E91: John LeFevre of @GSElevator Joins the WSO Pod
About
In this episode, John LeFevre, author of Straight to Hell and popular twitter handle @GS Elevator joins the WSO pod to discuss his volatile career path. We learn about what initially drew him to Wall Street, why he left after a decade and what he's up to now with a variety of startups. I think John's path is a great reminder of some of the dangers young finance professionals face. The temptations, the drugs and the potential erosion of character in the chase for money is still something that is very much alive. Check out his latest entrepreneurial endeavors including thewhim.com which is a collection of interesting content around lifestyle, finance and travel and brummelco.com, a fashion startup he launched a few years ago.
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WSO Podcast (Episode 91) Transcript:
Patrick (CEO of WSO): [00:00:06] Hello and welcome. I'm Patrick Curtis. Your host and chief monkey, and this is the Wall Street Oasis podcast. Join me as I talk to some of the community's most successful and inspirational members to gain valuable insight into different career paths and life in general. Let's get to it. In this episode, John LeFevre, author of Straight to Hell and Popular Twitter Handle GPSs Elevator, joins the WCO pod to discuss his volatile career path. We learn about what initially drew him to Wall Street, why he left after a decade, and what he's up to now with a variety of startups. I think John's path is a great reminder of some of the dangers young finance professionals still face today. The temptations, the drugs, the potential erosion of character and the chase for money is still something that I think is very much alive and relevant. Also, check out his latest entrepreneurial endeavors, including the women, which is a collection of interesting content around lifestyle, finance and travel, and Brummel Coco, a fashion startup he launched a few years ago. Enjoy. All right, John, thanks so much for joining the Wall Street Voices podcast.
John LeFevre: [00:01:16] Thanks for having me. It's good to be here,
Patrick (CEO of WSO): [00:01:18] To be great. If you could just give the listeners a short summary of your bio for the ones that don't know who you are.
John LeFevre: [00:01:23] Sure. My name is John. I was an investment banker. I joined Salomon Brothers on the fixed income desk in 2001. So right after the dotcom bubble burst and I worked primarily in fixed income capital markets and on the syndicate desk in New York, London, Hong Kong and Singapore through the financial crisis, and then left the bulge bracket buy sell side and started a capital markets boutique in in Asia did that for a couple of years and then kind of got bored with the industry. And having always been somewhat cynical on Wall Street culture and having collected stories and notes from my experiences decide to shift over into the publishing world and wrote a book about Wall Street culture and kind of, along with it, set up a social media character gas elevator for the purposes of kind of promoting and building up a social media footprint in anticipation of my book Coming Out, which is now almost five years ago. The book was called Straight to Hell. It was broadly commercially successful. I think it debuted number seven on the New York Times bestseller list and was optioned by Paramount for a movie which is currently in development, although the script is objectively terrible. We can get into that. Get into that later. Ok, if you want. And then from there with faith, a gas elevator for a couple of years and got kind of bored with, you know, there's only so much you can say in terms of illuminating and satirizing Wall Street culture through the lens of the worst parts, the worst aspects of the culture in terms of the racism and the classism and the misogyny and the corruption and deviants and so decided to shift. Having at that point, you know, a million and a quarter followers across various social media channels shifted into more entrepreneurial initiatives. You know, obviously started a fashion line, looked at expanding or evolving the GSE elevator footprint into more of a kind of a media type entity and more recently been looking at kind of private equity and other opportunities that come my way. So it's also a short synopsis. I'm sure we can break those components.
Patrick (CEO of WSO): [00:03:39] It's one of the more interesting backgrounds we've had on here, so I'm excited to break down some of it and the podcast you just released, do you want to promote that or give it a little shout out right now?
John LeFevre: [00:03:49] Yeah, I mean, I think we can get into that a little bit more detail later on. But obviously it's all part of the evolution of gas elevator, which as a Twitter character, you're limited to 140 characters in character. And so I evolved beyond that and started writing longer form content for outlets like Business Insider and CNBC. You know, fashion guidance, business etiquette, how to get a job on Wall Street, why Wall Street is still a good place to start your career, general things like that. And it seemed to really resonate with a lot of people. And so most recently kind of evolved that into a podcast, which the idea really is that we have an eclectic group of guests across business leaders, influencers, political figures, things of that nature and just have general topical conversations on current events or, you know, lifestyle guidance or, you know, anything and everything, really.
Patrick (CEO of WSO): [00:04:46] That's awesome. So let's go all the way back. Let's it's interesting because you went to prep school, I went to Prep School, you went to Choate, I went to Andover, way back. We were actually in high school. About the same time was kind of Wall Street on your radar then like all the way back then? Or was it more once you were an undergrad?
John LeFevre: [00:05:03] Yeah, that's a that's a great question. Actually, I devoted an entire chapter to in my book to that exact topic, so I was probably a sophomore in high school when I read Liar's Poker and I thought, Man, you know, this is really, really intriguing. This is the direction I think I want to go in. And so, you know, I really knew that at age 14, and part of that stems from just looking around. Obviously, Choate is just outside of New Haven, which is, you know, forty five minutes from Greenwich, Connecticut. And so a lot of the the kids that I went to school with were sons and daughters of of Wall Street titans and financiers and people like that. So you know, you had Ivanka Trump and Brett Icon, who's Carl Icahn son, and you saw the Wall Street dads come to campus and their nice cars and the type of advice that they gave their kids, you know, a great piece of advice, which I kind of gleaned from them, which was kind of, you know, rules are for the obedience of fools and the guidance of wise men. So it was basically this mentality where you got to pick and choose which rules that that you chose to abide by.And so when we were when we were in prep school. When we were in prep school, you know, and we went to a party in New York City for the weekend and get crazy, we would just sign out to somebody's house in Greenwich because obviously, as you know from Andover, you know, the rules are pretty strict. And so it was always kind of the Wall Street dads that let us break the rules and, you know, squared with impunity and just seem to have the most fun. And so from there I thought, OK, I want to I want to go work on Wall Street and having read Liar's Poker, obviously, I said, OK, I want to. This time is kind of dotcom. Everybody wanted to go into equities and tech and IPO, and I said, Well, I just want to go join the bond desk at Salomon Brothers. And so that's what I did. I got an internship in London when I was in college on the Salomon Brothers floor, the same trading floor that where Liar's Poker took place and then everything kind of took off from there.
Patrick (CEO of WSO): [00:07:01] Do you feel like what about your background, your parents? Was it? Were they at all like, not happy about it? Where they encouraging, just supportive? What was what was that like?
John LeFevre: [00:07:11] Yeah, that's a bit a bit nuanced because on one hand, my dad ran the commodities desk at Merrill Lynch in the 1970s, but kind of retired early and decided to just throw everything behind and lead got so sick and tired of the industry and move to rural Texas. So I grew up in a small town about an hour north of of Houston, and it couldn't be any farther from from Wall Street. So on one hand, I had the natural connection there. But on the other hand, you know, when I when I got when I showed up to Choate, you know, for boarding school, I was just some rural kid from Texas.
Patrick (CEO of WSO): [00:07:50] Do you feel like a little bit of your path? It's kind of like your dad's almost in a way where you started and then you basically did a complete complete 180 and change. Do you do you ever do you realize that or do you do you acknowledge it
John LeFevre: [00:08:04] In a way? My path kind of mirrors mirrored his and that, you know, I spent a dozen years fully entrenched in the culture and in the industry and then reached a certain point, you know, 2012, 2013, where I just got really, really sick and tired of the industry and the culture, and I wanted to just go completely to the the other end of the spectrum. I mean, it was like a pendulum that just swung them. And, you know, I lived it day and night for so many years that I just got really burned out.
Patrick (CEO of WSO): [00:08:31] Yeah. So let's talk a little bit about just that. So you're in, you're in college. You know, you kind of the initial interest is in sounds like in high school given given kind of your peers and all the cool Wall Street dads calling. And so you're basically an undergrad and you know what you want to do from day one, you're you're getting me right, internships, you're doing all that stuff. Was there any kind of stumble or like in terms of interviewing or anything like that? Did you feel like you were ready or?
John LeFevre: [00:09:01] No, and I've written about this cynically when I've written about kind of how to get a job on Wall Street, how to ace the interview or how to excel in your internship, which we can flesh out some of the content from those articles. But really, it was, I don't know, not to sound arrogant, but it was a it was an exceptionally easy path. And I'll qualify that statement by saying it was easy in the sense that, you know, freshman year after freshman year of college. You know, I through a family connection, I got an internship at a futures and options boutique in London. And so if you think about it for most college kids, not a lot of them have the ability just to fly to London for the summer and not worry about budget constraints or applying for serious internships. As a freshman or sophomore in college, I mean, I remember that wasn't even really my first choice. I thought, OK, well, I'll just go work for Lehman Brothers or Bear Stearns, which kind of dates me, I guess significantly. But you know, they're the feedback I always got as a freshmen. Sophomores know you. You can't get these internships unless you're a junior. And so I kind of went the alternative route. But fortunately, I had the means and resources to do it. The same with kind of sophomore year. I went and worked for a kind of a startup in a finance orientated startup in New York City. Same kind of deal. And then by the time Junior came around and I was applying for a job at Salomon Brothers, I had, I think, a pretty decent resume compared to a lot of the other other juniors. And so I got the job rather quickly on my own merit and then received an offer at the end of my internship and just coasted through senior year and never had to really interview for another job after that.
Patrick (CEO of WSO): [00:10:45] So you kind of, I think partially the connections, partially knowing what you wanted early helped you and partially being able to afford the trips to the internships out to London. Those all played a role, it sounds like.
John LeFevre: [00:10:58] Yeah, absolutely. To which I say that because I'm not trying to take credit for all of my accomplishments. I mean, clearly, I came in at a higher level than most people have the ability to, and I was fortunate in that sense.
Patrick (CEO of WSO): [00:11:12] So certainly that's fair. I think we're all we're all starting off. I was very fortunate as well. So, you know, I don't I think it's it's very natural. If you have your eyes wide open, you're being truly honest with yourself. I think it's good to realize, yes, you worked hard. But also there was
John LeFevre: [00:11:27] And I certainly reflected, I mean, when we started, when I left Solomon or Citigroup then and we started a boutique firm, you know, we hired 45 people in six months. And to do that, you know, interviewed probably five hundred people. And so I certainly have a certain self-awareness in terms of, I think, what? Where I was given a head start and what it would take if I hadn't been afforded that head start in terms of kind of networking, in terms of preparing, in terms of focusing your academic studies, I mean, even when I was early in my college years, I was taking classes on options and equity valuations, fixed income securities and things like that. And so that when I got into the interview stage, I was exceptionally well prepared to the extent that even when I was being interviewed by first and second year analysts, I think in some cases I felt more knowledgeable on certain topics as it related to fixed income securities or equity valuation than perhaps even even they were.
Patrick (CEO of WSO): [00:12:24] Any tips for listeners on how to kind of be that well versed? Besides books and just reading as much as they can?
John LeFevre: [00:12:30] Well, I think you have to be passionate about it. I mean, if you I mean, I enjoyed, you know, the space for for so long. I was exceptionally passionate about it. And so the advice I had for for kids now really is, you know, figure out if you are passionate about it. So try and read through the Febos Fixed Income Securities book, which is a nightmare to get through, you know, study for your CFA while you're in college. You know, most college libraries have Bloomberg terminals. Bloomberg offers free tutorials on how to use them. Get well versed on Bloomberg. I mean, those are pretty easy things to do. You know, network with older students in the finance clubs and the business clubs, you know, look at what they're what they achieve in terms of where they get placed at. Firms replicate the path that they took, stay connected with them. And then one of the things which I always point back to is as one of my biggest regrets is it's just networking, because even though I kind of coasted to some extent, even when I got to Asia, I was on the fixing of syndicate desk, which for people who don't really aren't really familiar with that world you were, you kind of straddle the sell side. So the investment bankers and their corporate clients and the buy side. So sales and trading and their buy side clients or the investors, hedge funds, active managers.And so you sit above the Chinese wall and you work right in the middle. So you have the perfect vantage point to kind of have all knowing access to everything that's going on with the bank and to the extent that you do kind of public deals. Typically, you're not a sole bookrunner on on most transactions. And so you're doing deals with three or four or five banks. So you're doing deals with every, every bank on Wall Street. And it is in terms of the allocation process is a global process. So you're working with colleagues in New York, London, Asia, irrespective of where you're sitting. And so that gave me exceptional access and exceptional credible vantage point from which to opine on on the culture. I think the the frequent refrain that you hear in terms of pushback from kind of Wall Street apologists is that there are always a few bad apples as it relates to deviance and corruption. And I think from my experience, it was, was was was quite the the opposite. But is that related to your question in terms of what would be good, valuable advice for for people? And certainly if I could go back in time would be just network like crazy. And so one of my biggest mistakes, I remember I would do these roadshows and with my New York colleagues and U.S. colleagues in Asia, and we'd have, you know, 40 investors at a launch and 20 bankers and 10 kind of CFO, CEO level clients and you go around exchanging business cards.You know, I was, I guess, a little cocky. And when I walked out of those roadshow luncheons, I would just drop 40 business cards in the trash can. And these are all people now who have dispersed all over the globe in a variety of industries with varying degrees of success. Their corporate executives, their tech startup founders, they're involved in politics and policymaking, or they're senior at banks all over the world. And I never really fostered those relationships. So you can. It's important to network, even if you're an analyst or an associate going all the way up. But if you're a college student, I think it's important to network with the people that you envy two or three years ahead of you and treat them as seek out them as mentors follow their trajectory, emulate what they have done to achieve their success and stay in touch with them, I think is fundamentally important. And it's if you're not at a target school, it can make all the difference in the world. I mean, I wasn't at a target school and I had a leg up, but I think that mentality is what got got me in the door because certainly the big banks were not coming to Babson College to to recruit kids like me. We had to go out there and find it.
Patrick (CEO of WSO): [00:16:20] That's fair. Yeah, I think I think that's a that's a pattern we hear just consistently on this show is just like I wish I had networked more. I wish I had been in touch. I had realized how, you know, that one can actually make such a dramatic difference. And so that's that's great to hear. So tell me a little bit about you. Were it took a while for you to actually leave, right? So you you said you got like you were a trader for a while. You were on the. Ask you kind of were it sounds like you started partying in high school pretty hard. You probably partied through college. You kind of extended that through into into your first few years. Wall Street. You know, I partied hard, but not necessarily as hard as you did. From what I've read,
John LeFevre: [00:17:01] Asia, Asia is a completely different animal. Anything, anything goes in ages. So, you know, the first day I arrived in Hong Kong on the syndicate desk in that capacity. Your deals are by nature, emerging market, largely high yield deals outside of Korea, Philippines, Indonesia, China. They're all high yield credits. The head of hedge fund sales desk handed me the number of just a number. I said, What the hell is this? It's it's the are drug dealers. No, you're going to need it. And the philosophy, I mean, we would, you know, if there was a big bond deal where it was eight, 10 times oversubscribed, we'd get calls from hedge funds taking us out, taking us on trips. And it was, you know, quid pro quo where the next day when we were allocating deals that they could just flip for an immediate profit, even if they didn't have any interest in the deal was that they showed us a good time. We hooked them up on hot deals. Alternatively, if I had a private placement that I was this close to getting over the finish line, I could call a few hedge funds who I thought, you know, owed me favors and calling those favors. Or I could go out and take them out or take them on trips or send them stuff. I mean, it's just it was wild less. I mean, I remember competing for deals in Indonesia, and the head of capital markets at Deutsche Bank sent an analyst with a crocodile Hermes Birkin bag to hand-deliver it to the. It was an Indonesian tycoon. Hand-deliver it to his wife in exchange for get it for Deutsche Bank, getting a high yield mandate that generated $6 million in fees. So that type of stuff just happened all the time and happened still in the emerging markets in particular in terms of the the inherent conflicts of interest and the kind of corruption that took place in the application process.
Patrick (CEO of WSO): [00:18:48] I feel like, well, yeah, it sounds like a little more wild wild west, but I'm sure it happens even here in the US. I mean, oh
John LeFevre: [00:18:54] Yeah, absolutely.
Patrick (CEO of WSO): [00:18:55] Maybe not to the extent, but
John LeFevre: [00:18:58] You know, I would have I would have hedge fund guys. They would find out a deal was, you know, 20 times oversubscribed. And people talk think that it's some great, sophisticated universe of hedge funds. But these guys would call up and say, Hey, you know, I'm really interested in this Megatron deal. South Korean telecom company, yeah, you know, put me in for 20 million and I would say, Megatron, you mean Magna Chip, you know, they wouldn't even know the name of the deal, but they just heard that it was 10 times oversubscribed and they know it's all. We owe them a favor and they wanted. They wanted 20 million bonds. I mean, that's how the allocation process happened. And it still does. I mean, you can't take those complex interests out of the the allocation process because bankers have full discretion and they have to weigh in the the broader interests of the firm, their next few deals or relationships that that other groups within the firm might have with them and foster those relationships on both the buy side and the sell side.
Patrick (CEO of WSO): [00:19:50] So does that actually wear on you or is it just a block? Was it a lot of fun? I mean, it was always probably a lot of fun while you're going through it. But did it wear on you or was it more like, I just want to do something different? Is that in terms of why you broke away?
John LeFevre: [00:20:00] Yeah. I mean, I think it broke away for a couple of reasons. One, after the crisis, it just got a lot harder to get deals done. And it just wasn't. It wasn't as fun anymore. And so I'd always said, you know, everyone has a bad day or a bad week or a bad month. But as soon as you start having more bad days than good over a long period of time, it's probably time to go and do something else, I think. The other thing about it, especially being in Hong Kong and Singapore, is it still is a little bit of, you know, of a soulless existence, right? So it's like you see bonds, sell bonds, repeat, you know, go out and party all night, wake up at six o'clock in the morning through the whole thing over again and spend your weekends sitting by the pool, drinking cocktails. After a while, you realize that that's no real way to live a life. And so to our earlier point about that kind of pendulum shift, I was sitting there in Asia just having so, you know, I started the boutique and then kind of had a falling out with the partners there that I work on.
Patrick (CEO of WSO): [00:21:01] How long were you at the settlement?
John LeFevre: [00:21:04] A couple of years, right? So yeah, I was there from 2000 to 2010, and then I left with my boss in Hong Kong and my boss from London, and we set up a boutique capital markets firm that the idea there was that post-crisis, the banks were stepping back from a lot of the kind of SME clients who needed covering because, you know, you can do a Republic of Korea or Indonesian sovereign deal in a day and a half. But if you're trying to do a private placement, you know, $50 million, $100 million private placement for a Chinese company or Indonesian corporate that takes six months to gestate and may or may not even happen, depending on what market conditions look like six months for. Now they decided not to engage in any of that business, so we all saw an opportunity there. And then a year later, which probably gets a little bit too complicated for this podcast, but I was poached away by Goldman Sachs to run their syndicate desk, which incidentally turned out to be the death that would go on to do the one bead deal. So it was probably a good thing that I wasn't there. I probably would be dead or in jail. But, you know, a month after I signed the I had such a bad falling out when I left the boutique firm that I helped start that they tried to enforce the non-compete clause in my contract, which kept me out of the market for a year over that non-compete. And at that point, you know, to what we discussed about it being kind of a soulless existence, I said, you know, there's more life than this, and I just kind of having had roots in Houston, I kind
Patrick (CEO of WSO): [00:22:37] Of you went for a while, though, I mean, almost 10 years.
John LeFevre: [00:22:40] Right? Yeah. Well, yeah. Ten years at Solomon and then a year and a half at the boutique and then a year a year contractually obligated to sit out of the market.
Patrick (CEO of WSO): [00:22:49] And then I recoup. I mean, obviously there's there's substance abuse and stuff like that to help you keep going. But like it did, it was there, like when you're at the pool trying to, like, recoup on the weekends.
John LeFevre: [00:23:01] Is that you just drink, you drink all day and go get a two hour massage, I mean, that's so cute.
Patrick (CEO of WSO): [00:23:06] Yeah, you got to sleep a lot too, right? You got to sleep sometime, right? Did you feel like you were going to burn out or like, have a heart attack or something at some point at like thirty five?
John LeFevre: [00:23:15] We definitely saw that. I mean, I didn't know this at the time, but you know, the guy that I was replacing when I got sent to Hong Kong was a little bit older than me, and he was kind of this perfect play, played tennis in college, went to Goldman Sachs and Morgan Stanley, and then over to Solomon, ran the hedge fund desk in in Asia and had the apartment on Central Park West and the The Beach House in the Hamptons and gets out to Hong Kong and just goes crazy with the drugs and the women, and ends up fracturing his marriage and has to move back to New York. So you definitely saw the burnout. But for me, I mean, I I never really saw that. I just got personally sick of it. I mean, I guess that's a sort of burnout, but I never really felt the kind of physical, physical fatigue.
Patrick (CEO of WSO): [00:24:00] So tell me you're kind of thinking once once that non-compete is in force, is this kind of when you start thinking, Hey, maybe I want to do a book? Or when when does that start? Kind of.
John LeFevre: [00:24:09] Yeah. So I got to when I started, I thought, Okay, this is great. Here I am. I made it. And then you look around. I spent two years making PowerPoint presentations and thought, Man, this sucks. And then you talk about the Masters of the Universe, and I look around the trading floor and I talk about, first of all, these guys really define themselves as human beings based on their job and not a lot of other. I mean, I'm generalizing here, but I just found that people took themselves far too seriously and define themselves primarily based on their job as opposed to any other aspect of their life, which to me was a little bit sad. And then I also looked around. I thought, Man, there aren't that many of these people who are really that impressive. I mean, this is kind of to some extent, monkey work. I mean, obviously, it changes as you grow up, but that was my experience as as an analyst. And so that was really when I started collecting notes with the intention of eventually writing a book about it. And then so when I left the industry and wants to move back here, I kind of said, OK, well, I've been in Hong Kong, you know, going crazy for eight years. What's the opposite of that? It's probably a leafy golf course suburb of Houston, Texas. And so I moved back here, started a family, and that's when I kind of sat down to write the book and start the start the Twitter account gas elevator.
Patrick (CEO of WSO): [00:25:28] You started, you started the Twitter account and exploded very fast.
John LeFevre: [00:25:32] Yeah, remarkably fast. I mean, the timing was just it was right. You know, it was mid Occupy Wall Street. And so I was sitting in a bar in in Hong Kong right before I was getting ready to leave. And we were talking about Occupy Wall Street and I was there with a friend of mine from Goldman Sachs. And he was talking about how his wife was on the Upper East Side at a dentist's office and mentioned to the receptionist that their insurance was covered by Goldman Sachs. And he or she is getting heck, I mean, there was so much animosity towards kind of bankers and Goldman Sachs in particular at this time that she got heckled out of with her kids heckled out of an Upper East Side dentist office. And we are laughing about it and saying, Man, if people as much animosity as there is, if people really understood the deviance and corruption and disregard for basic societal norms and rules, and the classism, racism and sexism and all this other stuff in terms of the bad behavior, they would be even more appalled than they already are. And so it wasn't that kind of drunken haze that I started elevator's kind of the premise of things overheard in the elevators of Goldman Sachs, which was never to be taken. Literally, it really just kind of quips that illuminated and satirize the investment banking, culture and mentality, certainly the worst elements of it, which was largely what my experience was.
Patrick (CEO of WSO): [00:26:46] So it was obviously very a great, great way to incite get attention and sight kind of really a lot of emotions on both sides, either people thinking it's funny or people thinking it's like, extremely,
John LeFevre: [00:26:58] That's what that's what I loved about it, because I had the kind of the frat bro universe messaging me and responding and saying, This is awesome, I want to go work on Wall Street. This is hilarious. And then I had kind of the slightly more sophisticated, older on the political spectrum, probably more liberally orientated people saying, Wow, this is great as kind of satire and illuminating an odious culture. And so the appeal worked across the spectrum, depending on the lens that people were looking at it through.
Patrick (CEO of WSO): [00:27:26] It's really interesting. Yeah, so it exploded. It really fast that immediately kind of just push you even more towards, Hey, this book has to happen because it's going to be,
John LeFevre: [00:27:35] Yeah, that again, I don't want to sound like a total ass, but that process also was pretty easy for me because, you know, within a very short period of time, I had hundreds of thousands of Twitter followers and I had, you know, CNBC asking me to write for them. I had Business Insider asked me to write for them, and so I started contributing articles that were kind of a blend of humor, satire and. Genuinely good advice, it would be like twenty five rules of bar etiquette or airplane travel etiquette or ninety nine rules to live by or, you know, Wall Street fashion guide, you know, things like that where again, it was supposed to be humorous, but there was a grain of truth in it, and I had written an article called How to be a Man. I guess this was 2013 or 2014 at the end of 2013, and it had like six million views. And to this day, it's still the most read article in Business Insider history, and it just really exploded. You know how to be a man. And from there, I had a bunch of agents calling me saying, Hey, let's put together a book proposal and so teamed up with an agent and we kind of rode showed a proposal which was simply, you know, a bunch of my tweets, an outline of what I wanted to write about for the book and two sample chapters that I put together in pretty quick order. And then from there had seven proposals for from publishers. And then you
Patrick (CEO of WSO): [00:29:05] Were a first time author were given your following. Were you able to negotiate a pretty good advance or are you comfortable sharing like what your advance wasn't? All that stuff?
John LeFevre: [00:29:12] Yeah, so it's kind of it was a mid six figure advance, which for a first time nonfiction author is like the ninety nine point nine percentile, which was amazing too, because I'd also put a big target on it back from kind of the, you know, the finance journalism and fin twit community. All these guys who had been working up to their entire lives to get book deals or get published or find an agent. And I kind of fall into one. That's when I started to see a lot of animosity online and a lot of misinformation and smears, especially as I got closer to publication. And, you know, Goldman Sachs and Citigroup were kind of incentivized to undermine or attempt to undermine my credibility with a lot of falsehoods, which is probably the most frustrating thing about this process, because here I am thinking, of course, people know liar's poker and barbarians at the gate or den of thieves or predators, ball or even monkey business or trade offs. Great, great book. The buy side, which is a
Patrick (CEO of WSO): [00:30:09] Really a really great book, was great.
John LeFevre: [00:30:11] Yeah, I love. And here I am thinking, OK, I've collected these stories. I have this unique vantage point where I've worked with every bank on every continent, from the dotcom bubble through the financial crisis and set above the Chinese wall. It's a vantage point that hasn't really been explored because, you know, there's obviously tens or hundreds of thousands of employees at any given bank. But for the equity and debt syndicate desk, there's you can there's only, you know, 10 20 people and you can only be in New York, London, you know, a few guys in Frankfurt and maybe Hong Kong or Singapore, excluding kind of local market syndication. So it was a very prestigious desk to be on, and it was a very credible vantage point from which you can credibly opine on Wall Street culture. So to see those smears and attack on attacks on my credibility were particularly frustrating.
Patrick (CEO of WSO): 00:31:01] Yeah, I mean, not frustrating, but also not surprising, given they're trying to distance yourself and say, you are a hack of some sort, right?
John LeFevre: [00:31:08] Or yeah, we had to, you know, when I worked in banking, we did these bond deals and these roadshows. We had to work closely with the financial press to promote these deals. So I had good relationships with the corporate communications teams and a lot of journalists. And so right before my book came out, you know, I had the corporate comms guy at Citigroup bragging about calling in favors from Fortune magazine or the New York Times to really negatively review my book. So I found a lot of, you know, this is kind of pre fake news, but it certainly opened my eyes to the how corrupt some of these guys in the media were to and how intertwine them. And obviously, you know. Bloomberg. I mean, I like Bloomberg, obviously, but they can't, you know, the financial services firms, you know, pay their pay their bills, right, and some of these Fortune magazine or Forbes magazine. You know, I'm sure half of their ad revenue comes from the financial services industry, so they have to placate those guys, which I guess is understandable, but it was certainly a very corrupt process.
Patrick (CEO of WSO): [00:32:04] Interesting. Interesting. So your you release the book, it debuts at number seven, you said. Yeah. Times bestseller list. So pretty solid. I mean, you're getting some royalties eventually after that kind of runs through and it's yeah,
John LeFevre: [00:32:20] It sells pretty, pretty steadily. I mean, I think in terms of relevance, it's fairly evergreen and I've continued to kind of evolve my focus in areas that that keeps it, you know, keeps the book, I guess, relevant. So the sales, the sales are pretty, you know, it's not it's not liar's poker. It's not a perennial top seller. But I still see steady sales and steady feedback from people that younger people who come up and probably weren't around five years ago when gas elevator was more relevant or when my book was being promoted. And they kind of come in, come across it or organically or as they prepare for a career in banking or in finance in general, they hear about it and read it, and it resonates with them.
Patrick (CEO of WSO): [00:33:03] So from two thousand, you started a family, you got married, you're in the burbs and that that kind of going a hundred miles an hour to down to a much slower lifestyle, I assume. What was that transition like for you? I mean, you're now like an author. You're right. You're you have you have that. And then potentially you're kind of kind of free at that point, right?
John LeFevre: [00:33:25] Yeah, I mean, that's kind of exactly what happened. I mean, I was going a hundred miles an hour and I wanted to take it down to zero. And so I really did just spend a couple of years writing the book playing golf, drinking and, you know, having a couple of kids. And then, of course. That being the opposite of my traditional banking experience now, the pendulum started to shift back or normalize a little bit, and so having taken a couple of years off to spend with my kids, who obviously were very, very young at that point started to kind of re-engage and focus on on new initiatives. And so the first thing I did was, you know, about two years ago, I was looking at this having a million followers and thinking, What the hell do I do with it? And I had written some kind of fashion article for Business Insider that was really popular. And in it I kind of advocated my personal preference as it related to fashion. And I said, you know, I hate colorful, gimmicky socks. They don't add personality or fashion sense. I don't like pairing or sorting or color matching. And when I work in finance, I would always just get and I love the feeling of fresh, crisp new socks. And so when I worked in banking, I would just buy 10 pair of identical black Calvin Klein socks. And then every two months I would throw them away and get new one. And so I wrote about that a little bit, and I got an amazing amount of feedback from people saying, Wow, it's a lifestyle choice. Like this is just such an excellent, excellent advice in terms of just starting your day with fresh socks, not even thinking about the colors and wasting time or bandwidth doing anything else. And so a couple of years ago, I said, Well, I've got this, this following a pretty good demographic one point two million, mostly male finance orientated, aspirational educated people might as well do something with it. And so I decided to start a fashion line, focusing initially on the neglected top drawer. So just socks, underwear and underwear. So the first thing I did is I went to Neiman Marcus here in Houston and sampled 30 pair of socks and sent them off to a factory in China and tweak the design a little bit to make them thinner and silky and less cotton. Because I don't like cotton more. You know it absorbs moisture and odor and bacteria. Yeah, you know more spandex in the cuff, so it doesn't slip little tweaks like that. And so I'm taking a $20 Neiman Marcus sock and finding a factory that can evolve it and replicate it for 90 cents or whatever, whatever the number is. So and then the way technology has evolved up until two years ago, it was really easy to get into the e-commerce business, especially if you already have a social media following because your customer acquisition cost is zero. And so I went from the factory in China to working with Shopify on the e-commerce side and working with ship on the fulfillment side. And so without really having any overhead or employees, no other concerns other than you have a proven product as a simple product. So as long as you're able to acquire customers, it's a fundamentally easy business to start up. And so did that few years ago.
Patrick (CEO of WSO): [00:36:26] And you want to say the name for anyone that wants?
John LeFevre: [00:36:28] Yeah, sure. It's called Brummel. It's named after Beau Brummel, a 18th century gadabout in London who kind of revolutionized men's fashion, and he kind of came along and said, Hey, why are we wearing these dumb long tights? We should make our fashion statements with our wit and intellect, or even a watch or a scarf or a hat, anything but socks. And so that's the same kind of ethos that we have embraced for the brand. So is really, really simple, understated top drawer needs with a focus on value, convenience and comfort.
Patrick (CEO of WSO): [00:37:03] And so you did this and this was basically it was almost like a subscription base, right?
John LeFevre: [00:37:08] It's replace everything we do, either. So yeah, I mean, if theoretically, we encourage subscriptions, but if somebody who traditionally, you know, anytime you hear sock start up, you kind of roll your eyes. Most of these people are in this kind of colorful, gimmicky marijuana leaf stocks or pick it up socks or you see all these subscription service. And so when I was looking at starting, I thought, Man, this seems like one huge cliché. And so I wanted to be contrarian in terms of the focus and that we went for simple, clean design and then not just relying entirely on the subscription model. And so.
Patrick (CEO of WSO): [00:37:45] Check it out, and so tell me how is it gone, is it is it something where you feel like it's just a like? Does it continually in any SEO or is it continually generating revenue or is like, was there a big surge? And then obviously after the promo, it kind of comes down to a steady state. But is it? Has it done OK for you?
John LeFevre: [00:38:02] Yeah, it's been. It's been great. I mean, obviously, you know, I found whenever I used to say, you buy a Calvin Klein boxer brief and it has the logo is screwed up or there's a tear in the scene. It's just underwear. Who cares? You know, you don't. Who cares. So, you know, and it's a quality product regardless. But I found the return rate is less than one percent. The subscription cancellation rate is, I think, less than one percent. And so we're just acquiring customers and then gradually looking at expanding our product offering into higher dollar margin SKUs. And so you start by selling people seven dollars or $20 Neiman Marcus stock for seven dollars and deliver it to them. And then you look at selling them, you know, 30 dollar undershirts and twenty five dollars underwear. And just at the end of last year, I rolled out a limited edition tie which was filled out, sold out pretty quickly. And so any time I wanted to acquire customers I've used, I've written some content or use social media or put out Instagram post, which has been easy. I'm obviously that's a well that you can't go to forever without seeing diminishing returns. And so, you know, we reached a kind of an inflection point last year. We decided we wanted to kind of grow up and be very serious in terms of going after some of our much larger competitors and competitors who are raising money to $300 million valuation. And so we closed a seed round with a private equity investment firm here in Houston at the end of last year. And we're in the process of really ramping up our fulfillment, getting our cost down a little bit. Our SKU expansion focusing on higher dollar margin SKUs and then really a more sustainable CMO effort aside from just leaning on the social media platform and the content.
Patrick (CEO of WSO): [00:39:45] I'm curious about that because our business is very similar. It's our community presence helps us sell our interview courses, helps us sell our subscriptions to our company database. All that stuff. I'm curious, have you has there been any results in terms of like Facebook ads, Instagram ads? Have you tried any of the paid stuff and has it been? It's tough when you're selling a seven dollar stock like you have very little dollars to play with in terms of acquiring the customer, right?
John LeFevre: [00:40:12] Right. But you know, as long as you know you're acquiring the customer for life and that you are confident in your ability to sell them higher dollar margin stuff later on, then the lifetime value of that customer goes well beyond a single purchase of one pair of socks. And so it's really amazing. When we started, so started two years ago, let's call it a year and a half ago, our average ticket size was probably thirty two dollars. And now, having just added a few SKUs, our average sales probably eighty five dollars. And we're really only getting started on the high margin stuff as it relates to your specific question on kind of being really aggressive on the Facebook and Instagram ads. It's actually something that we haven't really employed, so we're still in the process of putting together the video content and working with the team out in California to get that stuff rolled out. So you'll start seeing really aggressive, really aggressive push from us, probably over the next couple of months.
Patrick (CEO of WSO): [00:41:10] Such is exciting, I love the startup stuff, so you can tell, yeah, we can talk about it, we could talk about this for hours, so. So OK, so you've done that. That seems to be going great. Are you doing the day to day on that or working a few hours a day on that? Or what's what are you spending your time most of your day now?
John LeFevre: [00:41:28] Yes, so. You know, we close the seed round last year, and we're just ramping that up now, so that's occupying. A large portion of my day, and then I started working with the private investment firm that participated or led our seed round and looking at other deals kind of dusting off the toolbox. And so we're working on a kind of health care related startup which will be launching in about two months, which I can't really get into detail on. But I think we're very, very excited about that. And we've been looking at the kind of continued evolution of gas elevators, social media footprint in terms of it being kind of almost like a media company. So looking at a couple of different books, looking at the podcast, a website, I found the media space to be very kind of siloed. You know, take like Business Insider or even at a political level, right? Like, you know, we went to boarding school, right? Most of your friends and my friends are probably left wing, you know, in this election cycle, even the previous election cycle, if I got into a political conversation with somebody and sent somebody a Fox News link or a Breitbart link, they wouldn't even click on it. And conversely, if I got a Huffington Post link, I immediately dismiss it. And so I didn't really see a place on the internet where which appealed because, you know, I look at Twitter as kind of the curation, which I think Twitter has is really a big part of my life and that I can I can wake up every morning in 10 minutes, go through my curated Twitter feed and have a better understanding of everything that's going on than if I'd spent two hours going through ESPN and The New York Times. You know, TMZ and the real estate section of Sotheby's or travel and leisure or whatever. And so I didn't think there was a home for people that reflected those eclectic interests and also a home that combines created content. Because, as you know, it's hard to run a sustainable media company and rely entirely on created content without a massive, massive upfront in terms of capital. But if you're able to consistently create decent quality content and then blend that in with curated content, I think it becomes eminently more sustainable. And so I thought there was a place for that, as well as layering in different content categories such that one place where you have traditional content, you have video content, you have podcast content, you even have meme content almost, you know, you say, OK, we can get a small group of guys and they can spend eight hours a day on Reddit so that everybody else doesn't, doesn't have to, or they can spend eight hours a day curating means from Instagram so that, you know, everyone else doesn't have to. And I think there's value and appreciation for that, that curation and I don't think a lot of people are doing that good of a job in terms of a destination that brings all that together and isn't singularly focused on, say, finance or politics or current events or sports. It just curates a blend of across a blend of across that. So we started a website which is still in beta test right now called the wimp, which we're pretty excited about. It's sort of like a this is a great description of it, but I would say it's almost like Business Insider meets Drudge Report with a cleaner, more updated aesthetic. And so I think that's going to be an increasing focus of mine moving forward. And then we're going to layer in with that kind of a podcast. And so we were looking at starting the podcast, which is something I've thought about for a while. So we have all these followers I can. I know a lot of people that are influencers or well-known figures in the business world or the media world or the political sphere who follow the elevator on Twitter. I can reach out to them and get them on my podcast. The investment firms that we work with has an extensive Rolodex here in Houston as it relates to professional athletes and business leaders and people like we can get them on the podcast. I know this from when I wrote the book. My publicist and my publisher made me go on every single podcast. They were asked for me to do, regardless of how big or small I mean. Right? Exaggerating there. But generally speaking, I had to do a lot of podcasts that I didn't want to do when I was growing a book. And so another strategy of ours is to reach out to publishers and publicists and say, Hey, you know, this book is coming out next month or next week. Here we have now when I add the whim to elevator combined, you know, a million and a half followers across. A very diverse group of social channels in a way that not a lot of people do in terms of having, you know, 100000 people on Instagram. 400000 people on. On Facebook and, you know, 900000 people on Twitter, et cetera, et cetera. It's a pretty compelling case, and I think we're going to be it's going to be easy for us to kind of bring in some exciting guests and really get the podcast rolling. But it's something that we're really just it's kind of in its infancy right now. It's called the grace, the grace. It's kind of part of the under the whim umbrella. And we're just going to combine that with all of the legacy elevator stuff, but the kind of evergreen content as well as the social media footprint. So, you know, that's kind of what my focus has shifted to now. So, you know, fashion, the health care startup and now this this media initiative, which I
Patrick (CEO of WSO): [00:47:07] Know you're busy a lot of calls like, you're super busy. That's awesome
John LeFevre: [00:47:12] To have. I mean, obviously, it's you know, I spent I spent two or three years just, you know, playing golf, drinking and hanging out, changing diapers.
Patrick (CEO of WSO): 00:47:18] So it's kind of nice. I'm in that stage. I'm in that stage right now. I still I'm still changing a lot of diapers, so it's nice to be out of it, I guess. Tell me better. But anyways, anything before we call it anything you want to share with the listeners kind of or advice you would give to your younger self, kind of not knowing what you didn't know, not knowing that you're your path would be so winding. Anything you tell yourself?
John LeFevre: [00:47:42] Yeah, sure. I guess. I guess I'm not trying to do a shameless plug here, but you know, I did write, you know, 10 reasons why Wall Street is still a great place to start your career. And again, this is kind of a cynical, cynical approach how to how to get a job on Wall Street and how to kind of excel as a new hire or even in your summer internship. And I shifted all that content. It's been amazing to me because, you know, it's taking a step back this this content, the content is so evergreen that the legacy stuff still gets a couple of hundred thousand views every month, and I wasn't really doing anything with it. So that's another component of this media initiative is to keep that evergreen content living and breathing and updating it and tweaking it and making sure that it stays relevant. So all that old content, which I think can be valuable, especially to some of your younger listeners 15 books to read If you want to work on Wall Street, you know how to how to dress on Wall Street. The hierarchy of watches on Wall Street, I mean, just all that stuff is readily available on the whim, and we're going to be increasingly more aggressive in terms of generating new relevant content and then kind of letting that in with our more recent Instagram initiative. I mean, we just started on Instagram less than six months ago and we have, you know, 80000 followers. And so it's been fun. I didn't think I would like it, but that's been fun in terms of. Advice I would give my younger self. I mean, I guess it kind of aligns with what a little bit what we talked about earlier. You know, just network like crazy, figure out what your your passion is and then find the people that you look up to in that space and emulate what they have done to achieve that success. And then, of course, the minute you're not happy. Just go do something else, you know, life is life is too short. But I guess that that kind of covers it.
Patrick (CEO of WSO): [00:49:37] That's great. Well, John, thanks so much for taking your precious time and your busy time to come on the pod. Really appreciate
John LeFevre: [00:49:43] It. Thank you. I appreciate it. And then hopefully, you know, we'll we can collaborate in some scope here with the podcast stuff over the next couple of months. And I'm sure there's always there's always scope to get in the in the weeds on interview tips or internships or whatever it is. I think there's plenty of areas here we can always find something to talk about. So I really appreciate you taking the time and I'll talk to you soon.
Patrick (CEO of WSO): [00:50:09] And thanks to you, my listeners at Wall Street Oasis, if you have any suggestions whatsoever, please don't hesitate to send them my way. Patrick at Wall Street Oasis. And till next time.
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