Why founding a three-person startup with zero revenue is better than working for Goldman Sachs (Antonio Garcia-Martinez)

Why founding a three-person startup with zero

revenue is better than working for

Goldman Sachs.

by Antonio Garcia-Martinez on 23. Jul, 2010 in Grandiose Propositions

The Road to Serfdom

I joined Goldman Sachs in 2005, after five flailing years in a physics Ph.D. program at Berkeley.

The average salary at Goldman Sachs in 2005 was $521,000, and that’s counting each and every trader, salesperson, investment banker, secretary, mail boy, shoe shine, and window cleaner on the payroll. In 2006, it was more like $633,000.

In the summer of 2005, I took one look at my offer letter and the Goldman Sachs logo above it, another look at my sordid grad student pad, and I got on a plane to New York within the week. I packed my copy of Liar’s Poker for reference.

My job on arrival? I was a pricing quant on the Goldman Sachs corporate credit trading desk (1). We traded credit-default swaps, both distressed and investment-grade credit, and in the bizarre trading experiment assigned to me, the equity part of the corporate capital structure as well.

There were other characters in this drama. The sales guys were complete tools, with a total IQ, summing over all of them, still safely in the double digits. The traders were crafty and quick-witted, but technically unsophisticated and with the attention span of an ADHD kid hopped up on meth and Jolly Ranchers. And the quants (strategists in Goldman speak)? Mostly failed scientists (like me) who had sold out to the man and suddenly found themselves, after making it through two years of graduate quantum mechanics, with a bat-wielding gorilla peering over their shoulder (that would be the trader) asking them where their risk report was.

Everything is quantifiable

Wall Street is inward-looking and all-consuming. There exists nothing beyond the money game, and nothing that can’t be quantified into dollars and cents.

To cite a particularly grotesque example, once a year, one of the partners would buy a pallet of White Castle burgers and first-year analysts and associates would have a burger-eating competition (with some nominal amount donated to charity). All trading on the Goldman Sachs trading floor would stop as every man on the floor would gather ’round to watch the plebes stuff themselves.

Trading turned from interest-rate swaps (minimal notional size: $50MM) to the over/under on the burger count for a particular analyst. Occasionally, one poor schmuck would puke, and the partner would rush to catch it with a plastic trash bin.

The odds-on favorite was a young analyst, who’d employ the Kobayashi technique to get the tiny greasepucks down. After sweeping the field with 26 burgers eaten, he’d leave the styrofoam cup containing a congealed scum of burger grease and bun and patty bits floating on top, as mute testimony of his victory. The trading floor smelled like the inside of a deep fryer for the whole day (2).

Link to complete article including:

• Death, Wall Street-style
• Line up and take a number
• Jose Cuervo, meet Smith and Wesson
• Better to be first in a village than second in Rome

Thanks to Business Insider for the head's up, Link to Business Insider