Greenwood is a banking app designed for Black and Latinx communities. In late March, the startup announced a $40 million Series A round. Cofounder Ryan Glover and Truist Ventures head Vanessa Vreeland detail how the deal came together.
"How could this firm take such huge economic exposures into Viacom and other companies without having to make any disclosures? Because of swaps," Paul Cellupica, former general counsel for the SEC's investment management division, told Insider. "It will raise questions." Read more here.
A key piece of SPAC transactions is drying up. "We are seeing, on the PIPE front, exhaustion and being bombarded with deals and pressure to make decisions quickly," said David Goldschmidt, a Skadden partner who specializes in capital markets work. Read more here.
For those looking to hang their own shingle, Insider talked to more than a dozen industry insiders and compiled a list of bankers, advisors, consultants, and lawyers who are known for their ability to get a new manager up and running. You can see the full list here.
Former Goldman Sachs partner Sumit Rajpal is starting his own investment firm. He's already identified a few investments and is raising money for the transactions. Rajpal has also poached people to join him from Goldman, angering some of his former colleagues. Read everything we know here.
Cathie Wood, the founder of ARK Invest, has amassed legions of obsessed followers. Wood has become a favorite of the Wall Street Bets crowd, and successfully kept control of her firm. Now, with assets accumulating and new funds coming out, the question is, can she sustain her success?
Insiders reveal how the ARK Invest founder won over memelord traders and boomer investors alike.
Three more women have joined a lawsuit against the $2.2 trillion asset manager Pimco, bringing forward new accusations of sexual harassment against two men who once held prominent positions at the firm.
David Solomon has been Goldman Sachs' CEO for more than two years after succeeding Lloyd Blankfein. And Solomon has made significant changes to the company's leadership team and a number of senior leaders have left in recent months.
If there's one takeaway, it's that there will be plenty of news, deals, and drama to keep tabs on. If you're not yet a newsletter subscriber,you can sign up here to get your daily dose of the stories dominating banking and business.
M&A activity came surging back in the latter half of 2020. Now, Wall Street is primed for robust dealmaking in 2021.
A new regime in Washington could alleviate the apprehensions of some overseas buyers and spark renewed cross-border dealmaking activity, said Vito Sperduto, co-head of global M&A at RBC Capital Markets.
Cross-border transactions are likely to see a "significant uptick" once the administration of President-elect Joe Biden steps in, Sperduto said. While some international deals have happened in the past four years, "there already was a slowdown in cross-border transactions pre-pandemic," he said, "and it's just gotten worse."
Hedge funds, on average, had a good year - the most recent Preqin data shows hedge funds are up more than 13% for the year after a strong November.
But performance wasn't equal across all strategy types, with concentrated equity managers - especially those with big private-market bets- leading the way while well-known quants struggled. And a lot of those trends are expected to carry over through the new year.
Insider asked four fintech investors what they're looking out for in 2021. All mentioned embedded finance as a major trend that's likely to continue as fintechs, and those in other industries, look to expand the types of services they offer customers.
"I think we're in a great rebundling," Ashley Paston, an investor at Bain Capital Ventures, told Insider. "If you look in any fintech, they have expanded outside of their initial product to create more value for their end customer."
Investors also see a rise of 'finfluencers' to help reach younger customers, especially after Step, a digital bank for teens, launched in partnership with TikTok star Charli D'Amelio. Since its rollout in October, the fintech has over 500,000 sign-ups and raised a $50 million Series B.
The past 12 months accelerated trends like mobile banking and digitization that have long been building in consumer banking. Both were part of a broader shift away from in-person branch visits as customers shunned human contact during the pandemic.
It's no surprise, then, that as 2020 turns into 2021, predictions for what banks will prioritize revolve around further developing technological capabilities and online customer experience.
Digitization and cloud technology, as well as the broader consumer credit environment and cost-cutting measures, were top of mind when bank execs discussed their goals for the year ahead.
Many fintechs saw massive growth and adoption in 2020. There's also been no shortage of funding. Private funding has surged with a record number of mega-rounds - $100 million and above - this year, according to a recent CBInsights report. And fintechs like Affirm and Marqeta are gearing up for IPOs.
Investors don't see things cooling down any time soon.
"We're very excited for some of our more mature companies for the exit environment that they'll be seeing," said Jay Ganatra, partner at PayPal Ventures, whose portfolio companies include personal finance app Acorns and earned wage access startup Even.
2020 was a big year for legal tech. As law firms and businesses across industries shifted to remote work, legal tech companies stepped in to offer digital solutions to help streamline the transition, from client relationship management to contract analysis.
Not since the last financial crisis has Jeff Feldman, a Chicago-based recruiter and consultant for financial advisors, seen such a frenetic year of activity.
2020 has been his second-busiest on record by volume, bested only by 2009. And he doesn't see that slowing down. Today, Feldman's roster of clients includes wealth managers First Republic, LPL Financial, RBC Capital Management, and Rockefeller Capital Management.
"I think you're going to see a lot of movement in the first half" of next year, Feldman said. "Because of the past six months, advisors have taken this time to educate themselves on new business models - and the competition."
One big change from 2020 that's likely here to stay is the efficiency that has been introduced in the IPO roadshow process, according to Jane Dunlevie, co-head of Goldman Sachs' global internet investment banking.
Traditionally, bankers hit the road leading up to an IPO to court investors and generate buzz. But the pandemic forced bankers to find creative virtual solutions for engaging investors without meeting them face-to-face.
"It's been highly productive," Dunlevie said. "We're getting roadshows done in fewer days, for the most part, so we can cut off one or two or even three days of meetings, and these IPOs are getting done I think incredibly successfully."
Aspects of that will likely continue.
"Our expectation is to try and take the best of both worlds, if and as the world reopens," she said. That might mean management teams hit up one or two large cities, but "we can probably take many of these efficiencies into processes going forward."
It was a wild week for IPOs. Now, one company is taking a time out. Roblox is delaying its initial public offering until next year after the video game maker decided it would be too difficult to price its shares, the Wall Street Journal reported on Friday night.
We took a look at what's been driving the IPO rush and enormous pops in early days of trading for big names like Airbnb and DoorDash. From Alex Morrell:
Not since the days of Y2K, GeoCities, and eToys.com have initial public offerings garnered such unbridled enthusiasm from investors.
When DoorDash and Airbnb went public this week, their stock prices shot up on the first day of trading, soaring 86% and 113%, respectively. And the average IPO this year has seen a 41% first-day return.
The IPO market has notched other staggering figures this year as well, with nearly 430 deals, the most since 2000, and $160 billion in deal value, an all-time high, according to data from Dealogic.
The dynamics fueling this frenzy are nuanced. But as retail traders fight over small allocations of popular, high-growth stocks and momentum chasers follow in their wake, market valuations are inflating and some experts are throwing around the "bubble" word again.
Steve Schwarzman, the billionaire founder and CEO of private-equity giant Blackstone, revealed his way of increasing transparency at the firm during the pandemic.
He launched what he dubbed "Blackstone TV" - a weekly update from Schwarzman and his management team that every Blackstone employee is invited to watch. He plans to continue it, even when the pandemic has passed and employees have returned to the office.
Coatue Management, a secretive hedge fund run by the billionaire Philippe Laffont, has had a wave of departures from its vaunted data-science team.
The team, run by a young partner named Alex Izydorczyk, had its internal quant fund shut down this summer.
Business Insider spoke with more than 20 sources - including 10 ex-employees as well as investors, vendors, and hedge-fund recruiters with firsthand knowledge of the firm - about the rise and demise of Coatue's quant fund.
Betterment's new CEO is replacing founder Jon Stein at a super-competitive moment for the robo-advisory industry. Sarah Kirshbaum Levy, a former ViacomCBS executive, will be tasked with growing Betterment's brand and drawing in new customers from legacy wealth managers that dwarf it in size.
While candidates for Stein's role largely felt confident in the brand, some had concerns around the general business model of robo-advisors, a source familiar with the process said.
One analyst we spoke with said he sees Betterment as a possible acquisition target rather than headed for an initial public offering, while Levy told the Wall Street Journal that an IPO was in its future.
The world of fashion, in many ways, is about standing out. So it's fitting that Chidi Achara, who has worked with brands like Cole Haan, Levi's, and Hugo Boss, will be focused on doing just that for fintech Stash.
Achara has big plans for the startup he joined in September as its first chief creative officer. He's tasked with engineering and leading a rebranding effort aimed at helping Stash stand out from a crowded field of rivals.
Launched in 2015, Stash is a finance app that offers retirement, bank, investment and custodial accounts for a monthly subscription cost. The New-York based fintech raised $112 million in Series F funding in April, and has enjoyed considerable growth throughout the pandemic.
In April, just weeks after the raging coronavirus pandemic threatened to shut down the US economy, Silver Lake Partners and Sixth Street Partners made a bold bet.
The two private-investment firms together lent $1 billion to Airbnb, the home-sharing company that was then watching its revenue plunge as people around the world stopped traveling. The loan came with a lofty coupon of about 10% and an equity kicker in the form of warrants that converted into one share apiece at less than $30.
The following month, Silver Lake bought a slug of common shares off of Belinda Johnson, the former chief operating officer of Airbnb who now sits on its board, for more than $27 million.
We're just a few days in, but December is shaping up to be a busy one.
This week, S&P Global announced it plans to buy IHS Markit in a $44 billion all-stock deal. And Macquarie said it's set to buy Waddell & Reed for $1.7 billion, and plans to sell Waddell's wealth-management business to LPL Financial for some $300 million once that deal closes.
Plus, Wall Street has also been gearing up for a year-end IPO rush with big names including DoorDash and Airbnb slated for public debuts in the coming week.
This week, Business Insider's Wall Street reporter Reed Alexander spoke with Matt Breitfelder, the global head of human capital at Apollo Global Management; Sara Diniz, vice president in human resources at Bain Capital; James Cherubim, head of talent acquisition at The Carlyle Group; and Anthony Keizner, co-managing partner at Odyssey Search Partners.
Virtual dealmaking has become de rigueur in 2020, but when $44 billion is on the line, video calls can't always replace in-person meetings.
When S&P Global and IHS Markit were closing in on getting a deal over the line, their respective execs agreed that a private, in-person meeting would help both firms' top brass foster the trust and goodwill to push the transaction forward, two sources told Business Insider.
S&P Global's $44 billion all-stock deal to buy IHS Markit, the largest acquisition of 2020, was given a push when the firms' CEOs - S&P's Douglas Peterson, and IHS Markit's Lance Uggla, accompanied by their respective deal-teams - met face-to-face in a rented boardroom in Connecticut, according to one source familiar with the situation. The meeting, which took place this fall, included precautionary measures from both parties in light of the coronavirus pandemic, both sources said.
While the magnitude of the deal certainly complicates things, the fact it was an all-stock transaction makes it even more tricky. Instead of simply handing over cash, shareholders on both sides of the deal are tied to each other after the fact because of the use of company stock as currency.
Lone Pine - the $30 billion Tiger Cub headquartered in Greenwich, Connecticut - has soared in 2020.
The equity manager has returned more than 23% in its flagship long-short fund after gaining roughly 1.6% last month, sources say. Its long-only fund though has been the real star of its offerings - the fund is up more than 38% for the year after returning nearly 11% in November.
The discreet manager - founded by Stephen Mandel Jr. and now run by the team of Mala Gaonkar, Kelly Granat, and David Craver - has fueled its run this year with the success of its biggest position, according to the firm's most recent regulatory filing: Canadian e-commerce platform Shopify.
As of the end of September, the retailer made up more than 7% of Lone Pine's portfolio, filings show, and Shopify has continued to skyrocket in price; since the start of the year, the company's stock has more than doubled. The firm also boasts large stakes in Facebook and Microsoft, both of which have risen at least 35% this year.
Annual total compensation for Wall Street's fixed-income, currencies, and commodities groups are expected to grow for the first time in four years, a dramatic reversal for a class of Wall Street traders who have had several lean years, according to data in a recent survey.
FICC groups may see total compensation, including base salary and bonus, increase by more than 9% compared with 2019, according to a new survey conducted by Options Group, a recruiting and consulting firm for the financial-services industry. That bump would be the first year-over-year increase of the FICC bonus pools since 2016, according to the survey.
On the heels of yet another major investment management combination, a new report sheds light on where analysts think the next deal for wealth and asset managers could strike.
"Asset manager M&A wave will continue with a variety of potential transactions," analysts at Credit Suisse led by Craig Siegenthaler wrote to clients on Thursday.
The evening before, Australia-based Macquarie Group said it would acquire investment manager Waddell & Reed.
Macquarie is set to buy the Overland Park, Kansas-based firm for $1.7 billion, or $2.3 billion Australian dollars, and is set to sell Waddell's wealth management business to major independent US broker-dealer LPL Financial for some $300 million once that deal closes.
Once in charge of overseeing a firm-wide restructuring and re-imagining of Boies Schiller following a series of high-profile exits, attorney Nicholas Gravante has decided to exit himself and is joining the law firm of Cadwalader Wickersham & Taft.
The news marks the latest sign of troubles at the firm founded by the prominent trial lawyer, David Boies.
Boies Schiller staffed 350 lawyers at its peak and has experienced dozens of partner departures this year. Today the firm lists 207 attorneys on its website and it has recently sought to sublet part or all of its glamorous New York City office.
Many of the firm's exits have stemmed from internal friction over the divvying of compensation, as well as transparency into finances generally, but attorneys have also wrestled with public criticisms of Boies following his representations of Harvey Weinstein and Elizabeth Holmes.
Gravante was one of the two leaders, alongside Natasha Harrison, tasked with revamping pay for both partners and associates, and setting the strategic vision of the firm. His exit was met with surprise by lawyers who have left the firm, who pondered what the future now held for the 23-year-old litigation powerhouse.
The pandemic has upended the real-estate industry, forcing offices and shops to reinvent themselves and causing millions of Americans to relocate or reconsider their home bases for work, financial, or personal reasons.
Against this backdrop, we're spotlighting professionals who are thriving, seizing opportunities despite, or because of, COVID-19's effects on commercial and residential real estate in the US.
More below on Charles Schwab layoffs and branch consolidation; WeWork's rent demands; a new twist on paychecks that's being piloted by payroll giant ADP; and a look at Kristin Lemkau's big plans for JPMorgan's wealth-management business.
If you're not yet a newsletter subscriber, you can sign up here to get your daily dose of the stories dominating banking, business, and big deals.
Charles Schwab told staff it would cut 3% of its combined workforce with TD Ameritrade. And Schwab has "moved aggressively" to start streamlining branch networks now that its tie-up with TD Ameritrade is complete.
ADP, one of the world's largest payroll providers, is piloting an earned wage access option. Belinda Reany, who heads up ADP's new products and innovation, says the pilot will help the company determine the best version of the now-prolific on-demand pay feature.
ExamSoft, the software company used by states to run online versions of the bar exam, will be paid upwards of $2 million in test-taking fees, an analysis by Business Insider's Yoonji Han and Jack Newsham found.
It was a busy week for Wall Street news, with fines, exits, pay cuts, and more. Here's what you need to know:
2 top Morgan Stanley commodities execs have left after the bank discovered the group was improperly using WhatsApp to communicate. A source familiar with the matter told Business Insider the two had displayed a "failure to supervise use of the communications within the commodities business."
JPMorgan is considering hiring as many as 4,000 financial advisors in the next five to six years, wealth boss Kristin Lemkau told Business Insider. The firm has already hired large teams of experienced FAs from rivals including Merrill Lynch and UBS in recent months.
Wells Fargo is exploring a sale of its asset management business, Reuters first reported.
How to ace an interview at Blackstone
Reed Alexander and Casey Sullivan chatted with Blackstone President and COO Jon Gray, industry headhunters, and Blackstone's global head of human resources to learn what it takes to stand out and get hired at the firm. Here are some of the highlights:
There were 19,000 applications for the firm's 2020 first-year analyst class, and just 94 were hired, according to data Blackstone shared.
"At a place like this, we have relatively few people. And we really need people who care," Gray said.
"I look for too many references to 'I' versus 'we,'" Paige Ross, Blackstone's global head of HR, told Business Insider. "Most people do things as part of a team, and I want to see candidates accurately reflect that."
While raises weren't as common as they were a year ago, a majority of respondents to Heidrick & Struggles latest survey on private-equity compensation say they got a pay bump over their 2019 base salary.
Demand for data centers has boomed and bluechip investors like Goldman Sachs, KKR, and Blackstone have taken notice, announcing deals and unveiling plans to invest.
On Tuesday, Goldman said it would invest $500 million into data centers around the globe. And as Dan Geiger reports, users continue to take spaces — with ByteDance, the parent of TikTok, signing up for 53 megawatts in Northern Virginia and Bloomberg LP anchoring a huge data-center complex in New Jersey.
After a six-month pilot period where banks like Morgan Stanley and Deutsche Bank put it to the test, Goldman Sachs' internal data platform Legend is being released to whoever wants to use it on coding-collaboration site Github.
As Samantha Stokes reports, tax and audit firms Deloitte and EY have found business opportunities by contracting with state governments to provide technical support, staffing for unemployment claims centers, and more.
Klarna CEO Sebastian Siemiatkowski on why digital retail checkouts are a huge buy now, pay later battleground: "There are a lot of buttons in the checkout. I just want to be the most popular."
Nasdaq CEO Adena Friedman on the future of the cloud: "Do I think in 10 years, that many of the markets around the world, including Nasdaq, could and should be able to leverage cloud to operate their actual trading activities? The answer is yes, I do."
FactSet CFO Helen Shan on how the data giant quantifies innovation: "Speed, reliability, ease of use. People don't necessarily think of that as innovation, but the reality is that is."
AlixPartners CEO Simon Freakley on what's separated winners from losers in 2020: "One doesn't have to have an online strategy to be successful, but one has to have a defining strategy."
On the move
Opendoor has hired Daniel Morillo to be the iBuyer's chief investment officer. Morillo is currently a managing director and head of equity quantitative research at $34 billion hedge fund firm Citadel.
Opendoor last month announced plans to merge with Social Capital Hedosophia Holdings Corp II, a SPAC led by venture-capitalist Chamath Palihapitiya.
Litigation finance is going mainstream. Here's how a US stock listing for top player Burford Capital could transform the landscape for investors placing bets on lawsuits.
Big bank earnings season was in full swing this week. From top execs laying out the rationale behind dealmaking to shedding light on their plans for the future of the physical office, here are some of this quarter's highlights:
US government-controlled Fannie Mae, a key player in the country's massive mortgage market, is shuffling leadership in its largest business line, according to recent internal memos seen by Business Insider.
The changes inside Fannie Mae, which the government took over during the great financial crisis and has become a political football, come just weeks before the US presidential election.
As Alex Morrell reported, Morgan Stanley has had a huge year in credit trading — reaping nearly $1 billion from its investment-grade desk.
Despite ranking fourth in underwriting IG debt, the firm is a perennial top competitor when it comes to trading it. Helping its cause: Morgan Stanley has one of Wall Street's top operations in algorithmic and bond portfolio trading, which has accelerated in 2020.
For any payments player, tech is a huge part of the budget. Speed and security of a network can make or break a company like Amex or Mastercard.
And that means a large part of payments companies' headcount lies in tech. Amex, Mastercard, PayPal, Square, and Visa need to hire the best technical talent to build new ways to pay and keep the systems up and running.
Hundreds of lawyers in New York and beyond who made a specialty out of showing up for court appearances on behalf of other lawyers have found themselves out of work as courts have moved online. So-called per-diem lawyers could make about $125 per appearance, and for some of them, the numbers really added up.
New York courts have gradually been reopening for in-person trials and arguments, but the events that filled a per-diem's day are mostly virtual, so the lawyers who used to send them work can call in themselves.