Andy): Make sure to read the letter "A Son Never Dies" written by Sarvshreshth's father Sunil Gupta
Sarvshreshth Gupta dies at 22. Sarvshreshth was a tech investment banking analyst at GS. They haven't released the cause of death but it appears similar to the BAML London situation.
It's always sad seeing a young kid pass away. It's even shittier that he passed because of complications due to exhaustion from being overworked. The article states that he was up for two days before he passed. He even tried to quit work but decided to come back.
I wonder if this will lead to some new initiatives or force the banks to take their previous initiatives more seriously. The banks have to be taking some heat especially since this occurred right after the Moelis death.
I think most of us understand the demanding work schedule of becoming a banker, but what about the effects on your health and mental well-being? Personally, I doubt this will change my career path much but it is worth thinking over and being cognizant of.
Read the full article here: http://www.bloomberg.com/news/articles/2015-06-02/young-banker-struggle…
Edit better article found here: http://www.nytimes.com/2015/06/02/business/dealbook/reflections-on-stre…
This is tragic. RIP to him, and condolences to his family. I'm surprised this happened in their SF office. I thought west coast banking was supposed to be a bit "more laid back" than the east coast scene, even if it is GS TMT.
Terrible to see this happen. Condolences to his family.
Having spent time on both coasts, the difference in culture really isn't that great, especially if your group is nationwide as you'll likely spend a significant amount of time working with your east coast-based colleagues. In some regards working on the west coast is worse from a morale perspective as it's frequently dead out when you get out of the office (vs. NYC where folks are out until 3am every night of the week).
Working on the West Coast is also tough, at least in my job when I worked out there, because everyone starts working so early because they're partially timed to the East Coast and have calls with people on the East Coast. So even if I was at the office super late it was pretty much expected I'd be at the office between 7 and 8 and actually be working instead of staring off into the distance. I felt horrible for market guys who were at the office at 4 am. And although I worked out there a long time ago, it was more casual in the sense that suits and ties weren't really expected but the work and pressure was the same as any comparable position in NYC.
Horrible story on the GS kid.
The culture is a bit more laid back, but the hours certainly aren't. They still expect 80-100, given the year he joined. GS TMT SF handles >70% of the tech deals for the firm and given the activity in that sector, everyone was getting swamped. I imagine he was having it especially hard.
Terrible news, and especially unfortunate that his father pressured him to rejoin the firm. It is insane that people are literally being 'worked to death' in jobs that undergrads will climb over each other to get. I doubt this will dissuade the intense competition for banking jobs, but at the very least I hope both firms and employees start taking work-life balance and mental/physical health as seriously as making money.
'feel really bad for the family. I hope they can find a way to cope with this.. seems like the cause is still unknown. 'would be curious to see what the medical examiners find
can't help thinking that these banker deaths and suicides by foxconn workers in china may not be very different..
https://medium.com/@peace2015/a-son-never-dies-10cc101e1d3
His father wrote a pretty heartbreaking essay about it...
Edit: looks like it was recently deleted
Google cache of father's essay. Is this it, I'm having trouble posting the link.
Link
Fucking tragic. If anybody wants to read the medium piece a cached version is still available.
Fucking awful. Banks are going to need to reevaluate and rethink their new initiatives - they're going to be under a lot of scrutiny.
deleted
People are realizing you can get a more enjoyable job, paid better, work less hours, and not be shit on by the public working for Tech and hot startups. Its hard to convince people to chase the carrot on the stick when people are getting news about venture capital backed millionaires.
I really think all-nighters need to be limited. I know there's the pressure to please clients and do thing as fast as possible, but I'm also sure that the world economy will run just fine if analysts are allowed to sleep. Even the navy SEALs get to sleep some hours per day during boot camp, but the average banker is no where near as fit!
I feel really bad reading this story. But would anything really change? Unless in the future everyone in banks is hooked up to some health monitoring device that force them to rest if their fatigue levels are too high...might not be too far fetched of an idea...
The way that I've heard it explained is that the analyst is effectively filling the shoes of two people. A 40 hour work week multiplied by 2, equates to an 80 hour week.
If there are more analysts staffed on a single deal, then it's easier to for the guys and girls to get some rest. However, efficiency drops while costs increase.
JPM has a junior analyst position that consists of the same work as a regular analyst without the same total compensation, maybe this is an effort to reduce work-related stress and suicides. I may be wrong about this.
See - there is a problem with your argument. Of course the world economy etc will be fine if analysts sleep. But let's look at this problem from two angles (I'll keep it high level).
Client side angle - Dammit. More investment bankers? I guess we need some to run a process/look for M&A targets/raise capital etc etc. Let's call in a few guys we know/like or call them all in. Let's see how helpful they are and who is the most price competitive and/or can deliver the most and/or the fastest.
Banker side angle - Got to pitch for business, meet or beat revenue targets, look good from P/L and political standpoint. Super competitive business, which means fees are going down. I really have to play up my relationship with these guys and/or build some. Oh and I need to be able to deliver all kinds of potential analysis/potential value add that other guys might not (or deliver as much as they are...).. Oh plus its so competitive I bet that if I do it faster than the other guys I might be able to get an edge. Any edge matters. So who's doing the pitches/models nonstop? Not the MD..
So that's the thing. Bankers are literally fighting tooth and nail to get more business. This is a super competitive market. So why take the risk of doing less/being slower than the competition? There's not much upside in it, right?
Now this is an overly general post but I hope it illustrates the point I'm trying to make...
Point taken. I fully understand the competitive nature of banking. That is why things can only change if all the banks change the business culture...which is pretty much impossible.
You can read father's letter here: http://www.wallstreetoasis.com/forums/a-son-never-dies-by-sunil-gupta-m…
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Nothing in life is worth killing yourself over, correct. However, we can't see the demons inside anyone else's head, only our own. You also have no idea the external pressure the guy next to you might be under.
One of my closest friends from undergrad struggled through his first job out of college without anyone knowing he was spending 70 hours a week being the office bitch and another 30 hours going back and forth to Jersey taking care of an ailing mother and a sister continually having mental health issues and struggling to stay at the college he was paying for.
During one of my first internships I forgot my notebook in the auditorium after one of those sessions they make you all get together and listen to one of the division heads. On my way back a few minutes later, I literally crashed into one of the other guys as I yanked one of the doors open. He had all the extra bagels and mini packs of jelly and cream cheese condiments wrapped up individually in paper towels from the bathroom and was tucking them into his banker duffel. The guy had six younger siblings and cousins living with him during his internship because his aunt had passed away two months earlier and was the only adult relative in the States. He was remitting half his take-home pay to his parents, living in an outer borough to save on rent and have space to house his family, and still making it at work.
You're right that no one is living your life but you. At the same time, when you're under prolonged and elevated stress at work, even a life with no major external worries gets tough at times. It's easy to get stuck in a tunnel when you've spent more than one night that month tucked under your desk or on your MD's couch. You come home irritable and snappy; simple stuff that should bother no rational human being pisses you off unbelievably, even as you recognize in the moment that you're reacting unrealistically. You're just that worn out.
Your roommates, your family, kids in college posting on forums, hell, even kids who went through an internship that by luck of the draw was light in terms of stress or hours - they can't empathize because they haven't lived it, haven't been in the hole at 3:30am on a Thursday desperately simultaneously blinking at a computer screen yet wondering why all their ambitions and dreams about a fulfilling life feel so far out of reach.
I can't imagine going through it with diagnosed or undiagnosed mental health concerns.
Andrew Sorkin's NYT article has a few good comments in the 'NYT picks' and 'readers picks' from people who have lived through it. There's nothing unfair to Goldman; the nature of the industry is very simple.
Seniors over-promise to clients, do not manage expectations or inbound requests from clients, and do (on average) a terrible job of developing relationships with juniors. Your reputation and compensation as a junior is driven almost solely by the VPs (and to an extent, the Associates) who work with you. They view you as a churn-and-burn resource.
Perversely, good analysts end up getting the worst of it sometimes because their very efficiency and competence means they get the most demanding work at the worst times. Rufiolove's story on the "How to Save Your Weekend" thread a few years back comes to mind as a great example. (http://www.wallstreetoasis.com/comment/reply/184332/896858)
The asinine standard of whoever looks like they're working hardest must actually be working hardest needs to die. It never will though. There has to be a real market opportunity for a banking franchise where MDs have real conversations with their clients, proactively manage expectations, mentor their junior staff, promote from within to the fullest extent possible, and actively cull any deadweight.
You'd have analysts who are remarkably engaged, happy, and healthy, no laggards who get shit bonuses yet stick around through the full two (or, God forbid, three) year program and can't be staffed on anything, and clients who appreciate the honesty and level of engagement. I get that that's the whole premise behind boutiques, but it sure seems to happen rarely. The closest I think I've seen it at scale is Evercore.
In summary, it's stupid to say "Ridiculous" when reading about someone's suicide. None of us can know the pressure (external or internal) he endured; he fought the good fight and ultimately lost. Pray in whatever way you do for his family and those that loved him.
It actually does exist, albeit at a lot of mid-market Midwestern and Front-Range boutiques.
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You're a f*cking idiot
RIP
Another tragedy, RIP.
How much can the industry change without squeezing comp for guys and driving talent else where? On the other hand, how willing are banks to change the working hours? I have a buddy at one of the banks that made 'changes' to its analyst working hour policy. He told me he's slept on the floor of his MD's office three times in the last six months.
Too sad.
These IB analysts are way too understaffed and overworked all for the sake that shareholders can have higher margins SMH
It's not so much due to clients being "less demanding", but that a good regional boutique survives on a different business model. They don't thrive on cranking out huge numbers of deals but instead on building lasting relationships with clients who return repeatedly every time they need IB services. MM companies will commonly use the same boutique for every service from their IPO to eventual sale/merger and everything in between.
By contrast most BB firms use a transactional business model, where they seek to maximize the profit in any individual deal, loan, or trade(depending on the department). The expectation of a long term relationship is typically nonexistent so they act accordingly. I'm not sure it's a good thing for the industry long term, and you can thank Glass-Steagall for its prevalence(seems like an indirect connection on its face; it's anything but).
As a result of that long term relationships it's more beneficial to have a close coordination with clients, and to give them realistic expectations and solid work over the rush work that NYC tends to favor.
First this is tragic for all parties involved. I also feel for the parents who clearly wanted their son to succeed only to see them lose their son at the ripe age of 22.
With this being said I want to talk about something else. Rather than start a new thread I'll continue here (and I don't work in IB so excuse me) but the whole IB setup seems inefficient to me. With this being said do you folks who work in IB think there are ways to lessen the workload and make the M&A process that you handle more efficient?
What if instead of breakdowns by categories such as Natural Resources you have one big M&A group kind of like what Morgan Stanley does? This way you have the experts within a particular space embedded within the larger M&A group which I would assume makes it a bit easier to share workload and still get things done.
Also rather than leave it up to you to make grammatical edits on whatever pitch book or presentation you're making why not make it to where IB professionals solely responsible for the analytical aspects of the work and leave the nitty gritty, non-analytical work to some other group which is responsible for making these non-value added changes?
Just throwing an idea out there...
Any thoughts?
It always made me wonder when I hear stories about analysts churning out powerpoint and pitchbooks for what - $70,0000 plus bonus - when that was what our secretaries did for $25,000 a year? Granted, said secretaries can't model in excel, but it always seemed, again from the outside looking in, like a waste of brainpower. Brilliant ivy league grads acting as overworked financial secretaries.
I always wondered why many STEM fields aside from tech are unable to offer high enough salaries to compete with financial services. Does research and breakthrough development not generate that much? Or is it just not glamorous?
At the same time though, I don't know if it's fair to say financial services are a brain drain for brilliant kids. The quant/trading roles are (where I think the kids are much "sharper" and "intelligent" than other finance sectors). But many of the kids who do/aspire for IBD aren't exactly brilliant. You might be able to grab some kids from Getco and have them cure cancer, but I doubt if you went to Morgan Stanley's IB new analysts that they'd be able to help you. Some former VP or MD said that the students who are really pushing the upper bounds of intelligence are much more attracted to trading as it's more meritocratic, gives instantaneous feedback, and is less BS.
Long story short, I wouldn't say it's a waste of brainpower. To excel at anything for an extended period of time, you need the talent and the drive. You won't be solving issues in science and medicine if you're driven by money and image, so those kids who choose to do financial services over whatever groundbreaking engineering projects are hot these days aren't wasting their talents. They're going where they want to be and will maximize their utility over the long run.
This is already in effect: some banks are organized by coverage groups and some are organized by product groups. It really doesn't mitigate the intensity of the work hours.
There's a lot of factors that go into how long the work hours are, and given that existing efforts to make them better ends up achieving the opposite effect indicates it's certainly not a simple problem to resolve.
The fact is every single bank is going to have long work hours, so it's clearly unavoidable, which means any efforts on the banks' part to reduce the hours is going to have limited effectiveness. At that point it becomes the analysts' responsibilities to really understand what they're getting themselves into. So now who should bear more of the responsibility?
Completely agree with what you're saying. Formatting such as drafting an IM or a teaser takes a lot (!) of time. I definitely think a lot of the things that IB analysts do can be outsourced to graphic designers, transcriptionist etc. Ideally IB analysts should be left to only do valuation/modeling, i.e. skills that require some sort of knowledge/expertise in finance and accounting. This would make working hours much better, however the work would be allocated to a broader group of people and bare in mind that a lot of the things IB analysts do are confidential and could not be easily transferred to third parties.
Since the bonus is partly linked to your internal ranking (at least in Europe), I don't think it's a particularly great incentive structure, since ambitious analysts (and there are a ton of them) are always disincentivized to leave the office... I interned at a restructuring advisory group in Europe, and our top ranked analysts used to be walking around with 'red eyes' all the time. I think something can be done to optimize the incentive structure in IB to prevent future tragidies from happening.
Think it's time to put a cap on hours worked during a week.
Not very libertarian of you bro
The letter written by the father is heart-breaking.
It's absolutely nuts for people to work 100 hour weeks. Totally ridiculous.
Extremely sad. I haven't teared up at reading an article in a while. I'm going to go call my parents now.
This is just sad news all around.
As for schools, intelligence, banking, etc. it comes down to being able to cope and adapt as the tides/situations change. And they do.
The "book smarts" you need to excel in school oftentimes has little to do with the "street smarts" required in most careers, especially business careers. And the street smarts + technical knowledge you develop as an analyst/associate/VP doesn't correlate with the relationship skills needed to be a successful MD, partner, whatever.
The most invaluable talent is the talent to adapt and reinvent one's self. Virtually all great athletes, business leaders (Steve Jobs ver 2.0), artists, and orgs/businesses have had to draw on that talent of reinvention and adaptation to have any longevity.
As SpacemanSpiff said, we see it in so many team sports. The draft picks that do well in the pros are those who are able to do what it takes to adjust to a new game (the professional leagues), rather than expecting the game to adjust to them (which they've done their entire playing career up to that point). It's partly why it's so hard to draft well, because that trait is something you can't really spot in a combine or through a few meetings.
Very sad, but if anything, this will just increase interest in GS and IB in general.
GS pays bonuses on calendar year basis, thus people with PE offers quit in Jan/Feb - > remaining analysts gets destroyed until new class joins
This actually happened 6 weeks ago, before the Moelis death, it just came to light immediately following that story as it had similarities.
It should also be noted that the cause of death in the father's letter (suggests a tragically timed hit-and-run) differs a great deal from other sources. Most news sources have reported that SFPD believe it was a suicide, and Dealbook reported that he was found at 6:40am the following morning outside his apartment and had "apparently fallen from the building", no mention of a hit-and-run.
http://www.nytimes.com/2015/06/02/business/dealbook/reflections-on-stre… Either way, horribly sad and really puts things into perspective when things like this happen.
As someone who's worked in non-competitive entry level corporate jobs (back office), I can say that the people who make it to top-tier entry level business jobs (I-banking, Mgmt consulting) are pretty sharp, in comparison to other folks at more 'average' jobs.
I put in my 1 year at a tech consulting company (think Deloitte, Accenture, IBM, etc), since my GPA from college was crap and I couldn't score a front-office offer. Let me just say.. a lot of people I met at the job (including many senior level people) weren't bright at all. I mean, a lot of people I knew at the firm would struggle with 8th grade-level algebra. I couldn't believe it when the project manager that I worked for asked me if I knew how to calculate the percentage difference between last month's project team expenses from this month's expenses. I explained it to him, three times, to no avail. Then I met this girl at 'Senior Analyst' level who would struggle with the concept of 'V-Lookup' in Excel and fail to understand its use case, and would periodically shoot me an email to walk up to her station and teach her that 'complex topic'. After my 3rd trip to her work station, I told her "you should learn to use Google before Excel". After just working at this place for a year, I felt crushed and disoriented to be working with a bunch of morons with no brainpower, no ambition, and no drive.
Meanwhile, I met several folks from our firm's Management Consulting division (the place I worked at had both Mgmt consulting & tech consulting arms) and these folks were extremely sharp. I attended a target school and the people I knew who got into I-banking were also very driven and had pretty high raw intellect. (evident from high GPA's in rigorous majors) I-banking may not be rocket science, but to be good at it, you need decent analytics skills with great attention to detail. You wouldn't find these qualities very easily at say, a back office division of a bank, or the place I worked at. Now I work at a data analytics role at a different company. Here, it's a mixed bag: some smart people but lots of average people in terms of talent and drive.
One thing that ALL of you guys talking about the work burden in IB seem to be missing: insane hours and lean teams are a direct product of the banking culture. Without this "cultural" business model of lean teams and tough hours, compensation would go down...
It's as simple as that. The vast, vast majority of revenues an investment bank generates go to its employees. Like with any business model, an investment bank's goal is to minimize expenses and maximize revenue, with maximum efficiency and output per worker. If you increase the number of employees and decrease hours worked, the average all-in compensation for junior bankers takes a huuuge cut (probably >50% cut).
How many of you junior bankers would be willing to work as glorified accountants, working 50 hour weeks and getting paid $60k all-in? The culture and lifestyle of banking will not change, because of the huge barriers to entry, and because of the huge compensation. And when the culture and lifestyle do change, so too will the compensation, and it will no longer be an attractive industry.
As an aside, the guys cashing in on the huge year-end bonuses and then complaining about the lifestyle reminds me a little of football players who earn hundreds of millions throughout their careers and then complain/sue over physical ailments. It's occupational hazard, guys, and you knew it coming in when you signed on the dotted line...
All the big banks were able to collectively bump analyst salaries. They could use the same approach to place a cap on the maximum hours worked per week or per month. Reducing weekly hours to 90 per week will not reduce the pressure (and related stress) to perform, but at least employees will have time to recharge.
Or just implement JPM's junior analyst program across the street.
Banks take a small hit to profitability in order to continue attracting talent. Gives the IB staffers more metrics to manage.
I'd like to introduce another perspective to this, that the kid was very likely on a H1B work Visa and he couldn't quit his job. I was on a H1B in IBD too and I knew I had few options. That kid was born in India, did high school in India and only came to Penn for college, so I'll bet my money that he's on a H1B at GS. He's living the Indian version of the American Dream and if he quits his IBD job at GS, it's off to India he goes. His dad knows it, and he knows it, and daddy probably reminded him of that.
Although why didn't he request a transfer to elsewhere within GS is beyond me. He probably thinks he's the best of the best (Penn education, GS TMT) and couldn't settle for less?
I wonder what the point of your speculating is...
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