More negative press on Apollo

From Matt Levine this morning.  Does anyone have access to the full BI article?

Apollo

A few years back, there were a lot of stories about how the big investment banks were becoming nicer places to work. “Take the weekend off,” a lot of banks told their junior employees, “or at least, like, 36 contiguous hours off most weekends, from Friday night until Sunday morning, unless of course, you are on a live deal.” As a humanitarian and a lazy former investment banker, I thought these initiatives were nice, but they troubled me a bit. They do not fit the stereotype of how high finance works. The trade-off is supposed to be (1) you work all the time but (2) you get rich and become a master of the universe.

Of course, it was possible — quite reasonable, really — that today’s young people do not want that trade-off, and would prefer to have a more normal work-life balance while making a bit less money and mastering a bit less of the universe. But it was also possible that the real driving force behind the change was that the banks could no longer offer that trade. Banks were still hungover from the financial crisis, the regulation was crimping their ability to make a lot of money (and pay a lot of it to their people), and the tech industry was booming and seemed more lucrative and appealing to ambitious young people. The financial industry might have been constrained by outside circumstances to change its pitch to “come to investment banking, you won’t make a lot of money but at least you’ll get 36 hours off many weekends.” I don’t know that that’s a very good pitch!

You don’t read so many stories like that anymore. Instead, we talked the other day about how Goldman Sachs Group Inc. Chief Executive Officer David Solomon wants his bankers to spend more time in the office and stop going out for lunch. Rough for them, but honestly kind of a good sign? There are deals to be done! There is money to be made! Get back in there and make it! The old trade-offs are back; finance is once again where the action is, and if you want to be part of that action the only choice is to take way, way too much of it.

It’s not an investment bank, but this Insider story about private-equity giant Apollo Global Management Inc., whose “hard-driving culture is extreme even by Wall Street standards,” hits some of the same notes. It sounds terrible! 

Associates are often handed assignments by executives late in the day, with the expectation that they are to forgo a night's sleep to prepare materials for early the next morning. Associates assigned to support a deal could expect to live without a full night of rest for weeks on end. One source who recently left Apollo said they often felt drunk because of sleep deprivation. 

One executive made it known that he hadn't taken a personal trip until he was promoted to principal — a point that associates took to mean that they shouldn't either, according to one Apollo associate who heard the remarks firsthand.

This person, and an employee who left the firm recently said that associates have coped with the work stresses by relying on a dark sense of humor to get them through the day, joking about everything from the perceived incompetence of superiors to more extreme statements, like saying they would rather kill themselves than keep working.  

Apollo also has a part-of-the-weekend off rule — no calls or meetings between Friday evening and Saturday evening, “unless it is urgent or related to a live deal” — but it doesn’t seem to have done much good:

Associates told Insider that partners at the firm simply compensated for the communications hiatus by piling on extra work on Saturday night. Within a month, it seemed as though the mandated break had disappeared, said two associates, one of whom has since left.

And you get vacation time unless you don’t:

Three other current executives said that the firm encourages employees to take two weeks off in August and another two weeks off in December. Two of these executives acknowledged that associates often weren't actually granted this time in practice if they were pulled into a deal and that breaks, for anyone, had been hard to come by over the past year during the pandemic. 

It is all extremely unpleasant. Also, as a former investment banker, I found it all pretty familiar. It suggests the old trade-off is back: There are deals to be done, money to be made, a lot of action everywhere, so you have to work all the time. 

It’s possible that this is all cyclical: When financial firms are busy, they tell junior employees “sorry we can’t offer you weekends or sleep, but here is a pile of money”; when they are not, they tell junior employees “sorry we can’t offer you as much money as you expected, but here is a Saturday off.”

But you never know. Back when everyone was getting half a weekend off, there was a lot of talk about how today’s young people don’t want the old-school trade-off, that the industry would have to change permanently in order to accommodate the next generation’s demands for meaningful work and personal life. “Seven of the 30 private-equity associates in Apollo's New York City office, along with one principal, have left the firm over the past three months.” “Associates at the firm are also granted some of the highest pay packages in the industry,” and yet they’re leaving anyway. Perhaps, having had a glimpse of the weekend, they can’t go back to the old ways.