[{"_1":2,"_3":-5,"_4":-5},"loaderData",{"_5":6,"_7":8},"actionData","errors","root",{"_137":-5,"_138":-5,"_139":140,"_141":142,"_143":144},"routes/clips.$id.$slug",{"_9":10,"_11":12},"clip",{"_13":14,"_15":16,"_17":-5,"_18":19,"_20":-5,"_21":22,"_23":24,"_25":26,"_27":28,"_29":30,"_31":32,"_33":34,"_35":36,"_37":38,"_39":40,"_41":-5,"_42":-5,"_43":-5,"_44":45,"_46":-5,"_47":48,"_49":50,"_51":-5},"canonicalUrl","https://howleaderslead.com/clips/1626/understand-your-business-model","id",1626,"title","Understand your business model","subtitle","transcript","WEBVTT\n\n1\n00:00:00.000 --> 00:00:06.430\nAnd the best advice for small businesses is to try to take a long-term view\n\n2\n00:00:06.430 --> 00:00:07.320\ntoward building\n\n3\n00:00:07.320 --> 00:00:12.320\nyour business, make sure you understand the business and economic model of the\n\n4\n00:00:12.320 --> 00:00:13.160\nbusiness,\n\n5\n00:00:13.160 --> 00:00:16.960\nand the business can really drive a margin or an economic model.\n\n6\n00:00:16.960 --> 00:00:19.770\nA lot of people start businesses because they have a good idea, but they haven\n\n7\n00:00:19.770 --> 00:00:20.240\n't really\n\n8\n00:00:20.240 --> 00:00:23.920\nthought through how the economics of the business work.\n\n9\n00:00:23.920 --> 00:00:26.420\nSo make sure you really understand the economics of the business and the\n\n10\n00:00:26.420 --> 00:00:27.960\neconomics of the business\n\n11\n00:00:27.960 --> 00:00:32.100\ncan support your plan and try to plan, try to get help, try to find mentors,\n\n12\n00:00:32.100 --> 00:00:32.600\npeople\n\n13\n00:00:32.600 --> 00:00:36.320\nthat have experience that can help you broaden your experience.\n\n14\n00:00:36.320 --> 00:00:40.170\nMost entrepreneurs of small businesses have certain skills, but they don't\n\n15\n00:00:40.170 --> 00:00:40.880\nnecessarily\n\n16\n00:00:40.880 --> 00:00:44.530\nhave the broad range of skills that are necessary as businesses scale, whether\n\n17\n00:00:44.530 --> 00:00:45.200\nit's finance\n\n18\n00:00:45.200 --> 00:00:48.840\nand planning skills, budgeting skills.\n\n19\n00:00:48.840 --> 00:00:52.750\nThink about how you can find ways to get mentors that can help you with those\n\n20\n00:00:52.750 --> 00:00:54.240\nthings and really\n\n21\n00:00:54.240 --> 00:00:59.360\nmake sure you understand the base economic model and the base economic model\n\n22\n00:00:59.360 --> 00:01:00.040\nworks and\n\n23\n00:01:00.040 --> 00:01:03.010\nthen pour your heart and soul into it because running a small business is not\n\n24\n00:01:03.010 --> 00:01:03.440\neasy.\n","pretty_transcript","start_time",2988339,"end_time",3051389,"keywords","Strategy, business model, small business, entrepreneurship, finance, Goldman Sachs, banking","slug","understand-your-business-model","origin","cms","mux_playback_id","euIr4v39tOmYDyTW7uBozSyRLFGT23xfHByFLNKRzTM","mux_asset_id","P01w3tCv00namuxnDdinJSHFX4mnbEbtPNa49OaiMr8Zs","leader_id",7,"episode_id",154,"updated_at","2025-02-26T20:07:05.000000Z","meta_title","meta_description","og_image_media_id","web_url","https://www.howleaderslead.com/clips/1626/understand-your-business-model","og_image_url","leader",{"_13":36,"_101":102,"_103":104,"_105":106,"_25":107,"_108":109,"_62":110,"_59":110,"_111":112,"_69":113,"_39":114,"_115":-5,"_41":-5,"_42":-5,"_43":-5,"_116":117,"_89":118,"_44":119,"_120":121,"_122":123,"_46":-5,"_124":125,"_126":127,"_93":128,"_51":-5},"episode",{"_13":38,"_15":52,"_27":53,"_17":54,"_55":56,"_18":57,"_20":58,"_59":60,"_61":-5,"_62":60,"_63":-5,"_64":65,"_66":67,"_68":-5,"_69":-5,"_70":71,"_72":73,"_74":-5,"_35":36,"_39":75,"_41":-5,"_42":-5,"_43":-5,"_76":77,"_78":79,"_80":81,"_82":83,"_84":-5,"_85":-5,"_86":87,"_88":-5,"_89":-5,"_46":-5,"_90":91,"_92":-5,"_93":-5,"_51":-5},"og_image_media","Take the long view","take-the-long-view","Learn how to take a longer view of things – and why it’s crucial to build trust and enrich your organization’s culture. Discover two keys to success for any small business. Plus, how David got into DJing and why it’s important to spend time on your hobbies.","summary","

Every leader feels a pressure to deliver. People want results, and they want them now.

Because of that, it’s easy to get short-sighted. Sometimes, we don’t really give ourselves permission to think too far ahead.

But if you want success that’s sustainable, you’ve got to learn how to take a longer view of things.

That’s exactly what you’ll learn from today’s guest, David Solomon. He’s the CEO of Goldman Sachs, one of the most renowned companies in the financial industry.

David faces a lot of short-term pressures. But those don’t keep him from looking down the road and taking a long-term approach.

In this conversation, you’re gonna learn how it’s done – and why it’s crucial for any leader who wants to build trust and be a part of something that lasts.

You’ll also learn:

An economic outlook and summary that every leader needs to hear right now
3 questions to evaluate your career path
An important mindset shift you need to make if your company operates in multiple divisions
Why it’s important to make time for your hobbies (you won’t believe David’s side hustle!)
Two keys to success for any small business leader

Take your learning further. Get proven leadership advice from these (free!) resources:

The How Leaders Lead App: A vast library of 90-second leadership lessons to stay sharp on the go

Daily Insight Emails: One small (but powerful!) leadership principle to focus on each day

Whichever you choose, you can be sure you’ll get the trusted leadership advice you need to advance your career, develop your team, and grow your business.

","WEBVTT\n\n1\n00:00:00.000 --> 00:00:05.760\nWelcome to How Leaders Lead.\n\n2\n00:00:05.760 --> 00:00:09.160\nEvery week you get to listen in while I interview some of the very best leaders\n\n3\n00:00:09.160 --> 00:00:10.160\nin the world.\n\n4\n00:00:10.160 --> 00:00:13.410\nI break down the key learning so that by the end of the episode you'll have\n\n5\n00:00:13.410 --> 00:00:14.000\nsomething\n\n6\n00:00:14.000 --> 00:00:17.560\nsimple you can apply as you develop into a better leader.\n\n7\n00:00:17.560 --> 00:00:19.840\nThat's what this podcast is all about.\n\n8\n00:00:19.840 --> 00:00:23.960\nYou know, I think every good leader feels that pressure to deliver.\n\n9\n00:00:23.960 --> 00:00:26.720\nPeople want results and they want them now.\n\n10\n00:00:26.720 --> 00:00:29.980\nBut that can make it really easy to get short-sighted.\n\n11\n00:00:29.980 --> 00:00:33.560\nSometimes we don't really give ourselves permission to look down the road and\n\n12\n00:00:33.560 --> 00:00:33.840\nthink\n\n13\n00:00:33.840 --> 00:00:35.440\nabout the long term.\n\n14\n00:00:35.440 --> 00:00:39.220\nBut if you want success that's actually sustainable, you've got to learn how to\n\n15\n00:00:39.220 --> 00:00:39.980\ntake a longer\n\n16\n00:00:39.980 --> 00:00:41.400\nview of things.\n\n17\n00:00:41.400 --> 00:00:45.440\nAnd that's why I'm excited for you to hear from my guest today, David Solomon.\n\n18\n00:00:45.440 --> 00:00:49.040\nHe's the CEO of Goldman Sachs, one of the most renowned companies in the\n\n19\n00:00:49.040 --> 00:00:50.480\nfinancial industry.\n\n20\n00:00:50.480 --> 00:00:54.480\nNow look, David faces a lot of short-term pressures.\n\n21\n00:00:54.480 --> 00:00:58.720\nBut those don't keep him from looking ahead and taking a long-term approach.\n\n22\n00:00:58.720 --> 00:01:01.060\nOf course, that's never easy.\n\n23\n00:01:01.060 --> 00:01:03.060\nIt takes a heck of a lot of courage.\n\n24\n00:01:03.060 --> 00:01:06.280\nBut in this conversation, you're going to learn how it's done and why it's\n\n25\n00:01:06.280 --> 00:01:06.900\ncrucial for\n\n26\n00:01:06.900 --> 00:01:11.380\nany leader who wants to build trust and be a part of something that lasts.\n\n27\n00:01:11.380 --> 00:01:16.380\nPlus, David's got some insights into the economy that you do not want to miss.\n\n28\n00:01:16.380 --> 00:01:20.660\nHe explains from his perspective what's really been going on over the last few\n\n29\n00:01:20.660 --> 00:01:21.460\nyears and what\n\n30\n00:01:21.460 --> 00:01:24.620\nleaders need to be doing to prepare for what's coming.\n\n31\n00:01:24.620 --> 00:01:25.860\nSo let's jump right in.\n\n32\n00:01:25.860 --> 00:01:31.750\nHere's my conversation with my good friend, and soon to be yours, David Solomon\n\n33\n00:01:31.750 --> 00:01:32.100\n.\n\n34\n00:01:32.100 --> 00:01:38.040\nDavid, I always like to start out at the beginning.\n\n35\n00:01:38.040 --> 00:01:39.400\nTell us about your upbringing.\n\n36\n00:01:39.400 --> 00:01:40.400\nSure.\n\n37\n00:01:40.400 --> 00:01:44.230\nI grew up outside of New York City in Westchester County and Heart State, New\n\n38\n00:01:44.230 --> 00:01:44.680\nYork.\n\n39\n00:01:44.680 --> 00:01:48.140\nI went to public high school in that area.\n\n40\n00:01:48.140 --> 00:01:53.610\nMy father owned and ran with a partner, a financial printing business that was\n\n41\n00:01:53.610 --> 00:01:54.100\nbased\n\n42\n00:01:54.100 --> 00:01:56.420\nin Manhattan for most of my childhood.\n\n43\n00:01:56.420 --> 00:01:58.980\nMy mother was an audiologist.\n\n44\n00:01:58.980 --> 00:02:02.310\nShe had an audiology practice at the Berk Rehabilitation Hospital in White\n\n45\n00:02:02.310 --> 00:02:02.860\nPlains.\n\n46\n00:02:02.860 --> 00:02:07.340\nSo I would say it was a very middle-of-the-road, middle-class upbringing.\n\n47\n00:02:07.340 --> 00:02:12.320\nTell us about a story from your childhood days that probably shaped who you are\n\n48\n00:02:12.320 --> 00:02:13.020\ntoday.\n\n49\n00:02:13.020 --> 00:02:14.020\nSure.\n\n50\n00:02:14.020 --> 00:02:18.500\nWell, I'm asked often about people that have had a big influence, and certainly\n\n51\n00:02:18.500 --> 00:02:19.180\nmy parents\n\n52\n00:02:19.180 --> 00:02:20.940\nhad a very, very big influence.\n\n53\n00:02:20.940 --> 00:02:29.180\nMy mom had extraordinary drive and extraordinary capacity to handle a lot.\n\n54\n00:02:29.180 --> 00:02:31.300\nAnd my dad was just really a great mentor.\n\n55\n00:02:31.300 --> 00:02:36.630\nMy dad was someone who really believed that you didn't tell your kids what to\n\n56\n00:02:36.630 --> 00:02:37.100\ndo.\n\n57\n00:02:37.100 --> 00:02:40.980\nYou tried to give them a lot of rope, give them an opportunity to learn from\n\n58\n00:02:40.980 --> 00:02:42.140\ntheir mistakes,\n\n59\n00:02:42.140 --> 00:02:46.060\nand provide guidance and support as they navigated the world.\n\n60\n00:02:46.060 --> 00:02:50.020\nAnd there's a story I've told a handful of times just where I think my dad had\n\n61\n00:02:50.020 --> 00:02:50.700\na profound\n\n62\n00:02:50.700 --> 00:02:56.390\nimpact on how I've managed my life, and in particular my time professionally\n\n63\n00:02:56.390 --> 00:02:56.980\nover the\n\n64\n00:02:56.980 --> 00:02:58.420\nyears.\n\n65\n00:02:58.420 --> 00:03:01.880\nThis goes back to my being in high school and really having a lot of my plate\n\n66\n00:03:01.880 --> 00:03:02.660\nand complaining\n\n67\n00:03:02.660 --> 00:03:06.340\nto my father that I couldn't get it all done.\n\n68\n00:03:06.340 --> 00:03:10.680\nAnd he told me to take out a calendar, an old-classed calendar with big square\n\n69\n00:03:10.680 --> 00:03:11.140\nboxes\n\n70\n00:03:11.140 --> 00:03:12.140\nyou could write on.\n\n71\n00:03:12.140 --> 00:03:17.250\nAnd he said, \"Take the next month, and I want you to write down in each day\n\n72\n00:03:17.250 --> 00:03:17.700\neverything\n\n73\n00:03:17.700 --> 00:03:22.130\nyou have to do each day, including sleeping, eating, going to school, studying,\n\n74\n00:03:22.130 --> 00:03:22.620\netc.\n\n75\n00:03:22.620 --> 00:03:26.780\nTry to fill every minute of the day up and see where you wind up.\"\n\n76\n00:03:26.780 --> 00:03:31.140\nAnd what I discovered through that exercise was I spent a lot of time doing\n\n77\n00:03:31.140 --> 00:03:32.060\nnothing, sitting\n\n78\n00:03:32.060 --> 00:03:36.240\non the couch, watching television, just hanging out with my friends after\n\n79\n00:03:36.240 --> 00:03:36.900\nschool, and that\n\n80\n00:03:36.900 --> 00:03:40.840\nif you actually were thoughtful or purposeful with respect to how you'd spend\n\n81\n00:03:40.840 --> 00:03:41.580\nyour time,\n\n82\n00:03:41.580 --> 00:03:44.740\nthere actually was a lot of time in the day to get a lot done.\n\n83\n00:03:44.740 --> 00:03:49.580\nAnd that experience as a 17-year-old had a profound impact on my kind of re\n\n84\n00:03:49.580 --> 00:03:50.260\nthinking\n\n85\n00:03:50.260 --> 00:03:51.780\nhow I spend my time.\n\n86\n00:03:51.780 --> 00:03:53.780\nAnd I've carried it with me up till today.\n\n87\n00:03:53.780 --> 00:03:58.500\nI think you've got to be very purposeful in how you choose to spend your time.\n\n88\n00:03:58.500 --> 00:04:02.020\nAnd if you are, there's a lot of time to get a lot accomplished.\n\n89\n00:04:02.020 --> 00:04:03.020\nThat's great.\n\n90\n00:04:03.020 --> 00:04:05.580\nWhat did you want to be when you grew up when you were a kid?\n\n91\n00:04:05.580 --> 00:04:07.500\nDid you know what you wanted to be?\n\n92\n00:04:07.500 --> 00:04:11.540\nYou know, when I was really little, I wanted to be a garbage man.\n\n93\n00:04:11.540 --> 00:04:14.020\nThat's when I was really little, I used to stand on the corner and watch the\n\n94\n00:04:14.020 --> 00:04:14.380\ngarbage\n\n95\n00:04:14.380 --> 00:04:15.380\ntrucks go by.\n\n96\n00:04:15.380 --> 00:04:19.410\nBut I probably along the way, like most young boys growing up in the '60s\n\n97\n00:04:19.410 --> 00:04:20.220\nprobably want\n\n98\n00:04:20.220 --> 00:04:21.700\nto be a fireman at some point.\n\n99\n00:04:21.700 --> 00:04:25.800\nBut I think from a more reasonable perspective as I entered high school and\n\n100\n00:04:25.800 --> 00:04:26.620\ncollege, you\n\n101\n00:04:26.620 --> 00:04:27.900\nknow, I thought I would go to law school.\n\n102\n00:04:27.900 --> 00:04:32.940\nI always, for some reason, my parents, my mother in particular, really thought\n\n103\n00:04:32.940 --> 00:04:33.260\nat that\n\n104\n00:04:33.260 --> 00:04:35.740\npoint in time, you needed to be a professional.\n\n105\n00:04:35.740 --> 00:04:39.260\nAnd there were two kinds of professionals, doctors and lawyers.\n\n106\n00:04:39.260 --> 00:04:42.560\nAnd in that context, I just wasn't really that interested in the physical\n\n107\n00:04:42.560 --> 00:04:43.220\nsciences in\n\n108\n00:04:43.220 --> 00:04:44.220\nschool.\n\n109\n00:04:44.220 --> 00:04:46.620\nSo the law seemed more interesting.\n\n110\n00:04:46.620 --> 00:04:50.740\nBut somewhere along the way, it didn't pan out that way.\n\n111\n00:04:50.740 --> 00:04:55.020\nTell us about the moment you decided that you wanted to take the finance track.\n\n112\n00:04:55.020 --> 00:04:57.500\nDid you have that aha magic moment?\n\n113\n00:04:57.500 --> 00:05:02.580\nThe aha moment, they're tying it back to the story about going to law school.\n\n114\n00:05:02.580 --> 00:05:04.380\nI didn't do great on my law boards.\n\n115\n00:05:04.380 --> 00:05:06.820\nAnd probably I didn't do great on them because I was out the night before\n\n116\n00:05:06.820 --> 00:05:07.460\nhaving fun with\n\n117\n00:05:07.460 --> 00:05:12.220\nmy friends instead of, you know, being in studying or being more focused.\n\n118\n00:05:12.220 --> 00:05:14.580\nBut I didn't do great on my law boards.\n\n119\n00:05:14.580 --> 00:05:18.850\nAnd when it came time to apply to law school, I kind of looked at where I was\n\n120\n00:05:18.850 --> 00:05:19.580\nand I said,\n\n121\n00:05:19.580 --> 00:05:23.330\nyou know, I if I really want to really put the effort into this, I got to get\n\n122\n00:05:23.330 --> 00:05:24.140\nmore focused\n\n123\n00:05:24.140 --> 00:05:25.300\non it.\n\n124\n00:05:25.300 --> 00:05:26.500\nBut I need a job.\n\n125\n00:05:26.500 --> 00:05:28.180\nI'm getting out of school.\n\n126\n00:05:28.180 --> 00:05:31.540\nAnd at that point in time, you know, finance was just starting.\n\n127\n00:05:31.540 --> 00:05:33.380\nThis was 1983.\n\n128\n00:05:33.380 --> 00:05:37.380\nfinance was just starting to expand the amount of hiring it was starting to do\n\n129\n00:05:37.380 --> 00:05:38.180\nthe markets.\n\n130\n00:05:38.180 --> 00:05:40.420\nWe're starting to open up.\n\n131\n00:05:40.420 --> 00:05:44.000\nAnd a lot of banks were offering programs to come to New York and get some\n\n132\n00:05:44.000 --> 00:05:44.780\ntraining.\n\n133\n00:05:44.780 --> 00:05:48.380\nA bunch of my friends were moving in this direction.\n\n134\n00:05:48.380 --> 00:05:52.100\nAnd I kind of stumbled into it because it was an easy opportunity to stumble\n\n135\n00:05:52.100 --> 00:05:52.540\ninto.\n\n136\n00:05:52.540 --> 00:05:57.410\nAnd so I got a job out of school interviewing on campus at Hamilton College to\n\n137\n00:05:57.410 --> 00:05:57.940\ngo work for\n\n138\n00:05:57.940 --> 00:06:02.250\nthe Irving Trust Company, which was an, you know, an old line commercial bank\n\n139\n00:06:02.250 --> 00:06:02.660\nthat was\n\n140\n00:06:02.660 --> 00:06:04.180\nrunning a training program.\n\n141\n00:06:04.180 --> 00:06:09.260\nAnd I really didn't know a lot of what banking was or what finance would be.\n\n142\n00:06:09.260 --> 00:06:10.580\nBut it was a good job.\n\n143\n00:06:10.580 --> 00:06:15.660\nAnd off I went and got some training and that kind of started me on my way.\n\n144\n00:06:15.660 --> 00:06:19.460\nIs it something that you really enjoyed tremendously when you got into it?\n\n145\n00:06:19.460 --> 00:06:22.020\nWell, that's why I think it really, it really changed.\n\n146\n00:06:22.020 --> 00:06:25.260\nAnd I went to work at the Irving Trust Company and I went through the training\n\n147\n00:06:25.260 --> 00:06:25.580\nand there\n\n148\n00:06:25.580 --> 00:06:28.220\nwere things about finance that I discovered.\n\n149\n00:06:28.220 --> 00:06:32.180\nOh, I have a capacity or an interest in that got interesting.\n\n150\n00:06:32.180 --> 00:06:35.900\nBut I went through the training for a year and then I got placed in the bank.\n\n151\n00:06:35.900 --> 00:06:39.390\nAnd at that point in time is, you know, you'd well remember most people ought\n\n152\n00:06:39.390 --> 00:06:39.900\nto go back\n\n153\n00:06:39.900 --> 00:06:41.580\nto business school.\n\n154\n00:06:41.580 --> 00:06:44.620\nAnd so I was going through the process of applying a business school.\n\n155\n00:06:44.620 --> 00:06:51.460\nThis would have been in 1985, early 1986, when I got a job offer to go work at\n\n156\n00:06:51.460 --> 00:06:52.100\nDrexel\n\n157\n00:06:52.100 --> 00:06:53.300\nBurnham.\n\n158\n00:06:53.300 --> 00:06:55.340\nAnd so I looked at that job opportunity.\n\n159\n00:06:55.340 --> 00:06:58.020\nI was like, this is pretty interesting job opportunity.\n\n160\n00:06:58.020 --> 00:07:00.380\nDrexel was pretty visible and prominent.\n\n161\n00:07:00.380 --> 00:07:02.990\nWe all know the story of where it wound up, but it was pretty visible and\n\n162\n00:07:02.990 --> 00:07:03.580\nprominent on\n\n163\n00:07:03.580 --> 00:07:05.460\nthe rise then.\n\n164\n00:07:05.460 --> 00:07:08.820\nAnd I decided to take that opportunity and that opportunity kind of opened up\n\n165\n00:07:08.820 --> 00:07:09.180\nover the\n\n166\n00:07:09.180 --> 00:07:15.060\nnext five years, a great opportunity for me to really understand what it meant\n\n167\n00:07:15.060 --> 00:07:15.420\nto be\n\n168\n00:07:15.420 --> 00:07:16.420\nin the middle of finance.\n\n169\n00:07:16.420 --> 00:07:17.420\nI learned a lot.\n\n170\n00:07:17.420 --> 00:07:18.420\nI grew a lot.\n\n171\n00:07:18.420 --> 00:07:19.420\nI did very well.\n\n172\n00:07:19.420 --> 00:07:22.370\nAnd that was kind of the moment when I said, you know what, you know, I like\n\n173\n00:07:22.370 --> 00:07:22.820\nthis.\n\n174\n00:07:22.820 --> 00:07:25.660\nI think there's something here for me that's more meaningful.\n\n175\n00:07:25.660 --> 00:07:30.160\nNow, of course, in 1990, Drexel Burnham went out of business and I had skipped\n\n176\n00:07:30.160 --> 00:07:30.700\nbusiness\n\n177\n00:07:30.700 --> 00:07:32.820\nschool at that point in time.\n\n178\n00:07:32.820 --> 00:07:36.680\nSo you know, it was clear that I then had to navigate what was next, but I was\n\n179\n00:07:36.680 --> 00:07:37.140\npretty\n\n180\n00:07:37.140 --> 00:07:40.440\nhooked at the moment that I was going to pursue a career, finance at that point\n\n181\n00:07:40.440 --> 00:07:40.540\n.\n\n182\n00:07:40.540 --> 00:07:43.620\nI was in my late twenties and I was going to stay on that path.\n\n183\n00:07:43.620 --> 00:07:47.200\nYou know, people have to navigate their career in terms of what's next and you\n\n184\n00:07:47.200 --> 00:07:48.180\nhad this experience\n\n185\n00:07:48.180 --> 00:07:49.260\nat Drexel.\n\n186\n00:07:49.260 --> 00:07:53.000\nWhat process did you use or what advice could you give to someone on how to\n\n187\n00:07:53.000 --> 00:07:53.820\nnavigate what's\n\n188\n00:07:53.820 --> 00:07:57.440\nnext, where you go to, to leverage your skills and what you happen to really\n\n189\n00:07:57.440 --> 00:07:58.660\nlike doing?\n\n190\n00:07:58.660 --> 00:08:01.310\nYou know, it's interesting because one of the things that I see now is I have a\n\n191\n00:08:01.310 --> 00:08:01.540\nlot\n\n192\n00:08:01.540 --> 00:08:06.580\nof young people coming to me for advice and it feels to me like people are much\n\n193\n00:08:06.580 --> 00:08:07.060\nmore in\n\n194\n00:08:07.060 --> 00:08:12.650\na hurry to figure out what's the next step in their career as opposed to really\n\n195\n00:08:12.650 --> 00:08:13.620\nexperience\n\n196\n00:08:13.620 --> 00:08:15.900\nthe ride, you know, of their career.\n\n197\n00:08:15.900 --> 00:08:21.580\nBut I always try to advise people to think about one, are you learning?\n\n198\n00:08:21.580 --> 00:08:25.820\nAre you learning, growing, gaining skills and experience that are really adding\n\n199\n00:08:25.820 --> 00:08:26.180\nto what\n\n200\n00:08:26.180 --> 00:08:30.650\nyou know and are really broadening the lens that you look through\n\n201\n00:08:30.650 --> 00:08:32.140\nprofessionally?\n\n202\n00:08:32.140 --> 00:08:37.520\nTwo, are you working with people that you like and enjoy and are you creating a\n\n203\n00:08:37.520 --> 00:08:38.580\nprofessional\n\n204\n00:08:38.580 --> 00:08:43.860\nnetwork that you think is also, you know, opening up longer term opportunity\n\n205\n00:08:43.860 --> 00:08:44.580\nfor you?\n\n206\n00:08:44.580 --> 00:08:46.620\nAnd three, are you having some fun?\n\n207\n00:08:46.620 --> 00:08:51.540\nYou know, both on a day to day basis and, you know, with those people that are\n\n208\n00:08:51.540 --> 00:08:52.180\nreally an\n\n209\n00:08:52.180 --> 00:08:54.620\nimportant part of your life because you're spending a lot of time with them.\n\n210\n00:08:54.620 --> 00:08:59.650\nAnd if those three things are in place 60 to 70% of the time, it's probably a\n\n211\n00:08:59.650 --> 00:09:00.140\npretty\n\n212\n00:09:00.140 --> 00:09:02.940\ngood job, you know, ride it a little bit.\n\n213\n00:09:02.940 --> 00:09:06.400\nYou know, don't worry so much about what's next, but rather, you know, see what\n\n214\n00:09:06.400 --> 00:09:06.780\ncomes\n\n215\n00:09:06.780 --> 00:09:10.820\nyour way because you kind of stay put and develop some consistency in what you\n\n216\n00:09:10.820 --> 00:09:11.540\n're doing.\n\n217\n00:09:11.540 --> 00:09:15.920\nAnd so I'm a big believer in taking the long road, investing, good things\n\n218\n00:09:15.920 --> 00:09:16.580\nhappen when\n\n219\n00:09:16.580 --> 00:09:20.380\npeople, you know, take kind of a longer, slower perspective.\n\n220\n00:09:20.380 --> 00:09:23.100\nI'm a little bit of a tortoise as opposed to a hair.\n\n221\n00:09:23.100 --> 00:09:25.900\nWhat came your way after Drexel that excited you?\n\n222\n00:09:25.900 --> 00:09:27.780\nWell, I found my way to bear stones.\n\n223\n00:09:27.780 --> 00:09:30.760\nAnd by the way, you know, there's no pattern developing because, you know, two\n\n224\n00:09:30.760 --> 00:09:31.420\ninstitutions\n\n225\n00:09:31.420 --> 00:09:33.220\nthat are no longer around today.\n\n226\n00:09:33.220 --> 00:09:37.520\nBut I found my way to bear stones and had a very interesting run for eight or\n\n227\n00:09:37.520 --> 00:09:38.140\nnine years\n\n228\n00:09:38.140 --> 00:09:43.380\nat Bear Stearns through the nineties where because of some of the skills and\n\n229\n00:09:43.380 --> 00:09:44.140\nautonomy\n\n230\n00:09:44.140 --> 00:09:49.430\nand the entrepreneurial nature of the industry at the time, it really was an\n\n231\n00:09:49.430 --> 00:09:50.500\nindustry that\n\n232\n00:09:50.500 --> 00:09:53.140\nwas driven by what you produced.\n\n233\n00:09:53.140 --> 00:09:56.440\nAnd you know, I became a relatively big producer in Bear Stearns in my early th\n\n234\n00:09:56.440 --> 00:09:57.100\nirties in the\n\n235\n00:09:57.100 --> 00:10:01.460\nearly nineties and rose to the top of that organization.\n\n236\n00:10:01.460 --> 00:10:04.580\nAnd by my mid thirties, I was on the management committee of that organization\n\n237\n00:10:04.580 --> 00:10:05.340\nand was running\n\n238\n00:10:05.340 --> 00:10:08.490\nthe investment banking business there, small investment banking business\n\n239\n00:10:08.490 --> 00:10:09.420\ncompared to Goldman\n\n240\n00:10:09.420 --> 00:10:13.360\nSachs, but I started to have some real success and get some real visibility\n\n241\n00:10:13.360 --> 00:10:14.700\naround the industry.\n\n242\n00:10:14.700 --> 00:10:19.670\nAnd it was through that that in 1999, Goldman Sachs came to recruit me to\n\n243\n00:10:19.670 --> 00:10:20.740\nGoldman Sachs,\n\n244\n00:10:20.740 --> 00:10:23.680\nyou know, given some of the interactions I had with the firm during my\n\n245\n00:10:23.680 --> 00:10:24.660\nexperience there.\n\n246\n00:10:24.660 --> 00:10:27.980\nYou want to ask yourself that you mentioned you didn't have an MBA.\n\n247\n00:10:27.980 --> 00:10:31.180\nHow much anxiety did that create for you when you're coming up in a world where\n\n248\n00:10:31.180 --> 00:10:31.660\neverybody\n\n249\n00:10:31.660 --> 00:10:32.900\nseems to have an MBA?\n\n250\n00:10:32.900 --> 00:10:39.400\nI mean, that's a very insightful question and the honest answer is at the time\n\n251\n00:10:39.400 --> 00:10:40.180\na lot.\n\n252\n00:10:40.180 --> 00:10:44.300\nIt didn't seem like an inappropriate choice when I was working at Drexel and\n\n253\n00:10:44.300 --> 00:10:44.940\neverything\n\n254\n00:10:44.940 --> 00:10:50.550\nwas working and I was ahead of and making more money than my peers who were\n\n255\n00:10:50.550 --> 00:10:51.300\ngoing to\n\n256\n00:10:51.300 --> 00:10:54.100\nbusiness school or just coming out of business school.\n\n257\n00:10:54.100 --> 00:10:58.290\nBut when Drexel went out of business and I started interviewing for jobs, I\n\n258\n00:10:58.290 --> 00:10:58.820\nfelt it\n\n259\n00:10:58.820 --> 00:11:04.260\nand it made me nervous and I think it affected the choices that were available\n\n260\n00:11:04.260 --> 00:11:04.940\nto me.\n\n261\n00:11:04.940 --> 00:11:10.740\nI think if being in my late 20s and not having an MBA limited at that time some\n\n262\n00:11:10.740 --> 00:11:11.460\nof the choices\n\n263\n00:11:11.460 --> 00:11:16.330\nthat were available to me, I obviously landed on my feet and found my way and\n\n264\n00:11:16.330 --> 00:11:17.220\nultimately\n\n265\n00:11:17.220 --> 00:11:23.050\nand I think this is really true, ultimately experience and credibility became\n\n266\n00:11:23.050 --> 00:11:23.980\nmore important\n\n267\n00:11:23.980 --> 00:11:26.660\nthan what schools I went to or what degrees I had.\n\n268\n00:11:26.660 --> 00:11:29.890\nBut at the time I remember being nervous about it and I do think that's been\n\n269\n00:11:29.890 --> 00:11:30.460\ntempered.\n\n270\n00:11:30.460 --> 00:11:31.980\nI think the world is much more open.\n\n271\n00:11:31.980 --> 00:11:35.800\nI think a place like Goldman Sachs is much more open than it used to be and in\n\n272\n00:11:35.800 --> 00:11:36.340\nfact not\n\n273\n00:11:36.340 --> 00:11:40.720\nonly are we more open from a diversity perspective, we want people from a much\n\n274\n00:11:40.720 --> 00:11:41.460\nbroader array\n\n275\n00:11:41.460 --> 00:11:45.870\nof schools and experiences in the organization than the organization did 20\n\n276\n00:11:45.870 --> 00:11:46.660\nyears ago.\n\n277\n00:11:46.660 --> 00:11:48.940\nBut at the time that felt like a limiting thing.\n\n278\n00:11:48.940 --> 00:11:51.100\nIt was a less traditional path.\n\n279\n00:11:51.100 --> 00:11:54.020\nCertainly in my generation it was a less traditional path.\n\n280\n00:11:54.020 --> 00:11:56.940\nBut you leverage your experience, you were a producer, you brought forward the\n\n281\n00:11:56.940 --> 00:11:57.940\ngreat results\n\n282\n00:11:57.940 --> 00:12:01.540\nand you were a very senior position at Bear Stearns.\n\n283\n00:12:01.540 --> 00:12:05.770\nWhat made you ultimately make the move to Goldman Sachs which is at a senior\n\n284\n00:12:05.770 --> 00:12:06.300\nlevel I\n\n285\n00:12:06.300 --> 00:12:09.300\nknow doesn't happen very often.\n\n286\n00:12:09.300 --> 00:12:12.750\nWhat was unusual, it happens a little bit more today but at the time I was\n\n287\n00:12:12.750 --> 00:12:13.220\nhired as a\n\n288\n00:12:13.220 --> 00:12:17.420\npartner at Goldman Sachs in 1999 and at the time that was something that the\n\n289\n00:12:17.420 --> 00:12:17.900\nfirm did\n\n290\n00:12:17.900 --> 00:12:18.900\nnot do that often.\n\n291\n00:12:18.900 --> 00:12:23.110\nBut I think the leadership of the firm at the time, Hank Paulson at the time it\n\n292\n00:12:23.110 --> 00:12:23.700\nwas John\n\n293\n00:12:23.700 --> 00:12:25.700\nThornton and John Thane working for Hank.\n\n294\n00:12:25.700 --> 00:12:30.340\nThey really thought that the firm was going to become a public company.\n\n295\n00:12:30.340 --> 00:12:34.880\nIt was becoming a much broader, more global business and the firm would benefit\n\n296\n00:12:34.880 --> 00:12:35.260\nfrom\n\n297\n00:12:35.260 --> 00:12:39.550\na diversity of experience and actually having some people that hadn't grown up\n\n298\n00:12:39.550 --> 00:12:39.860\nstarting\n\n299\n00:12:39.860 --> 00:12:42.820\nright out of school inside the firm.\n\n300\n00:12:42.820 --> 00:12:46.900\nAnd so at the time the firm went out higher to handful of people as partners\n\n301\n00:12:46.900 --> 00:12:47.460\nand I got\n\n302\n00:12:47.460 --> 00:12:50.180\nswept in in the context of that.\n\n303\n00:12:50.180 --> 00:12:55.700\nSo it was unusual but it was also, and again this goes to the long term\n\n304\n00:12:55.700 --> 00:12:56.860\nthinking.\n\n305\n00:12:56.860 --> 00:13:01.660\nGoldman just had in my own mind such a place in the industry that it was kind\n\n306\n00:13:01.660 --> 00:13:02.340\nof like an\n\n307\n00:13:02.340 --> 00:13:04.420\nopportunity to play for the Yankees.\n\n308\n00:13:04.420 --> 00:13:06.740\nAnd I was 37 years old at the time.\n\n309\n00:13:06.740 --> 00:13:12.420\nI really loved the industry and was kind of committed to a career in it.\n\n310\n00:13:12.420 --> 00:13:15.570\nI saw this as an opportunity to really go work with the best and the brightest\n\n311\n00:13:15.570 --> 00:13:16.540\nbut it required\n\n312\n00:13:16.540 --> 00:13:20.220\nme to take a step back professionally.\n\n313\n00:13:20.220 --> 00:13:21.980\nI was on the management committee for firm.\n\n314\n00:13:21.980 --> 00:13:27.880\nI had a very, very big job and I went to run a business that I had run, it was\n\n315\n00:13:27.880 --> 00:13:28.380\nbigger\n\n316\n00:13:28.380 --> 00:13:31.460\nthan the one at Bear Stearns but it was a business I had run seven years\n\n317\n00:13:31.460 --> 00:13:32.100\nearlier.\n\n318\n00:13:32.100 --> 00:13:37.020\nAnd I started at a lower position in the partnership but I decided you know\n\n319\n00:13:37.020 --> 00:13:37.660\nwhat, this\n\n320\n00:13:37.660 --> 00:13:41.100\nis something that I think will be good for me with a long term view.\n\n321\n00:13:41.100 --> 00:13:43.260\nAnd it turned out to be a wise decision.\n\n322\n00:13:43.260 --> 00:13:46.880\nAbsolutely, you know, you had, obviously you had senior sponsorship, you know,\n\n323\n00:13:46.880 --> 00:13:47.260\nwhen you\n\n324\n00:13:47.260 --> 00:13:51.460\nbrought in as a partner but you come in as an outsider in a company that didn't\n\n325\n00:13:51.460 --> 00:13:51.900\nreally\n\n326\n00:13:51.900 --> 00:13:54.260\nbring in partners from the outside.\n\n327\n00:13:54.260 --> 00:13:57.100\nHow did your peers view you and other people in the company?\n\n328\n00:13:57.100 --> 00:13:58.100\nWas that hard for you?\n\n329\n00:13:58.100 --> 00:13:59.100\nHow did you adjust to that?\n\n330\n00:13:59.100 --> 00:14:02.900\nYou know, I think that actually turned out to be easier than I expected.\n\n331\n00:14:02.900 --> 00:14:07.470\nYou know, the culture here is extremely collaborative and I remember at the\n\n332\n00:14:07.470 --> 00:14:08.620\ntime feeling really\n\n333\n00:14:08.620 --> 00:14:10.060\nembraced and really open.\n\n334\n00:14:10.060 --> 00:14:13.300\nI think there was an ethos here in the partnership at the firm that we weren't\n\n335\n00:14:13.300 --> 00:14:14.060\ngoing to do that\n\n336\n00:14:14.060 --> 00:14:17.960\noften but when we did choose to do it, if we chose to do it, we were really\n\n337\n00:14:17.960 --> 00:14:18.460\ngoing to\n\n338\n00:14:18.460 --> 00:14:21.710\nembrace those people and make sure it worked because if we didn't embrace them\n\n339\n00:14:21.710 --> 00:14:22.300\nand it didn't\n\n340\n00:14:22.300 --> 00:14:26.540\nwork, you know, we'd lose that, you know, that ability to attract people.\n\n341\n00:14:26.540 --> 00:14:30.250\nNow in the context of bringing people along, I think I interviewed with 20 or\n\n342\n00:14:30.250 --> 00:14:31.100\n25 partners\n\n343\n00:14:31.100 --> 00:14:32.500\nbefore I was hired.\n\n344\n00:14:32.500 --> 00:14:35.310\nSo there's certainly a lot of people that I spent time with and felt some\n\n345\n00:14:35.310 --> 00:14:35.940\nconnection\n\n346\n00:14:35.940 --> 00:14:39.140\nor ownership but I, and actually went better than I thought although the one\n\n347\n00:14:39.140 --> 00:14:39.660\nthing I would\n\n348\n00:14:39.660 --> 00:14:43.650\nhighlight, whenever the partnership got together, they used to grab us and they\n\n349\n00:14:43.650 --> 00:14:44.300\n'd say, \"Let's\n\n350\n00:14:44.300 --> 00:14:45.460\nget the outsiders.\n\n351\n00:14:45.460 --> 00:14:48.900\nLet's get the lateral hires and let's get them to talk about what's different\n\n352\n00:14:48.900 --> 00:14:49.260\nabout\n\n353\n00:14:49.260 --> 00:14:50.500\nthis.\"\n\n354\n00:14:50.500 --> 00:14:54.470\nAnd you know, I sat on those panels for 10 or 15 years before finally it\n\n355\n00:14:54.470 --> 00:14:55.260\nprogressed.\n\n356\n00:14:55.260 --> 00:14:57.660\nI was, you know, I was no longer a lateral hire.\n\n357\n00:14:57.660 --> 00:14:59.820\nIt took you a while to be an insulator.\n\n358\n00:14:59.820 --> 00:15:03.690\nAlthough still today, still today I am the CEO but a lot of people walk around,\n\n359\n00:15:03.690 --> 00:15:04.140\nyou're\n\n360\n00:15:04.140 --> 00:15:06.020\nthe CEO who was a lateral hire.\n\n361\n00:15:06.020 --> 00:15:11.020\nSo, you know, I don't think you ever lose that moniker or a Goldman Sachs.\n\n362\n00:15:11.020 --> 00:15:16.330\nNow, you listen to this podcast so you know how much I love learning about\n\n363\n00:15:16.330 --> 00:15:17.300\nleadership\n\n364\n00:15:17.300 --> 00:15:19.780\nfrom some of the world's greatest leaders.\n\n365\n00:15:19.780 --> 00:15:23.800\nWe make it a priority to break down the insights from our guests into practical\n\n366\n00:15:23.800 --> 00:15:24.540\nsteps so you\n\n367\n00:15:24.540 --> 00:15:30.140\ncan apply what you learn from our episodes into your own leadership style.\n\n368\n00:15:30.140 --> 00:15:34.880\nA lot of times though, it can be easy to listen to an episode and forget what\n\n369\n00:15:34.880 --> 00:15:35.840\nyou learn.\n\n370\n00:15:35.840 --> 00:15:40.120\nThat is exactly why I created the weekly leadership plan.\n\n371\n00:15:40.120 --> 00:15:44.570\nEvery Sunday, I send out a weekly leadership plan that lays out in three simple\n\n372\n00:15:44.570 --> 00:15:45.180\nsteps the\n\n373\n00:15:45.180 --> 00:15:47.940\nkey learnings from that week's podcast.\n\n374\n00:15:47.940 --> 00:15:52.220\nIt only takes about five minutes to read and it gives you practical steps you\n\n375\n00:15:52.220 --> 00:15:52.800\ncan apply\n\n376\n00:15:52.800 --> 00:15:55.800\nto your leadership process for that week.\n\n377\n00:15:55.800 --> 00:16:00.050\nLike everything we do at Hal leaders lead, it's completely free and you can\n\n378\n00:16:00.050 --> 00:16:00.820\nsign up for\n\n379\n00:16:00.820 --> 00:16:04.260\nit at halleaderslead.com right now.\n\n380\n00:16:04.260 --> 00:16:08.600\nThis weekly leadership plan is a great way to prepare for your week each Sunday\n\n381\n00:16:08.600 --> 00:16:09.120\nevening\n\n382\n00:16:09.120 --> 00:16:15.120\nand I hope you'll sign up today at halleaderslead.com/plan.\n\n383\n00:16:15.120 --> 00:16:23.850\nYou know, when you left Bear Stearns, did you learn anything from that\n\n384\n00:16:23.850 --> 00:16:25.760\nexperience that\n\n385\n00:16:25.760 --> 00:16:29.680\nyou think about, you know, when you're dealing with people and managing people\n\n386\n00:16:29.680 --> 00:16:30.360\nand trying\n\n387\n00:16:30.360 --> 00:16:32.080\nto keep your highest performance?\n\n388\n00:16:32.080 --> 00:16:34.940\nBecause obviously, Bear Stearns did not want to lose you.\n\n389\n00:16:34.940 --> 00:16:37.160\nYou were at the highest ranks of the company.\n\n390\n00:16:37.160 --> 00:16:42.100\nSo did you learn anything that allows you to manage or helps you manage the\n\n391\n00:16:42.100 --> 00:16:42.960\nreally top\n\n392\n00:16:42.960 --> 00:16:43.960\nperformers better?\n\n393\n00:16:43.960 --> 00:16:47.590\nWell, the real contrast to Bear Stearns, the way Bear Stearns operated and\n\n394\n00:16:47.590 --> 00:16:48.480\nGoldman Sachs\n\n395\n00:16:48.480 --> 00:16:51.870\nand the way Goldman Sachs operated and it's actually, I think, one of the\n\n396\n00:16:51.870 --> 00:16:52.520\nreasons.\n\n397\n00:16:52.520 --> 00:16:56.210\nI mean, Bear Stearns was around for a long time, but it's not around today and\n\n398\n00:16:56.210 --> 00:16:56.740\nGoldman\n\n399\n00:16:56.740 --> 00:16:59.580\nSachs has been around a long time and it is around today.\n\n400\n00:16:59.580 --> 00:17:06.150\nAnd, you know, Bear Stearns never made the transition from being a very tightly\n\n401\n00:17:06.150 --> 00:17:06.580\ncontrolled\n\n402\n00:17:06.580 --> 00:17:09.720\npartnership to an institutional firm.\n\n403\n00:17:09.720 --> 00:17:13.640\nAnd while Goldman Sachs always retained the partnership culture, it really\n\n404\n00:17:13.640 --> 00:17:14.780\nspread out decision\n\n405\n00:17:14.780 --> 00:17:19.570\nmaking authority and really held people accountable in a very horizontal,\n\n406\n00:17:19.570 --> 00:17:22.200\ncollaborative way.\n\n407\n00:17:22.200 --> 00:17:24.280\nAnd you know, Bear Stearns didn't do that.\n\n408\n00:17:24.280 --> 00:17:26.440\nBear Stearns was run by a handful of people.\n\n409\n00:17:26.440 --> 00:17:30.330\nIt was extremely tight and as a result, you were either in this very, very\n\n410\n00:17:30.330 --> 00:17:31.100\nsmall group\n\n411\n00:17:31.100 --> 00:17:32.260\nor you weren't.\n\n412\n00:17:32.260 --> 00:17:35.610\nIt seemed to work fine when I was there, but I could really see the contrast in\n\n413\n00:17:35.610 --> 00:17:36.440\na collaborative\n\n414\n00:17:36.440 --> 00:17:40.400\npartnership culture where you're really trying to empower the organization in a\n\n415\n00:17:40.400 --> 00:17:41.100\nhorizontal\n\n416\n00:17:41.100 --> 00:17:42.100\nway.\n\n417\n00:17:42.100 --> 00:17:46.680\nAnd, you know, I think I learned that in these kinds of professional services,\n\n418\n00:17:46.680 --> 00:17:47.800\nbusinesses,\n\n419\n00:17:47.800 --> 00:17:50.180\nthat empowerment is super important.\n\n420\n00:17:50.180 --> 00:17:55.170\nI'd also say one of the things culturally that this firm has excelled at is\n\n421\n00:17:55.170 --> 00:17:55.460\nthere's\n\n422\n00:17:55.460 --> 00:18:00.710\na deeply rooted culture of risk management that really empowers the control\n\n423\n00:18:00.710 --> 00:18:01.360\nside of the\n\n424\n00:18:01.360 --> 00:18:06.280\nfirm to have an equal balance with the producing side of the firm.\n\n425\n00:18:06.280 --> 00:18:09.280\nAnd I think that matters in the sustainability of these organizations.\n\n426\n00:18:09.280 --> 00:18:12.360\nAnd so that's something else that I'd observed that was different than I think\n\n427\n00:18:12.360 --> 00:18:12.880\nhas been a\n\n428\n00:18:12.880 --> 00:18:15.280\nreal attribute of this platform.\n\n429\n00:18:15.280 --> 00:18:20.040\nDavid, you followed some really legendary leaders and CEOs at Goldman.\n\n430\n00:18:20.040 --> 00:18:24.020\nYou know, what do you think are the defining qualities of the best leaders who\n\n431\n00:18:24.020 --> 00:18:24.560\nhave led\n\n432\n00:18:24.560 --> 00:18:25.560\nthe firm?\n\n433\n00:18:25.560 --> 00:18:28.960\nWell, as people, they're all, we're all different.\n\n434\n00:18:28.960 --> 00:18:32.890\nI was going to say they're all different, but now I guess I can include myself\n\n435\n00:18:32.890 --> 00:18:33.340\nin that\n\n436\n00:18:33.340 --> 00:18:37.150\none-gust group, although I certainly have a lot of work to do to earn their\n\n437\n00:18:37.150 --> 00:18:37.860\nstanding.\n\n438\n00:18:37.860 --> 00:18:43.360\nAs people were all different, but I do think there are a handful of things that\n\n439\n00:18:43.360 --> 00:18:44.160\neven though\n\n440\n00:18:44.160 --> 00:18:47.230\nthe styles can be different, their core to successful leadership in an\n\n441\n00:18:47.230 --> 00:18:48.120\norganization like\n\n442\n00:18:48.120 --> 00:18:52.000\nthis, the first is you've got to bring people along with you.\n\n443\n00:18:52.000 --> 00:18:58.070\nAnd you've got to find a way to communicate your vision and get people to\n\n444\n00:18:58.070 --> 00:18:59.200\nexchange an\n\n445\n00:18:59.200 --> 00:19:03.380\nopen debate, an open challenge, but ultimately arrive at a conclusion as to the\n\n446\n00:19:03.380 --> 00:19:04.040\ndirection\n\n447\n00:19:04.040 --> 00:19:06.920\nthat you're going to go and want to go with you.\n\n448\n00:19:06.920 --> 00:19:12.270\nAnd whether it's been Hank or it's been Lloyd or even many before that, this\n\n449\n00:19:12.270 --> 00:19:13.360\norganization\n\n450\n00:19:13.360 --> 00:19:19.020\noperates in a collaborative way that encourages open challenge, but also the\n\n451\n00:19:19.020 --> 00:19:20.200\nneed for people\n\n452\n00:19:20.200 --> 00:19:21.560\nto come along.\n\n453\n00:19:21.560 --> 00:19:25.440\nAnd I think that's a very important aspect of leadership.\n\n454\n00:19:25.440 --> 00:19:30.100\nI think in the world we live in today, transparency and communication are\n\n455\n00:19:30.100 --> 00:19:31.760\nincreasingly important\n\n456\n00:19:31.760 --> 00:19:33.280\non the part of leaders.\n\n457\n00:19:33.280 --> 00:19:38.530\nAnd you've got to be able to get your messages out in a real-time basis much\n\n458\n00:19:38.530 --> 00:19:39.640\nmore frequently\n\n459\n00:19:39.640 --> 00:19:41.200\nthan you used to.\n\n460\n00:19:41.200 --> 00:19:45.000\nThe transparency with respect to everything you do and everything that you say\n\n461\n00:19:45.000 --> 00:19:45.440\nis much,\n\n462\n00:19:45.440 --> 00:19:46.920\nmuch higher.\n\n463\n00:19:46.920 --> 00:19:49.940\nAnd so I think you've got to be very, very thoughtful in your whole\n\n464\n00:19:49.940 --> 00:19:51.200\ncommunication strategy\n\n465\n00:19:51.200 --> 00:19:54.760\nand the way you make sure people understand the direction that you want the\n\n466\n00:19:54.760 --> 00:19:55.520\norganization\n\n467\n00:19:55.520 --> 00:19:56.520\nto go.\n\n468\n00:19:56.520 --> 00:19:58.720\nAnd last, I think is the world shifting.\n\n469\n00:19:58.720 --> 00:20:01.840\nAnd you can look at Goldman Sachs as an example of this.\n\n470\n00:20:01.840 --> 00:20:08.890\n60% of the employees here are 30 years old or less, 74% are millennial or Gen Z\n\n471\n00:20:08.890 --> 00:20:09.160\n.\n\n472\n00:20:09.160 --> 00:20:14.280\nThey want to see people as human beings, as authentic in their leadership.\n\n473\n00:20:14.280 --> 00:20:19.970\nAnd I think you just have to be much more open as a person to successfully get\n\n474\n00:20:19.970 --> 00:20:21.040\nthe younger\n\n475\n00:20:21.040 --> 00:20:25.460\ngeneration that's coming up in these organizations to want to be a part of it.\n\n476\n00:20:25.460 --> 00:20:28.480\nAnd they want to know what you stand for and who you are, not just what you're\n\n477\n00:20:28.480 --> 00:20:28.880\ndoing in\n\n478\n00:20:28.880 --> 00:20:30.080\nthe company.\n\n479\n00:20:30.080 --> 00:20:31.840\nYou do a lot of innovative things on that front.\n\n480\n00:20:31.840 --> 00:20:34.440\nI want to get to that a little bit later.\n\n481\n00:20:34.440 --> 00:20:38.710\nI remember that the late John Weinberg, he was former partner, he was on our\n\n482\n00:20:38.710 --> 00:20:39.440\nYoung Brands\n\n483\n00:20:39.440 --> 00:20:40.440\nBoard.\n\n484\n00:20:40.440 --> 00:20:44.300\nI remember him being, and you came in as a partner, but I remember him being\n\n485\n00:20:44.300 --> 00:20:45.160\nvery concerned\n\n486\n00:20:45.160 --> 00:20:50.360\nabout Goldman moving from a partnership model to a public company.\n\n487\n00:20:50.360 --> 00:20:53.200\nHow do you think that's worked out?\n\n488\n00:20:53.200 --> 00:20:58.850\nWell, I understand why John Weinberg had concerns because it's such a core part\n\n489\n00:20:58.850 --> 00:20:59.520\nof what Goldman\n\n490\n00:20:59.520 --> 00:21:00.520\nSachs was.\n\n491\n00:21:00.520 --> 00:21:04.780\nAnd Goldman Sachs held off longer than anyone else because all these businesses\n\n492\n00:21:04.780 --> 00:21:05.800\nwere partnership\n\n493\n00:21:05.800 --> 00:21:08.040\nstructures at one point.\n\n494\n00:21:08.040 --> 00:21:13.090\nGoldman Sachs held off longer than anyone else in terms of making the switch to\n\n495\n00:21:13.090 --> 00:21:13.560\nbeing\n\n496\n00:21:13.560 --> 00:21:14.720\na public company.\n\n497\n00:21:14.720 --> 00:21:19.000\nBut what I'd have to say is I think it worked out very well because Goldman\n\n498\n00:21:19.000 --> 00:21:19.760\nSachs wouldn't\n\n499\n00:21:19.760 --> 00:21:21.720\nbe Goldman Sachs if it hadn't gone public.\n\n500\n00:21:21.720 --> 00:21:25.770\nThe world changed the amount of capital that was necessary in these businesses\n\n501\n00:21:25.770 --> 00:21:26.400\nto compete\n\n502\n00:21:26.400 --> 00:21:29.120\non a global scale changed.\n\n503\n00:21:29.120 --> 00:21:33.950\nAnd there was no way that you could operate at a global scale in these\n\n504\n00:21:33.950 --> 00:21:35.520\nbusinesses without\n\n505\n00:21:35.520 --> 00:21:36.880\nbeing a public company.\n\n506\n00:21:36.880 --> 00:21:38.680\nYour capital was not going to sustain it.\n\n507\n00:21:38.680 --> 00:21:44.400\nSo the choice became being a smaller niche organization or being a true global\n\n508\n00:21:44.400 --> 00:21:45.120\nplayer.\n\n509\n00:21:45.120 --> 00:21:47.440\nWe chose being a true global player.\n\n510\n00:21:47.440 --> 00:21:50.240\nAnd it was that transition that allowed that.\n\n511\n00:21:50.240 --> 00:21:54.580\nI think the thing that we have done that's unique is unlike any other\n\n512\n00:21:54.580 --> 00:21:56.040\norganization, we've\n\n513\n00:21:56.040 --> 00:21:58.480\nretained the partnership in a public company structure.\n\n514\n00:21:58.480 --> 00:22:01.120\nAnd I think it's been a huge asset to the firm.\n\n515\n00:22:01.120 --> 00:22:06.950\nYou know, Goldman Sachs is probably most famous for its historical client first\n\n516\n00:22:06.950 --> 00:22:07.840\nculture.\n\n517\n00:22:07.840 --> 00:22:12.110\nIt's not so much about the individual, but all about bringing a team together\n\n518\n00:22:12.110 --> 00:22:12.600\nto find\n\n519\n00:22:12.600 --> 00:22:15.040\nthe right answer for the client.\n\n520\n00:22:15.040 --> 00:22:18.280\nHow would you describe that culture today?\n\n521\n00:22:18.280 --> 00:22:21.560\nAnd what are you really trying to do to evolve the culture to make the firm\n\n522\n00:22:21.560 --> 00:22:22.880\neven more successful?\n\n523\n00:22:22.880 --> 00:22:23.880\nYeah.\n\n524\n00:22:23.880 --> 00:22:28.000\nSo it's still a hugely important part of the culture of the organization.\n\n525\n00:22:28.000 --> 00:22:33.130\nAnd I'd say that focus on the client and really thinking about the client's\n\n526\n00:22:33.130 --> 00:22:33.960\ninterests\n\n527\n00:22:33.960 --> 00:22:36.600\nis the true north of this organization.\n\n528\n00:22:36.600 --> 00:22:41.030\nIt's always been important, but I think the big thing that we're focused on now\n\n529\n00:22:41.030 --> 00:22:41.800\nand really\n\n530\n00:22:41.800 --> 00:22:47.320\nI've been trying to emphasize is the idea of delivering the whole firm to our\n\n531\n00:22:47.320 --> 00:22:48.080\nclients\n\n532\n00:22:48.080 --> 00:22:50.200\nin a much more unified way.\n\n533\n00:22:50.200 --> 00:22:54.160\nSo when you were young as the CEO of young brands, you generally dealt with our\n\n534\n00:22:54.160 --> 00:22:54.880\ninvestment\n\n535\n00:22:54.880 --> 00:22:56.360\nbanking business.\n\n536\n00:22:56.360 --> 00:23:00.320\nBut as the world's got more complicated, we have a lot of clients on a global\n\n537\n00:23:00.320 --> 00:23:01.000\nbasis that\n\n538\n00:23:01.000 --> 00:23:05.690\ndeal with us across investment banking, across our market making businesses,\n\n539\n00:23:05.690 --> 00:23:06.440\nacross our asset\n\n540\n00:23:06.440 --> 00:23:10.490\nmanagement business, and that integration and the way we deliver that for a\n\n541\n00:23:10.490 --> 00:23:11.200\nlong time,\n\n542\n00:23:11.200 --> 00:23:13.560\nthe firm really ran in divisions.\n\n543\n00:23:13.560 --> 00:23:17.070\nAnd you dealt even though there was a team approach in that division, you\n\n544\n00:23:17.070 --> 00:23:17.840\nreally dealt\n\n545\n00:23:17.840 --> 00:23:20.040\nin silos in the firm.\n\n546\n00:23:20.040 --> 00:23:23.940\nAnd so we've been really talking about one GS is core to our culture going\n\n547\n00:23:23.940 --> 00:23:24.680\nforward.\n\n548\n00:23:24.680 --> 00:23:28.500\nHow do we deliver the entire organization to our clients and really get focused\n\n549\n00:23:28.500 --> 00:23:28.920\non how\n\n550\n00:23:28.920 --> 00:23:34.760\nour clients experience the firm as opposed to how do we approach our clients?\n\n551\n00:23:34.760 --> 00:23:39.750\nAnd we've been trying to really wrestle with ways to make that as positive an\n\n552\n00:23:39.750 --> 00:23:40.600\nexperience\n\n553\n00:23:40.600 --> 00:23:43.880\nfor our clients so they can get what they need out of the firm as possible.\n\n554\n00:23:43.880 --> 00:23:47.320\nAnd that's really the true north of the organization at this point.\n\n555\n00:23:47.320 --> 00:23:51.020\nYou know, as a relatively new CEO, you've already built a reputation for being\n\n556\n00:23:51.020 --> 00:23:51.560\nstrategic\n\n557\n00:23:51.560 --> 00:23:53.400\nand in long term focused.\n\n558\n00:23:53.400 --> 00:23:56.310\nAnd I always know the people I worked with at Goldman talked about Goldman\n\n559\n00:23:56.310 --> 00:23:56.920\nSachs being\n\n560\n00:23:56.920 --> 00:23:59.080\nlong term greedy.\n\n561\n00:23:59.080 --> 00:24:02.330\nAnd here you are, you're running this public company where you got to deliver\n\n562\n00:24:02.330 --> 00:24:03.040\nthe quarterly\n\n563\n00:24:03.040 --> 00:24:04.040\nresults.\n\n564\n00:24:04.040 --> 00:24:07.910\nCan you really be long term greedy and run such a transactional business where\n\n565\n00:24:07.910 --> 00:24:08.440\nthe stock\n\n566\n00:24:08.440 --> 00:24:09.440\ngoes up and down?\n\n567\n00:24:09.440 --> 00:24:11.160\nAnd how do you deal with that?\n\n568\n00:24:11.160 --> 00:24:14.560\nWell, I mean, I'd start by the fact I know that's a very famous long time\n\n569\n00:24:14.560 --> 00:24:15.440\nGoldman Sachs\n\n570\n00:24:15.440 --> 00:24:18.920\nexpression, but I'd say I don't like that expression.\n\n571\n00:24:18.920 --> 00:24:23.730\nAnd there's a connotation to it that I think I'd use different words in\n\n572\n00:24:23.730 --> 00:24:25.200\ndescribing how\n\n573\n00:24:25.200 --> 00:24:28.400\nI want as the CEO, our organization to face clients.\n\n574\n00:24:28.400 --> 00:24:33.520\nI want our organization to take a long term approach to solving our clients\n\n575\n00:24:33.520 --> 00:24:34.280\nneeds.\n\n576\n00:24:34.280 --> 00:24:38.670\nAnd I'm convinced that if you take a long term approach and you build trust,\n\n577\n00:24:38.670 --> 00:24:39.560\ngood things\n\n578\n00:24:39.560 --> 00:24:43.080\nwill happen and we'll do just fine in those relationships.\n\n579\n00:24:43.080 --> 00:24:46.560\nAnd that to me, I think centers it the right way.\n\n580\n00:24:46.560 --> 00:24:49.130\nIn terms of the company and the organization, we're making a bunch of\n\n581\n00:24:49.130 --> 00:24:49.840\ninvestments.\n\n582\n00:24:49.840 --> 00:24:52.080\nAnd I do think this is a change.\n\n583\n00:24:52.080 --> 00:24:56.380\nThe organization does have to to perform as a public company, make longer term\n\n584\n00:24:56.380 --> 00:24:57.200\ninvestments\n\n585\n00:24:57.200 --> 00:25:02.600\nand those longer term investments have a drag on our short term performance.\n\n586\n00:25:02.600 --> 00:25:05.040\nAnd we're trying to be very transparent about that.\n\n587\n00:25:05.040 --> 00:25:06.960\nBut I think you've got to invest in the franchise.\n\n588\n00:25:06.960 --> 00:25:10.280\nAnd when I look back at this company historically, I look at some of the great\n\n589\n00:25:10.280 --> 00:25:11.040\nbusinesses we've\n\n590\n00:25:11.040 --> 00:25:15.960\nbuilt over the last 30, 40 years, we built an asset management business.\n\n591\n00:25:15.960 --> 00:25:18.840\nBut it took us really 15 years to gain traction.\n\n592\n00:25:18.840 --> 00:25:23.220\nWe built a merchant bank and investing platforms, but it took 10, 20 years to\n\n593\n00:25:23.220 --> 00:25:24.960\nreally build scale.\n\n594\n00:25:24.960 --> 00:25:27.680\nWe're building a transaction banking platform.\n\n595\n00:25:27.680 --> 00:25:28.880\nI'm trying to think about it.\n\n596\n00:25:28.880 --> 00:25:32.320\nHow can we make these strong businesses over the next decade or two?\n\n597\n00:25:32.320 --> 00:25:36.010\nAnd look, there's invariably going to be some pressure from investors and the\n\n598\n00:25:36.010 --> 00:25:36.280\nmarket\n\n599\n00:25:36.280 --> 00:25:37.520\nin the short term.\n\n600\n00:25:37.520 --> 00:25:41.790\nBut as long as we're striking the balance right and can show paths to\n\n601\n00:25:41.790 --> 00:25:42.680\ndelivering higher\n\n602\n00:25:42.680 --> 00:25:45.920\nreturns for our shareholders, I think the market will be accepting\n\n603\n00:25:45.920 --> 00:25:49.720\nof our investments and the overall strengthening of the organization.\n\n604\n00:25:49.720 --> 00:25:53.890\nI may have the number wrong, but I know you have about 40,000 employees around\n\n605\n00:25:53.890 --> 00:25:54.240\nthat.\n\n606\n00:25:54.240 --> 00:25:56.440\nYou have such a wide net.\n\n607\n00:25:56.440 --> 00:26:00.890\nHow do you make sure that you drive home the importance of values and ethics in\n\n608\n00:26:00.890 --> 00:26:01.520\nthe industry\n\n609\n00:26:01.520 --> 00:26:03.680\nthat you have to have that as job one?\n\n610\n00:26:03.680 --> 00:26:04.680\nYeah.\n\n611\n00:26:04.680 --> 00:26:07.680\nAnd so we have about 36, 37,000 employees spread around the world.\n\n612\n00:26:07.680 --> 00:26:09.600\nWe're in 45 countries.\n\n613\n00:26:09.600 --> 00:26:15.280\nAnd that's that is a core constant cultural focus of the firm.\n\n614\n00:26:15.280 --> 00:26:18.870\nHow do you make in different cultures and different places in the world the\n\n615\n00:26:18.870 --> 00:26:20.040\ncore cultural\n\n616\n00:26:20.040 --> 00:26:21.480\npillars of the organization?\n\n617\n00:26:21.480 --> 00:26:24.050\nHow do you make Goldman Sachs feel like Goldman Sachs as you get around the\n\n618\n00:26:24.050 --> 00:26:24.720\nworld?\n\n619\n00:26:24.720 --> 00:26:27.890\nAnd actually one of the things I take pride in as I travel around the world and\n\n620\n00:26:27.890 --> 00:26:28.200\nsee it\n\n621\n00:26:28.200 --> 00:26:31.080\nfirsthand is it feels like Goldman Sachs.\n\n622\n00:26:31.080 --> 00:26:33.120\nThose core foundational pillars are there.\n\n623\n00:26:33.120 --> 00:26:34.840\nBut I think you have to work hard at it.\n\n624\n00:26:34.840 --> 00:26:37.400\nAnd I think it's got to be something that you wake up every day and you think\n\n625\n00:26:37.400 --> 00:26:37.760\nabout it.\n\n626\n00:26:37.760 --> 00:26:41.400\nYou get the organization focused on and look at our business.\n\n627\n00:26:41.400 --> 00:26:47.060\nThis is one of the challenges of our business, 37,000 employees bad behavior by\n\n628\n00:26:47.060 --> 00:26:47.880\none, dense\n\n629\n00:26:47.880 --> 00:26:49.600\nour reputation.\n\n630\n00:26:49.600 --> 00:26:51.800\nAnd unfortunately that happens from time to time.\n\n631\n00:26:51.800 --> 00:26:57.470\nAnd so, you know, we spend a lot of time on training, on compliance, on really\n\n632\n00:26:57.470 --> 00:26:58.120\ntalking\n\n633\n00:26:58.120 --> 00:27:03.400\nabout why integrity is so important in building trust in everything we do.\n\n634\n00:27:03.400 --> 00:27:06.340\nAnd that doesn't mean that the organization's perfect and it gets it right\n\n635\n00:27:06.340 --> 00:27:07.000\nevery time.\n\n636\n00:27:07.000 --> 00:27:10.810\nAnd of course, whenever you have an organization to this size, there are people\n\n637\n00:27:10.810 --> 00:27:11.360\nthat do things\n\n638\n00:27:11.360 --> 00:27:12.360\nthat they shouldn't do.\n\n639\n00:27:12.360 --> 00:27:17.850\nBut you've got to be very, very firm about how you deal with that and where you\n\n640\n00:27:17.850 --> 00:27:18.360\nstand\n\n641\n00:27:18.360 --> 00:27:20.200\non what's right and what's not.\n\n642\n00:27:20.200 --> 00:27:24.230\nYou know, your industry, David, as you well know better than most, it's so\n\n643\n00:27:24.230 --> 00:27:25.040\ncompetitive\n\n644\n00:27:25.040 --> 00:27:29.510\nand you compete against big, massive companies like JP Borgachase and then, you\n\n645\n00:27:29.510 --> 00:27:30.320\nknow, small\n\n646\n00:27:30.320 --> 00:27:32.480\ninvestment boutiques.\n\n647\n00:27:32.480 --> 00:27:35.480\nHow do you see differentiating your company going forward?\n\n648\n00:27:35.480 --> 00:27:40.380\nWell, in our core business is investment banking, sales and trading, and active\n\n649\n00:27:40.380 --> 00:27:41.840\nasset management.\n\n650\n00:27:41.840 --> 00:27:46.820\nThese are businesses where there can be niche players that operate in some way,\n\n651\n00:27:46.820 --> 00:27:47.760\nbut to really\n\n652\n00:27:47.760 --> 00:27:53.140\nhave big businesses in those areas, you have to be a market leader, you have to\n\n653\n00:27:53.140 --> 00:27:54.000\nbe global,\n\n654\n00:27:54.000 --> 00:27:59.160\nyou have to be broad, you have to be deep, and we happen to be those things in\n\n655\n00:27:59.160 --> 00:27:59.680\nthose\n\n656\n00:27:59.680 --> 00:28:00.920\nbusinesses.\n\n657\n00:28:00.920 --> 00:28:06.620\nAnd so interestingly, you have people technology and capital, capital is a\n\n658\n00:28:06.620 --> 00:28:08.040\ncommodity, but the\n\n659\n00:28:08.040 --> 00:28:12.200\npeople are differentiating both in terms of what they do and the technology\n\n660\n00:28:12.200 --> 00:28:13.080\nthey can develop\n\n661\n00:28:13.080 --> 00:28:14.360\nin the organization.\n\n662\n00:28:14.360 --> 00:28:18.600\nAnd so there's a virtuous ecosystem when you're global and you're at scale in\n\n663\n00:28:18.600 --> 00:28:19.000\nthese\n\n664\n00:28:19.000 --> 00:28:22.320\nbusinesses that actually strengthens your position.\n\n665\n00:28:22.320 --> 00:28:26.520\nAnd we feel very lucky in those businesses to be in that position.\n\n666\n00:28:26.520 --> 00:28:28.880\nThat doesn't mean we take it for granted at all.\n\n667\n00:28:28.880 --> 00:28:32.720\nAnd that doesn't mean we're constantly investing to strengthen it.\n\n668\n00:28:32.720 --> 00:28:35.570\nBut one of our advantages is we're a true global firm and we can bring that to\n\n669\n00:28:35.570 --> 00:28:36.520\nour clients.\n\n670\n00:28:36.520 --> 00:28:40.280\nAnd we have the resources to do that.\n\n671\n00:28:40.280 --> 00:28:45.240\nI do think that the quality of our people and having an ecosystem with respect\n\n672\n00:28:45.240 --> 00:28:45.720\nto the\n\n673\n00:28:45.720 --> 00:28:49.560\npeople in the organization where our clients really do believe that they're\n\n674\n00:28:49.560 --> 00:28:50.440\ndifferentiated\n\n675\n00:28:50.440 --> 00:28:52.040\nis something that's hugely important.\n\n676\n00:28:52.040 --> 00:28:57.620\nAnd so we invest an awful lot in perpetuating that and making sure that that\n\n677\n00:28:57.620 --> 00:28:58.760\ncontinues.\n\n678\n00:28:58.760 --> 00:29:03.250\nAnd one of the things I take great pride in as I travel around is listening to\n\n679\n00:29:03.250 --> 00:29:03.840\nclients\n\n680\n00:29:03.840 --> 00:29:06.360\ntell me about how they value our people.\n\n681\n00:29:06.360 --> 00:29:09.470\nAnd I also appreciate when they tell me where they don't think it's up to the\n\n682\n00:29:09.470 --> 00:29:10.080\nstandard that\n\n683\n00:29:10.080 --> 00:29:11.680\nthey expect from Goldman Sachs.\n\n684\n00:29:11.680 --> 00:29:13.680\nAnd that's very, very important feedback.\n\n685\n00:29:13.680 --> 00:29:20.140\nThird, I do think that we're good at building platforms and using technology to\n\n686\n00:29:20.140 --> 00:29:21.040\ndisrupt or\n\n687\n00:29:21.040 --> 00:29:24.800\nchange the way products or services are connected with or delivered to our\n\n688\n00:29:24.800 --> 00:29:25.520\nclients.\n\n689\n00:29:25.520 --> 00:29:29.620\nAnd I'm excited about some of what we're doing as we start to expand what we\n\n690\n00:29:29.620 --> 00:29:31.960\ncan do for consumers.\n\n691\n00:29:31.960 --> 00:29:35.640\nAnd I think the digital platforms that we're building are quite interesting.\n\n692\n00:29:35.640 --> 00:29:39.360\nI don't think we get a lot of credit for it right now, but that's just fine.\n\n693\n00:29:39.360 --> 00:29:43.700\nBut I feel very good about what we're building and how it's differentiated\n\n694\n00:29:43.700 --> 00:29:44.600\nversus some of\n\n695\n00:29:44.600 --> 00:29:45.800\nthe offerings that are out there.\n\n696\n00:29:45.800 --> 00:29:47.600\nAnd so I'm excited about that for sure.\n\n697\n00:29:47.600 --> 00:29:50.770\nNow, when you look at the world, David, what countries and opportunities are\n\n698\n00:29:50.770 --> 00:29:51.640\nyou most excited\n\n699\n00:29:51.640 --> 00:29:52.640\nabout?\n\n700\n00:29:52.640 --> 00:29:54.920\nI'm still very excited about the United States.\n\n701\n00:29:54.920 --> 00:29:58.910\nAnd for good or for bad, and there's a lot going on around the world, one of\n\n702\n00:29:58.910 --> 00:29:59.640\nthe things\n\n703\n00:29:59.640 --> 00:30:02.740\nthat I notice as I get around the world is there are a lot of people around the\n\n704\n00:30:02.740 --> 00:30:03.040\nworld\n\n705\n00:30:03.040 --> 00:30:06.030\nthat want to get capital into the United States or want to get into the United\n\n706\n00:30:06.030 --> 00:30:06.600\nStates.\n\n707\n00:30:06.600 --> 00:30:10.720\nAnd that's a real advantage for us and something we need to protect.\n\n708\n00:30:10.720 --> 00:30:13.480\nAnd our model is not perfect here.\n\n709\n00:30:13.480 --> 00:30:15.680\nThere are certainly things we can do to improve it.\n\n710\n00:30:15.680 --> 00:30:19.390\nThere are certainly things we need to do to continue to improve the opportunity\n\n711\n00:30:19.390 --> 00:30:19.800\nset for\n\n712\n00:30:19.800 --> 00:30:21.640\neveryone across the country.\n\n713\n00:30:21.640 --> 00:30:26.040\nBut I'm a big believer in our system and the opportunities that are here.\n\n714\n00:30:26.040 --> 00:30:29.920\nAnd so Goldman Sachs, while a global firm is a US company and just very\n\n715\n00:30:29.920 --> 00:30:30.760\ncommitted to\n\n716\n00:30:30.760 --> 00:30:36.040\nthe opportunities to serve our clients here in the US, that said, we're very\n\n717\n00:30:36.040 --> 00:30:36.960\ncorrelated\n\n718\n00:30:36.960 --> 00:30:38.360\nto the big economies in the world.\n\n719\n00:30:38.360 --> 00:30:42.020\nSo we're very correlated to the broad European economy next, which is obviously\n\n720\n00:30:42.020 --> 00:30:42.560\na very, very\n\n721\n00:30:42.560 --> 00:30:44.560\nsignificant economy.\n\n722\n00:30:44.560 --> 00:30:48.410\nAnd we're investing in and correlated to China, although obviously the\n\n723\n00:30:48.410 --> 00:30:49.560\nrelationship between\n\n724\n00:30:49.560 --> 00:30:51.560\nthe US and China is more complicated.\n\n725\n00:30:51.560 --> 00:30:53.880\nAnd I think they're going to be bumps in that over the next decade.\n\n726\n00:30:53.880 --> 00:30:57.330\nBut you know, you know, very well from Yum's experience, you know, the\n\n727\n00:30:57.330 --> 00:30:58.240\nopportunity set\n\n728\n00:30:58.240 --> 00:31:02.230\nto build big businesses in China, especially if the business that you're in is\n\n729\n00:31:02.230 --> 00:31:02.680\nreally\n\n730\n00:31:02.680 --> 00:31:06.000\nopen, financial services is really not open yet.\n\n731\n00:31:06.000 --> 00:31:08.560\nBut I think over time, it will become more open.\n\n732\n00:31:08.560 --> 00:31:10.960\nAnd so we're trying to position ourselves for that.\n\n733\n00:31:10.960 --> 00:31:14.200\nYou're probably wondering when I was going to ask you this question because I\n\n734\n00:31:14.200 --> 00:31:14.640\nknow you\n\n735\n00:31:14.640 --> 00:31:15.640\nget it from everybody.\n\n736\n00:31:15.640 --> 00:31:19.590\nBut you know, I've learned that you're not only a big time CEO, but you're a\n\n737\n00:31:19.590 --> 00:31:20.560\nworld renowned\n\n738\n00:31:20.560 --> 00:31:23.240\nDJ, you know, tell us how you got into that.\n\n739\n00:31:23.240 --> 00:31:24.720\nWell, you knew I had to ask you.\n\n740\n00:31:24.720 --> 00:31:27.160\nYeah, world world renowned would be a stretch.\n\n741\n00:31:27.160 --> 00:31:31.670\nI am a competent house music DJ who because he happens to be a CEO probably\n\n742\n00:31:31.670 --> 00:31:32.360\ngets more\n\n743\n00:31:32.360 --> 00:31:34.400\nvisibility than he deserves.\n\n744\n00:31:34.400 --> 00:31:39.730\nI've always been into music and about 10 years ago, because I happened to be\n\n745\n00:31:39.730 --> 00:31:41.120\nlooking at what\n\n746\n00:31:41.120 --> 00:31:44.550\nwas going on in Las Vegas and how the business model was changing in these\n\n747\n00:31:44.550 --> 00:31:45.360\nlarge hotels,\n\n748\n00:31:45.360 --> 00:31:48.200\nbecause we were doing some banking work around that.\n\n749\n00:31:48.200 --> 00:31:52.710\nYou could see how big a business this was becoming this performance music\n\n750\n00:31:52.710 --> 00:31:53.480\nbusiness,\n\n751\n00:31:53.480 --> 00:31:56.280\nyou know, in whether it's in hotels or clubs.\n\n752\n00:31:56.280 --> 00:32:00.120\nAnd I started asking questions of people in the music industry and I started\n\n753\n00:32:00.120 --> 00:32:00.640\nlearning\n\n754\n00:32:00.640 --> 00:32:03.640\nabout some of the music and I actually found I liked the music.\n\n755\n00:32:03.640 --> 00:32:07.600\nI mean, I've loved all kinds of music and I've been very into music and live\n\n756\n00:32:07.600 --> 00:32:08.080\nmusic for\n\n757\n00:32:08.080 --> 00:32:10.000\na long time, but I really liked this music.\n\n758\n00:32:10.000 --> 00:32:12.560\nSo I got introduced to some people.\n\n759\n00:32:12.560 --> 00:32:16.680\nI got introduced to a pretty world renowned DJ named Paul Oakenfold, who's been\n\n760\n00:32:16.680 --> 00:32:16.880\naround\n\n761\n00:32:16.880 --> 00:32:17.880\nfor a long time.\n\n762\n00:32:17.880 --> 00:32:21.660\nIt was very involved in the early days of house music and electronic music and\n\n763\n00:32:21.660 --> 00:32:23.160\nclub music.\n\n764\n00:32:23.160 --> 00:32:26.900\nAnd he suggested to me that he would help me learn to DJ and introduce me to\n\n765\n00:32:26.900 --> 00:32:27.600\nsome other\n\n766\n00:32:27.600 --> 00:32:28.600\npeople.\n\n767\n00:32:28.600 --> 00:32:32.080\nAnd I started doing it in my dining room on weekends for fun.\n\n768\n00:32:32.080 --> 00:32:37.290\nAnd about five years ago, Paul was coming to New York to perform and he said to\n\n769\n00:32:37.290 --> 00:32:37.560\nme,\n\n770\n00:32:37.560 --> 00:32:39.760\nhey, you know, you're getting pretty good.\n\n771\n00:32:39.760 --> 00:32:44.050\nWhy don't you come play for an hour in a real live club called Marquis on the\n\n772\n00:32:44.050 --> 00:32:44.520\nUpper\n\n773\n00:32:44.520 --> 00:32:45.520\nWest Side of Manhattan?\n\n774\n00:32:45.520 --> 00:32:49.640\nAnd I said to Paul, I've never DJed in front of anybody other than my family or\n\n775\n00:32:49.640 --> 00:32:50.280\nthe dining\n\n776\n00:32:50.280 --> 00:32:51.280\nroom chairs.\n\n777\n00:32:51.280 --> 00:32:53.560\nYou know, can I really do this?\n\n778\n00:32:53.560 --> 00:32:55.160\nAnd he said, come on, go do it.\n\n779\n00:32:55.160 --> 00:32:56.160\nIt'll be early.\n\n780\n00:32:56.160 --> 00:32:57.160\nThere won't be a lot of people there.\n\n781\n00:32:57.160 --> 00:32:58.440\nAnd I showed up and I did it.\n\n782\n00:32:58.440 --> 00:32:59.440\nAnd I really enjoyed it.\n\n783\n00:32:59.440 --> 00:33:04.560\nSo I started doing it as a little bit of a hobby quietly just for fun.\n\n784\n00:33:04.560 --> 00:33:09.230\nAnd then, you know, as my job gave me more visibility a few years ago, I got\n\n785\n00:33:09.230 --> 00:33:09.840\nouted and\n\n786\n00:33:09.840 --> 00:33:13.760\nthen I had to decide, okay, I'm either going to invest some time and do it at a\n\n787\n00:33:13.760 --> 00:33:14.240\nhigher\n\n788\n00:33:14.240 --> 00:33:17.040\nlevel or I'm going to give it up and I decided try to do it.\n\n789\n00:33:17.040 --> 00:33:19.800\nWhen I do get paid, the money goes to charity.\n\n790\n00:33:19.800 --> 00:33:21.640\nI started producing some music.\n\n791\n00:33:21.640 --> 00:33:22.960\nThere are revenues from the streaming.\n\n792\n00:33:22.960 --> 00:33:23.960\nThat all goes to charity.\n\n793\n00:33:23.960 --> 00:33:28.840\nI've created a record label called Payback Records and Payback Records.\n\n794\n00:33:28.840 --> 00:33:31.400\nI'm ultimately going to try to get some other artists on it.\n\n795\n00:33:31.400 --> 00:33:34.760\nBut the goal is to produce some music and have the proceeds of that go to\n\n796\n00:33:34.760 --> 00:33:35.760\naddiction charities\n\n797\n00:33:35.760 --> 00:33:37.320\naround the United States.\n\n798\n00:33:37.320 --> 00:33:41.980\nAnd so if I have the opportunity to do this at a slightly higher level than I\n\n799\n00:33:41.980 --> 00:33:42.920\ndeserve because\n\n800\n00:33:42.920 --> 00:33:46.160\nof my business position, I'm going to try to do some good with it.\n\n801\n00:33:46.160 --> 00:33:47.160\nThat's great.\n\n802\n00:33:47.160 --> 00:33:49.840\nYou know, I mean this is a very high compliment.\n\n803\n00:33:49.840 --> 00:33:55.000\nYou're not cut from the same plot as a lot of CEOs that I know.\n\n804\n00:33:55.000 --> 00:33:57.040\nYou know, you really are authentic.\n\n805\n00:33:57.040 --> 00:34:02.200\nI can see how in your world it's a 24/7 world that you could be criticized for\n\n806\n00:34:02.200 --> 00:34:03.760\nbeing a DJ,\n\n807\n00:34:03.760 --> 00:34:04.960\nbut you've stuck to it.\n\n808\n00:34:04.960 --> 00:34:08.550\nHow do you deal with your authenticity and staying true to who you really are\n\n809\n00:34:08.550 --> 00:34:09.040\nand what\n\n810\n00:34:09.040 --> 00:34:10.040\nyou believe?\n\n811\n00:34:10.040 --> 00:34:13.060\nWell, I think you've got to, when you become a public figure in the context of\n\n812\n00:34:13.060 --> 00:34:13.520\nrunning\n\n813\n00:34:13.520 --> 00:34:17.830\none of these companies, I think you have to decide, you know, who you are and\n\n814\n00:34:17.830 --> 00:34:18.280\nwhat you\n\n815\n00:34:18.280 --> 00:34:19.800\nstand for and what you want to be.\n\n816\n00:34:19.800 --> 00:34:21.760\nAnd I've decided that I'm going to be me.\n\n817\n00:34:21.760 --> 00:34:25.920\nI don't think if you walked around the halls of Goldman Sachs, anyone inside\n\n818\n00:34:25.920 --> 00:34:26.800\nGoldman Sachs\n\n819\n00:34:26.800 --> 00:34:33.310\nwould ever criticize my work ethic, my focus, my intensity around helping\n\n820\n00:34:33.310 --> 00:34:34.600\nGoldman Sachs\n\n821\n00:34:34.600 --> 00:34:37.520\nwith our great team here and move forward.\n\n822\n00:34:37.520 --> 00:34:38.520\nBut I still have a life.\n\n823\n00:34:38.520 --> 00:34:39.520\nI'm still a human being.\n\n824\n00:34:39.520 --> 00:34:42.400\nI put on my pants one leg at a time just like you do.\n\n825\n00:34:42.400 --> 00:34:46.040\nAnd I mean, maybe you jump into them both, but at my age and your age, you know\n\n826\n00:34:46.040 --> 00:34:46.480\n, one leg\n\n827\n00:34:46.480 --> 00:34:47.960\nat a time.\n\n828\n00:34:47.960 --> 00:34:51.850\nAnd you know, I have things that I enjoy and, you know, I'm at a different\n\n829\n00:34:51.850 --> 00:34:52.640\nstage of life\n\n830\n00:34:52.640 --> 00:34:54.240\nbecause my kids are grown.\n\n831\n00:34:54.240 --> 00:34:57.570\nSo when I'm not working and I have my own time, I don't have to be so focused\n\n832\n00:34:57.570 --> 00:34:58.240\non my kids and\n\n833\n00:34:58.240 --> 00:34:59.240\nfamily.\n\n834\n00:34:59.240 --> 00:35:01.600\nAnd so I have time to do these things.\n\n835\n00:35:01.600 --> 00:35:05.790\nThere are a lot of CEOs that play golf and I do play a little bit of golf, but\n\n836\n00:35:05.790 --> 00:35:06.280\nthere are\n\n837\n00:35:06.280 --> 00:35:10.150\na lot of Sundays when my friends are playing golf and instead of spending, you\n\n838\n00:35:10.150 --> 00:35:10.640\nknow, six\n\n839\n00:35:10.640 --> 00:35:14.800\nhours to go play golf, I'll spend six hours in the music studio.\n\n840\n00:35:14.800 --> 00:35:18.370\nAnd I get as much pleasure out of that, candidly more pleasure out of that than\n\n841\n00:35:18.370 --> 00:35:19.080\nplaying golf\n\n842\n00:35:19.080 --> 00:35:20.840\ngiven the quality of my game.\n\n843\n00:35:20.840 --> 00:35:25.020\nBut I still, you know, it's, you know, you've got to find things to clear your\n\n844\n00:35:25.020 --> 00:35:25.640\nhead and I\n\n845\n00:35:25.640 --> 00:35:29.120\nfind this to be something that relaxes me and clears my head.\n\n846\n00:35:29.120 --> 00:35:30.520\nIt makes me more effective.\n\n847\n00:35:30.520 --> 00:35:34.720\nAnd I've also, your authenticity point, it's something people can relate to.\n\n848\n00:35:34.720 --> 00:35:35.720\nPeople love music.\n\n849\n00:35:35.720 --> 00:35:36.880\nEverybody loves music.\n\n850\n00:35:36.880 --> 00:35:42.850\nAnd I love the fact that I walk around Goldman Sachs and people who work here\n\n851\n00:35:42.850 --> 00:35:43.360\nwant to talk\n\n852\n00:35:43.360 --> 00:35:44.360\nto me about music.\n\n853\n00:35:44.360 --> 00:35:46.920\nThey want to talk to me about Goldman Sachs too.\n\n854\n00:35:46.920 --> 00:35:50.960\nBut in some way, shape or form, you know, I hope it just makes everyone in the\n\n855\n00:35:50.960 --> 00:35:51.840\norganization\n\n856\n00:35:51.840 --> 00:35:53.080\nrecognize I'm just like them.\n\n857\n00:35:53.080 --> 00:35:55.640\nI just happen to have a different job.\n\n858\n00:35:55.640 --> 00:36:02.350\nWe'll be back with the rest of my conversation with David Solomon in just a\n\n859\n00:36:02.350 --> 00:36:03.400\nmoment.\n\n860\n00:36:03.400 --> 00:36:07.100\nYou know, this tension between long-term results and short-term results is\n\n861\n00:36:07.100 --> 00:36:07.680\nsomething\n\n862\n00:36:07.680 --> 00:36:09.400\nevery leader faces.\n\n863\n00:36:09.400 --> 00:36:11.480\nAnd I love Dave Cody's take on it.\n\n864\n00:36:11.480 --> 00:36:16.960\nHe was a CEO of Honeywell for 16 years and he led an incredible turnaround and\n\n865\n00:36:16.960 --> 00:36:17.680\nhe believes\n\n866\n00:36:17.680 --> 00:36:21.880\nyou don't have to choose between long-term and short-term results.\n\n867\n00:36:21.880 --> 00:36:26.480\nThis conversation might be just the paradigm shift that you need.\n\n868\n00:36:26.480 --> 00:36:31.030\nYou don't have to tell your boss or your investor, \"Hey, wait for three years\n\n869\n00:36:31.030 --> 00:36:31.400\nand then\n\n870\n00:36:31.400 --> 00:36:33.200\neverything's going to be terrific.\"\n\n871\n00:36:33.200 --> 00:36:37.800\nRather, there are things you can be doing that allow you to perform better in\n\n872\n00:36:37.800 --> 00:36:38.960\nthe short-term\n\n873\n00:36:38.960 --> 00:36:43.250\nso that your boss and investor are satisfied, but also does all the seed\n\n874\n00:36:43.250 --> 00:36:44.240\nplanting that's\n\n875\n00:36:44.240 --> 00:36:46.080\nneeded for the long-term.\n\n876\n00:36:46.080 --> 00:36:50.630\nGo back and listen to my entire conversation with Dave Cody, episode 20, here\n\n877\n00:36:50.630 --> 00:36:51.520\non How Leaders\n\n878\n00:36:51.520 --> 00:36:54.520\nLead.\n\n879\n00:36:54.520 --> 00:37:01.860\nDavid, this has been so much fun and I want to have some more with my lightning\n\n880\n00:37:01.860 --> 00:37:02.520\nround\n\n881\n00:37:02.520 --> 00:37:04.080\nof Q&A.\n\n882\n00:37:04.080 --> 00:37:09.000\nWhat's one word that others would use to describe you?\n\n883\n00:37:09.000 --> 00:37:10.520\nResilient.\n\n884\n00:37:10.520 --> 00:37:14.080\nWhat would you say is the one word that best describes you?\n\n885\n00:37:14.080 --> 00:37:15.280\nPersistent.\n\n886\n00:37:15.280 --> 00:37:19.960\nIf you could be one person beside yourself for a day, who would it be and why?\n\n887\n00:37:19.960 --> 00:37:24.170\nI mean, I've always had a fantasy to play basketball for the New York Knicks,\n\n888\n00:37:24.170 --> 00:37:25.120\nso put me\n\n889\n00:37:25.120 --> 00:37:26.800\nin the shoes of a great basketball player.\n\n890\n00:37:26.800 --> 00:37:30.120\nI'd love to be a professional basketball player for a day.\n\n891\n00:37:30.120 --> 00:37:31.840\nWhat's your biggest pet peeve?\n\n892\n00:37:31.840 --> 00:37:33.240\nI like transparency.\n\n893\n00:37:33.240 --> 00:37:34.920\nI like direct engagement.\n\n894\n00:37:34.920 --> 00:37:37.720\nI like honest debate.\n\n895\n00:37:37.720 --> 00:37:41.560\nAt times, people don't really want to tell you how they feel.\n\n896\n00:37:41.560 --> 00:37:46.530\nI just wish people would tell you candidly nicely how they feel and that people\n\n897\n00:37:46.530 --> 00:37:46.960\nwould\n\n898\n00:37:46.960 --> 00:37:51.960\nbe open to discussion and debate, even on difficult topics.\n\n899\n00:37:51.960 --> 00:37:55.680\nDescribe your last, \"I can't believe this is happening me moment.\"\n\n900\n00:37:55.680 --> 00:37:59.600\nMy last, really, \"I can't believe this is happening to me moment\" is when my\n\n901\n00:37:59.600 --> 00:38:00.200\ndaughter\n\n902\n00:38:00.200 --> 00:38:04.240\ntold me recently she was getting married.\n\n903\n00:38:04.240 --> 00:38:07.440\nI really, I just can't believe I can't believe I'm at a point where my kids are\n\n904\n00:38:07.440 --> 00:38:08.640\ngetting married.\n\n905\n00:38:08.640 --> 00:38:12.600\nI also can't believe that I turned 61 last week, David.\n\n906\n00:38:12.600 --> 00:38:18.040\nIt's all in the root of how did this happen that I got to this point?\n\n907\n00:38:18.040 --> 00:38:21.440\nWhat would I hear if I turned on the radio in your car?\n\n908\n00:38:21.440 --> 00:38:29.320\nYou would hear probably Sirius BPM, Station 51, or you might hear 70s on 7.\n\n909\n00:38:29.320 --> 00:38:32.080\nIt would be both ends of the spectrum.\n\n910\n00:38:32.080 --> 00:38:36.600\nWhat's something about you, David, that few people would know?\n\n911\n00:38:36.600 --> 00:38:39.440\nI'm a kite surfer.\n\n912\n00:38:39.440 --> 00:38:40.440\nThat's fantastic.\n\n913\n00:38:40.440 --> 00:38:42.360\nOkay, that's the end of the lightning round.\n\n914\n00:38:42.360 --> 00:38:44.120\nI'll get into a few questions here.\n\n915\n00:38:44.120 --> 00:38:46.840\nDavid, you've been CEO now for four and a half years.\n\n916\n00:38:46.840 --> 00:38:52.000\nIs there anything about being in that seat that surprised you?\n\n917\n00:38:52.000 --> 00:38:54.400\nSomething that you really didn't expect?\n\n918\n00:38:54.400 --> 00:38:59.410\nI think, David, the thing that's really interesting about being a CEO and\n\n919\n00:38:59.410 --> 00:39:00.360\nreally sitting in one\n\n920\n00:39:00.360 --> 00:39:05.000\nof these seats, and I know you appreciate this, you did this, as a banker, I\n\n921\n00:39:05.000 --> 00:39:05.560\nalways\n\n922\n00:39:05.560 --> 00:39:10.370\nwould talk to CEOs and they'd talk about sometimes the loneliness, the\n\n923\n00:39:10.370 --> 00:39:12.400\nisolation, the fact that\n\n924\n00:39:12.400 --> 00:39:16.680\na whole bunch of the communication in some way gets cut off to you as you sit\n\n925\n00:39:16.680 --> 00:39:17.240\nin those\n\n926\n00:39:17.240 --> 00:39:18.240\nseats.\n\n927\n00:39:18.240 --> 00:39:22.160\nWhat you're trying to do is you're trying to constantly open up channels to get\n\n928\n00:39:22.160 --> 00:39:22.600\npeople\n\n929\n00:39:22.600 --> 00:39:24.160\ntalking, to get the information.\n\n930\n00:39:24.160 --> 00:39:26.040\nYou've got to work very, very hard at it.\n\n931\n00:39:26.040 --> 00:39:30.490\nI always would listen to other CEOs and imagine how they felt or what that\n\n932\n00:39:30.490 --> 00:39:31.440\nmeant in terms\n\n933\n00:39:31.440 --> 00:39:34.440\nof the loneliness or the separation.\n\n934\n00:39:34.440 --> 00:39:41.660\nI was really surprised when I actually got into the seat how real it is and how\n\n935\n00:39:41.660 --> 00:39:42.320\ndifferent\n\n936\n00:39:42.320 --> 00:39:43.680\nit is.\n\n937\n00:39:43.680 --> 00:39:47.400\nYou can imagine it, but until you really sit there and feel it, it's just a\n\n938\n00:39:47.400 --> 00:39:48.000\nvery, very\n\n939\n00:39:48.000 --> 00:39:49.200\ndifferent experience.\n\n940\n00:39:49.200 --> 00:39:53.740\nI think one of the great challenges for leaders is you've got to figure out how\n\n941\n00:39:53.740 --> 00:39:54.600\nto do everything\n\n942\n00:39:54.600 --> 00:40:00.140\nyou can to change or modify that dynamic that generally just occurs as you sit\n\n943\n00:40:00.140 --> 00:40:00.800\nin one of\n\n944\n00:40:00.800 --> 00:40:02.960\nthese CEO jobs.\n\n945\n00:40:02.960 --> 00:40:08.400\nAnytime a leader comes into a new role, they always make changes.\n\n946\n00:40:08.400 --> 00:40:12.630\nWhen you look back on your tenure as CEO, what's the change that you've made\n\n947\n00:40:12.630 --> 00:40:13.440\nthat you're most\n\n948\n00:40:13.440 --> 00:40:14.440\nproud of?\n\n949\n00:40:14.440 --> 00:40:17.520\nI think the thing that I'm most proud of in my tenure that relates specifically\n\n950\n00:40:17.520 --> 00:40:18.040\nto Goldman\n\n951\n00:40:18.040 --> 00:40:23.840\nSachs is the firm has always been a firm with a real strong client orientation.\n\n952\n00:40:23.840 --> 00:40:27.720\nThere were parts of our businesses where there were opportunities to really\n\n953\n00:40:27.720 --> 00:40:28.240\nenhance\n\n954\n00:40:28.240 --> 00:40:31.280\nthe client experience.\n\n955\n00:40:31.280 --> 00:40:34.240\nBecause we were enhancing the client experience, get a better result for\n\n956\n00:40:34.240 --> 00:40:35.280\nourselves as a business\n\n957\n00:40:35.280 --> 00:40:36.840\nwith our clients.\n\n958\n00:40:36.840 --> 00:40:40.300\nThe place where this has been most evident over the last few years is in our\n\n959\n00:40:40.300 --> 00:40:41.320\nmarkets business,\n\n960\n00:40:41.320 --> 00:40:44.520\nour fickin' equities businesses, our trading businesses.\n\n961\n00:40:44.520 --> 00:40:48.830\nWe've really enhanced the client experience, not that it wasn't good before,\n\n962\n00:40:48.830 --> 00:40:49.400\nbut we've\n\n963\n00:40:49.400 --> 00:40:51.480\nreally enhanced it.\n\n964\n00:40:51.480 --> 00:40:56.760\nThat's led to over 300 basis point improvement in market share and a very large\n\n965\n00:40:56.760 --> 00:40:57.880\nmature business\n\n966\n00:40:57.880 --> 00:40:58.880\nfor the firm.\n\n967\n00:40:58.880 --> 00:41:01.040\nIt's really grown the business and strengthened the business.\n\n968\n00:41:01.040 --> 00:41:04.840\nI think it's as a result, strengthened the overall performance for the firm.\n\n969\n00:41:04.840 --> 00:41:09.900\nThat was something that I think wasn't obvious more broadly that we made a very\n\n970\n00:41:09.900 --> 00:41:11.200\n, very particular\n\n971\n00:41:11.200 --> 00:41:12.200\nstrategic objective.\n\n972\n00:41:12.200 --> 00:41:13.760\nI think we've really executed on it.\n\n973\n00:41:13.760 --> 00:41:14.760\nIt's made a difference.\n\n974\n00:41:14.760 --> 00:41:18.280\nI'm quite proud of the team and the way they've delivered on that.\n\n975\n00:41:18.280 --> 00:41:22.630\nWhat would you say, David, is the biggest change you've tried to make that met\n\n976\n00:41:22.630 --> 00:41:23.440\nwith the most\n\n977\n00:41:23.440 --> 00:41:24.840\nresistance?\n\n978\n00:41:24.840 --> 00:41:28.800\nThe changes we've made in the organization that have been toughest have been\n\n979\n00:41:28.800 --> 00:41:29.640\norganizational\n\n980\n00:41:29.640 --> 00:41:31.560\nalignments.\n\n981\n00:41:31.560 --> 00:41:36.680\nOur business was organized a certain way four and a half years ago.\n\n982\n00:41:36.680 --> 00:41:40.160\nWe decided that we wanted to reorganize the business and the operating\n\n983\n00:41:40.160 --> 00:41:40.920\ndivisions of the\n\n984\n00:41:40.920 --> 00:41:41.920\nbusiness.\n\n985\n00:41:41.920 --> 00:41:46.480\nWe've actually made two realignments during the four and a half years.\n\n986\n00:41:46.480 --> 00:41:49.970\nWe now have the business in a place where I think it's really aligned the way\n\n987\n00:41:49.970 --> 00:41:50.360\nwe run\n\n988\n00:41:50.360 --> 00:41:51.520\nabout in the business.\n\n989\n00:41:51.520 --> 00:41:53.440\nThose were big changes.\n\n990\n00:41:53.440 --> 00:41:58.090\nThose obviously had an impact on different leadership groups and who was\n\n991\n00:41:58.090 --> 00:41:58.880\nleading and\n\n992\n00:41:58.880 --> 00:42:02.600\nhow the business was set up.\n\n993\n00:42:02.600 --> 00:42:04.240\nThose were tough changes to execute on.\n\n994\n00:42:04.240 --> 00:42:08.780\nThe biggest one is we had a number of asset management businesses in the firm\n\n995\n00:42:08.780 --> 00:42:09.160\nand a big\n\n996\n00:42:09.160 --> 00:42:10.160\nwealth business.\n\n997\n00:42:10.160 --> 00:42:15.970\nWe really thought that as an integrated platform, as one big client franchise,\n\n998\n00:42:15.970 --> 00:42:16.920\nas an asset wealth\n\n999\n00:42:16.920 --> 00:42:20.580\nmanagement franchise, we'd be much more effective in serving our clients and we\n\n1000\n00:42:20.580 --> 00:42:21.200\n'd have a much\n\n1001\n00:42:21.200 --> 00:42:26.040\nbetter ability to deliver for our clients.\n\n1002\n00:42:26.040 --> 00:42:29.130\nPulling those different businesses together into one big broad business\n\n1003\n00:42:29.130 --> 00:42:29.800\nplatform, now\n\n1004\n00:42:29.800 --> 00:42:35.320\nthe fifth largest asset manager in the world, was a big change.\n\n1005\n00:42:35.320 --> 00:42:37.920\nIt wasn't easy and there were bumps along the way.\n\n1006\n00:42:37.920 --> 00:42:40.660\nI think people really now see the benefit and I think we have a business that\n\n1007\n00:42:40.660 --> 00:42:41.200\nwe can grow\n\n1008\n00:42:41.200 --> 00:42:45.520\nmeaningfully, improve the margins meaningfully over the course of the next few\n\n1009\n00:42:45.520 --> 00:42:46.120\nyears.\n\n1010\n00:42:46.120 --> 00:42:48.040\nI think it's set up very well.\n\n1011\n00:42:48.040 --> 00:42:52.530\nThose were some difficult changes because you're taking businesses that people\n\n1012\n00:42:52.530 --> 00:42:53.400\nran, combining\n\n1013\n00:42:53.400 --> 00:42:54.400\nthem.\n\n1014\n00:42:54.400 --> 00:42:59.040\nThey're obviously winners and losers and corporate parlance in that.\n\n1015\n00:42:59.040 --> 00:43:02.660\nThat stuff's never easy, but I think it was certainly worth the effort here\n\n1016\n00:43:02.660 --> 00:43:03.360\nbecause I think\n\n1017\n00:43:03.360 --> 00:43:06.560\nit positions the firm in a much better way to serve our clients.\n\n1018\n00:43:06.560 --> 00:43:11.140\nIt's always gratifying when you make those big changes and you begin to see the\n\n1019\n00:43:11.140 --> 00:43:11.640\nfruits\n\n1020\n00:43:11.640 --> 00:43:12.640\nof your labor.\n\n1021\n00:43:12.640 --> 00:43:16.900\nAnother thing that I know as a CEO you're focused on is the culture and\n\n1022\n00:43:16.900 --> 00:43:17.840\nenhancing and\n\n1023\n00:43:17.840 --> 00:43:23.060\nimproving the culture, which is obviously at Goldman Sachs, it was already good\n\n1024\n00:43:23.060 --> 00:43:23.360\n.\n\n1025\n00:43:23.360 --> 00:43:28.280\nBut as you think about a David Solomon behavior that you really wanted to drive\n\n1026\n00:43:28.280 --> 00:43:30.120\ninto the organization,\n\n1027\n00:43:30.120 --> 00:43:34.830\nis there one that you're really trying to put a personal stamp on in terms of\n\n1028\n00:43:34.830 --> 00:43:35.920\nthe culture?\n\n1029\n00:43:35.920 --> 00:43:39.880\nI think David, the culture of Goldman Sachs has been a great asset to the firm.\n\n1030\n00:43:39.880 --> 00:43:45.940\nThe fact that we retained a partnership culture after going public when most\n\n1031\n00:43:45.940 --> 00:43:47.160\nother partnerships\n\n1032\n00:43:47.160 --> 00:43:52.490\nthat were in the financial services business dissolved that ethos has been a\n\n1033\n00:43:52.490 --> 00:43:53.320\nhuge asset\n\n1034\n00:43:53.320 --> 00:43:54.320\nto us.\n\n1035\n00:43:54.320 --> 00:43:58.200\nI really think the most important cultural thing that I've tried to do, and\n\n1036\n00:43:58.200 --> 00:43:58.800\nthere are\n\n1037\n00:43:58.800 --> 00:44:01.600\na number of cultural things we're very focused on, but it's really\n\n1038\n00:44:01.600 --> 00:44:03.040\nstrengthening this partnership\n\n1039\n00:44:03.040 --> 00:44:05.880\nculture inside a big public company.\n\n1040\n00:44:05.880 --> 00:44:10.240\nAnd so really investing and making sure as the firm has gotten bigger that the\n\n1041\n00:44:10.240 --> 00:44:10.960\npartnership\n\n1042\n00:44:10.960 --> 00:44:15.170\nis special, that the quality of the people, the excellence of the people in\n\n1043\n00:44:15.170 --> 00:44:16.240\nthat partnership\n\n1044\n00:44:16.240 --> 00:44:20.640\ncontinues in the same way it has for generations of Goldman Sachs, that the\n\n1045\n00:44:20.640 --> 00:44:21.640\naspiration to be\n\n1046\n00:44:21.640 --> 00:44:26.000\na part of that partnership continues in the same way.\n\n1047\n00:44:26.000 --> 00:44:28.560\nAnd it's not really a personal stamp of me.\n\n1048\n00:44:28.560 --> 00:44:34.120\nIt's really more a stewardship of this very valuable aspect of Goldman Sachs\n\n1049\n00:44:34.120 --> 00:44:34.800\nthat I think\n\n1050\n00:44:34.800 --> 00:44:36.480\nreally differentiates the firm.\n\n1051\n00:44:36.480 --> 00:44:39.510\nAnd I'm trying to do everything I can to be the best steward I possibly can be\n\n1052\n00:44:39.510 --> 00:44:40.160\nof that\n\n1053\n00:44:40.160 --> 00:44:43.840\npiece of the culture that I think is so very important.\n\n1054\n00:44:43.840 --> 00:44:48.390\nI'm curious, David, what do you see ahead in the economy the next few years,\n\n1055\n00:44:48.390 --> 00:44:48.840\nand how\n\n1056\n00:44:48.840 --> 00:44:53.000\ndo you think leaders should be preparing for it with this in mind?\n\n1057\n00:44:53.000 --> 00:44:55.600\nDavid, it's an uncertain environment.\n\n1058\n00:44:55.600 --> 00:44:59.880\nAnd I think you really, to kind of frame the forward from here, I think you've\n\n1059\n00:44:59.880 --> 00:45:00.200\ngot to\n\n1060\n00:45:00.200 --> 00:45:04.630\nthink a little bit about the journey we've been on and how did we get here,\n\n1061\n00:45:04.630 --> 00:45:05.120\ncoming out\n\n1062\n00:45:05.120 --> 00:45:09.470\nof the financial crisis, we went through a decade of very, very easy monetary\n\n1063\n00:45:09.470 --> 00:45:10.240\npolicy,\n\n1064\n00:45:10.240 --> 00:45:14.840\neven as economic conditions normalized after the financial crisis, there never\n\n1065\n00:45:14.840 --> 00:45:16.560\nreally was\n\n1066\n00:45:16.560 --> 00:45:21.520\nthe move from central banks around the world to kind of normalize monetary\n\n1067\n00:45:21.520 --> 00:45:22.320\npolicy.\n\n1068\n00:45:22.320 --> 00:45:25.400\nAnd we were just starting to do that when we had a real out of the box, Black\n\n1069\n00:45:25.400 --> 00:45:25.960\nSwan event,\n\n1070\n00:45:25.960 --> 00:45:30.540\nthe pandemic, and not so much that the pandemic, there have been pandemics\n\n1071\n00:45:30.540 --> 00:45:31.240\nbefore, there'll\n\n1072\n00:45:31.240 --> 00:45:33.080\nbe pandemics again.\n\n1073\n00:45:33.080 --> 00:45:37.620\nBut the thing that happened with this pandemic that was really different is we\n\n1074\n00:45:37.620 --> 00:45:38.280\nshut down the\n\n1075\n00:45:38.280 --> 00:45:42.360\neconomic engine of the world all over the world.\n\n1076\n00:45:42.360 --> 00:45:44.760\nAnd we kept it shut down for an extended period of time.\n\n1077\n00:45:44.760 --> 00:45:47.640\nAnd that created real imbalances in the world.\n\n1078\n00:45:47.640 --> 00:45:52.990\nAnd the way we compensated for that closure of economic activity was with\n\n1079\n00:45:52.990 --> 00:45:54.240\nmassive fiscal\n\n1080\n00:45:54.240 --> 00:46:00.170\nspending, fiscal stimulus to try to counterbalance some of the impacts of that\n\n1081\n00:46:00.170 --> 00:46:01.680\nbroad shutdown.\n\n1082\n00:46:01.680 --> 00:46:06.520\nAnd so the result of that was a real imbalance in the economy that we're now\n\n1083\n00:46:06.520 --> 00:46:08.160\ntrying to rebalance.\n\n1084\n00:46:08.160 --> 00:46:12.430\nIt's not surprising that that led to inflation to start to creep into the\n\n1085\n00:46:12.430 --> 00:46:13.120\neconomy.\n\n1086\n00:46:13.120 --> 00:46:17.620\nAnd then in early 2022, we had another out of the box event with a ground war\n\n1087\n00:46:17.620 --> 00:46:18.400\nin Europe,\n\n1088\n00:46:18.400 --> 00:46:23.280\nwhich obviously had enormous secondary implications to energy supplies, given\n\n1089\n00:46:23.280 --> 00:46:24.320\npolicy decisions\n\n1090\n00:46:24.320 --> 00:46:26.680\nthat have been made across the European continent.\n\n1091\n00:46:26.680 --> 00:46:31.800\nAnd so the combination of all this, along with increased geopolitical sensit\n\n1092\n00:46:31.800 --> 00:46:32.720\nivities around\n\n1093\n00:46:32.720 --> 00:46:37.330\nthe world, starting obviously with the US-China bilateral relationship, has\n\n1094\n00:46:37.330 --> 00:46:38.240\nreally shifted\n\n1095\n00:46:38.240 --> 00:46:39.840\nthe economic climate.\n\n1096\n00:46:39.840 --> 00:46:41.880\nAnd we're now resetting in a meaningful way.\n\n1097\n00:46:41.880 --> 00:46:46.200\nAnd so I think it's still uncertain how we navigate this.\n\n1098\n00:46:46.200 --> 00:46:51.110\nI would say the consensus view at the moment is becoming a little bit more dov\n\n1099\n00:46:51.110 --> 00:46:51.520\nish that\n\n1100\n00:46:51.520 --> 00:46:52.880\nwe can have a softer landing.\n\n1101\n00:46:52.880 --> 00:46:56.520\nIf you and I were speaking last summer, I probably would have said to you that\n\n1102\n00:46:56.520 --> 00:46:57.160\nthe chance of\n\n1103\n00:46:57.160 --> 00:47:01.120\nrecession in the United States is very high, almost certain in Europe.\n\n1104\n00:47:01.120 --> 00:47:05.330\nAnd now, if you look at our economists, our economists do not see a recession\n\n1105\n00:47:05.330 --> 00:47:06.080\nin the US,\n\n1106\n00:47:06.080 --> 00:47:10.290\nalthough I tell you, I still think there's a real possibility of one and a much\n\n1107\n00:47:10.290 --> 00:47:10.720\nlower\n\n1108\n00:47:10.720 --> 00:47:11.920\nchance of one in Europe.\n\n1109\n00:47:11.920 --> 00:47:16.160\nAnd so there's a scenario we can have a softer landing, but we're tightening\n\n1110\n00:47:16.160 --> 00:47:17.160\neconomic conditions\n\n1111\n00:47:17.160 --> 00:47:18.720\nvery quickly.\n\n1112\n00:47:18.720 --> 00:47:22.080\nWe have to rebalance the labor force.\n\n1113\n00:47:22.080 --> 00:47:24.840\nAnd generally, when that happens, you have a slowdown in economic growth.\n\n1114\n00:47:24.840 --> 00:47:28.000\nAnd so I think we have bumpier economic growth ahead.\n\n1115\n00:47:28.000 --> 00:47:31.240\nIt's obviously deflated asset prices.\n\n1116\n00:47:31.240 --> 00:47:35.480\nAnd I think we're going to have a tougher time with asset appreciation ahead.\n\n1117\n00:47:35.480 --> 00:47:39.000\nThe finance things is going to have a real cost to it again.\n\n1118\n00:47:39.000 --> 00:47:41.840\nWe haven't seen that in quite some time.\n\n1119\n00:47:41.840 --> 00:47:45.890\nAnd so I think you've got to expect, even though uncertainty exactly how it\n\n1120\n00:47:45.890 --> 00:47:46.480\nplays out\n\n1121\n00:47:46.480 --> 00:47:52.550\nin 2023, I think you've got to expect slower growth, less asset appreciation,\n\n1122\n00:47:52.550 --> 00:47:52.800\nkind of a\n\n1123\n00:47:52.800 --> 00:47:57.320\ntougher economic slog for a period of time here.\n\n1124\n00:47:57.320 --> 00:48:02.000\nAnd even though we might navigate through 2023 in a softer way than people\n\n1125\n00:48:02.000 --> 00:48:02.720\nmight have\n\n1126\n00:48:02.720 --> 00:48:07.400\nexpected six months ago, I do think in the next couple of years, it's not going\n\n1127\n00:48:07.400 --> 00:48:07.720\nto be\n\n1128\n00:48:07.720 --> 00:48:12.880\nback to the races of what we've kind of seen over the last 15 years in terms of\n\n1129\n00:48:12.880 --> 00:48:13.480\nmarkets\n\n1130\n00:48:13.480 --> 00:48:15.680\nand asset appreciation.\n\n1131\n00:48:15.680 --> 00:48:19.560\nAnd so all of those are slight headwinds to growth.\n\n1132\n00:48:19.560 --> 00:48:20.560\nSo I'm cautious.\n\n1133\n00:48:20.560 --> 00:48:22.880\nI'm generally a glass half full guy.\n\n1134\n00:48:22.880 --> 00:48:24.320\nI think we can navigate through this.\n\n1135\n00:48:24.320 --> 00:48:25.800\nWe will get through it.\n\n1136\n00:48:25.800 --> 00:48:30.360\nI think the geopolitical sensitivities are higher and those are also headwinds\n\n1137\n00:48:30.360 --> 00:48:31.060\nto growth.\n\n1138\n00:48:31.060 --> 00:48:33.140\nBut I think we just have to be a little bit more cautious.\n\n1139\n00:48:33.140 --> 00:48:39.140\nSo as leaders are running big businesses, you can plan for a more dovish\n\n1140\n00:48:39.140 --> 00:48:40.300\nscenario.\n\n1141\n00:48:40.300 --> 00:48:45.010\nBut I think you've got to be prepared in the way you operate your business for\n\n1142\n00:48:45.010 --> 00:48:46.100\nthe outcome\n\n1143\n00:48:46.100 --> 00:48:48.850\nthat we have some tougher economic times ahead of us in the next couple of\n\n1144\n00:48:48.850 --> 00:48:49.220\nyears.\n\n1145\n00:48:49.220 --> 00:48:51.380\nAnd I think most CEOs are doing just that.\n\n1146\n00:48:51.380 --> 00:48:54.450\nThey're being a little bit more cautious and a little bit more thoughtful given\n\n1147\n00:48:54.450 --> 00:48:54.780\nthe way\n\n1148\n00:48:54.780 --> 00:48:56.900\nthey look at that economic picture.\n\n1149\n00:48:56.900 --> 00:49:00.800\nBut I will say, the US economy, the European economy, they're proving to be\n\n1150\n00:49:00.800 --> 00:49:01.460\nrelatively\n\n1151\n00:49:01.460 --> 00:49:02.460\nresilient.\n\n1152\n00:49:02.460 --> 00:49:07.380\nEven in the light of a very quickly changing economic environment.\n\n1153\n00:49:07.380 --> 00:49:10.870\nYou know, David, I know you spent a lot of time with small businesses and you\n\n1154\n00:49:10.870 --> 00:49:11.180\nhosted\n\n1155\n00:49:11.180 --> 00:49:15.760\na, I think, around 10,000 small businesses in your New York headquarters in\n\n1156\n00:49:15.760 --> 00:49:16.500\nDecember.\n\n1157\n00:49:16.500 --> 00:49:22.060\nWhat specific advice do you have for people running these smaller businesses\n\n1158\n00:49:22.060 --> 00:49:22.820\ntoday?\n\n1159\n00:49:22.820 --> 00:49:27.270\nSo small businesses are such an important part of the engine of growth in the\n\n1160\n00:49:27.270 --> 00:49:28.220\nUS economy.\n\n1161\n00:49:28.220 --> 00:49:31.660\nSo as you know, and you highlighted it, we run a big program called 10,000\n\n1162\n00:49:31.660 --> 00:49:32.500\nsmall businesses\n\n1163\n00:49:32.500 --> 00:49:35.460\nthat provides business education for small businesses.\n\n1164\n00:49:35.460 --> 00:49:40.050\nAnd over the last 15 years, I think we've had 13 or 14,000 businesses across\n\n1165\n00:49:40.050 --> 00:49:40.500\nthe US go\n\n1166\n00:49:40.500 --> 00:49:45.650\nthrough it and keep a really good set of metrics on how they grow, how they\n\n1167\n00:49:45.650 --> 00:49:46.380\nhire, how they\n\n1168\n00:49:46.380 --> 00:49:47.940\nexpand coming out of it.\n\n1169\n00:49:47.940 --> 00:49:54.270\nAnd the best advice for small businesses is to try to take a long-term view\n\n1170\n00:49:54.270 --> 00:49:55.220\ntoward building\n\n1171\n00:49:55.220 --> 00:49:56.220\nyour business.\n\n1172\n00:49:56.220 --> 00:50:00.830\nSure, you understand the business and economic model of the business and the\n\n1173\n00:50:00.830 --> 00:50:01.700\nbusiness can\n\n1174\n00:50:01.700 --> 00:50:04.900\nreally drive a margin or an economic model.\n\n1175\n00:50:04.900 --> 00:50:07.700\nA lot of people start businesses because they have a good idea, but they haven\n\n1176\n00:50:07.700 --> 00:50:08.140\n't really\n\n1177\n00:50:08.140 --> 00:50:11.820\nthought through how the economics of the business work.\n\n1178\n00:50:11.820 --> 00:50:14.430\nSo make sure you really understand the economics of the business and the\n\n1179\n00:50:14.430 --> 00:50:15.060\neconomics of the\n\n1180\n00:50:15.060 --> 00:50:19.540\nbusiness can support your plan and try to plan, try to get help, try to find\n\n1181\n00:50:19.540 --> 00:50:20.340\nmentors,\n\n1182\n00:50:20.340 --> 00:50:24.180\npeople that have experience that can help you broaden your experience.\n\n1183\n00:50:24.180 --> 00:50:28.080\nMost entrepreneurs of small businesses have certain skills, but they don't\n\n1184\n00:50:28.080 --> 00:50:28.780\nnecessarily\n\n1185\n00:50:28.780 --> 00:50:32.450\nhave the broad range of skills that are necessary as business as scale, whether\n\n1186\n00:50:32.450 --> 00:50:33.100\nit's finance\n\n1187\n00:50:33.100 --> 00:50:36.740\nand planning skills, budgeting skills.\n\n1188\n00:50:36.740 --> 00:50:40.650\nThink about how you can find ways to get mentors that can help you with those\n\n1189\n00:50:40.650 --> 00:50:41.060\nthings\n\n1190\n00:50:41.060 --> 00:50:45.730\nand really make sure you understand the base economic model and the base\n\n1191\n00:50:45.730 --> 00:50:46.860\neconomic model\n\n1192\n00:50:46.860 --> 00:50:50.130\nworks and then pour your heart and soul into it because running a small\n\n1193\n00:50:50.130 --> 00:50:50.940\nbusiness is not\n\n1194\n00:50:50.940 --> 00:50:51.940\neasy.\n\n1195\n00:50:51.940 --> 00:50:52.940\nAbsolutely.\n\n1196\n00:50:52.940 --> 00:50:57.630\nAmong other things, it takes an enormous commitment and an enormous amount of\n\n1197\n00:50:57.630 --> 00:50:58.020\npassion.\n\n1198\n00:50:58.020 --> 00:51:03.460\nI know you attend the World Economic Forum in Davos.\n\n1199\n00:51:03.460 --> 00:51:07.780\nWhat's a big insight that you've walked away from that experience?\n\n1200\n00:51:07.780 --> 00:51:15.190\nI just came back from Weff last week and I'd say the biggest thing that I get\n\n1201\n00:51:15.190 --> 00:51:15.980\nout of it\n\n1202\n00:51:15.980 --> 00:51:21.300\neach year is it gives me an opportunity and a very condensed period of time to\n\n1203\n00:51:21.300 --> 00:51:22.140\nshare views\n\n1204\n00:51:22.140 --> 00:51:25.340\nwith lots of business leaders and government officials.\n\n1205\n00:51:25.340 --> 00:51:29.620\nI would say in a two and a half day period of time, I had over 30 bilateral\n\n1206\n00:51:29.620 --> 00:51:30.500\nmeetings.\n\n1207\n00:51:30.500 --> 00:51:37.180\nWe hosted two dinners that had over 60 government leaders or CEOs present.\n\n1208\n00:51:37.180 --> 00:51:41.150\nIn the context of that, it's a great opportunity to listen, learn and compare\n\n1209\n00:51:41.150 --> 00:51:41.900\nnotes and try\n\n1210\n00:51:41.900 --> 00:51:44.820\nto get a sense of how people feel.\n\n1211\n00:51:44.820 --> 00:51:50.850\nMy biggest takeaway is always kind of a gauge on how people feel at that moment\n\n1212\n00:51:50.850 --> 00:51:51.060\n.\n\n1213\n00:51:51.060 --> 00:51:55.060\nI would say that sometimes there's a correlation to how people feel and how the\n\n1214\n00:51:55.060 --> 00:51:56.180\neconomic scenario\n\n1215\n00:51:56.180 --> 00:51:58.260\nplays out in the year.\n\n1216\n00:51:58.260 --> 00:52:01.130\nSometimes it turns out not to be correlated, but it's helpful to understand\n\n1217\n00:52:01.130 --> 00:52:01.660\nthat because\n\n1218\n00:52:01.660 --> 00:52:05.070\nif you understand how people feel and you start to think about the inputs that\n\n1219\n00:52:05.070 --> 00:52:05.580\nare driving\n\n1220\n00:52:05.580 --> 00:52:10.780\nthat sentiment, it sometimes can give you better insight into economic activity\n\n1221\n00:52:10.780 --> 00:52:11.620\nbroadly.\n\n1222\n00:52:11.620 --> 00:52:16.520\nI really use it as a way to both connect with people and keep those connections\n\n1223\n00:52:16.520 --> 00:52:17.140\nreal.\n\n1224\n00:52:17.140 --> 00:52:20.720\nI think when you sit down with people in person, that strengthens the\n\n1225\n00:52:20.720 --> 00:52:21.860\nconnection, the bond\n\n1226\n00:52:21.860 --> 00:52:25.690\nyou have, but also to walk away with a sentiment view which helps me a little\n\n1227\n00:52:25.690 --> 00:52:26.540\nbit because it's\n\n1228\n00:52:26.540 --> 00:52:31.180\nin January, think about the year and think about the direction of travel for\n\n1229\n00:52:31.180 --> 00:52:31.980\nthe year.\n\n1230\n00:52:31.980 --> 00:52:37.110\nAs we close, I'd love to have you leave us with a story that highlights what's\n\n1231\n00:52:37.110 --> 00:52:37.980\npossible.\n\n1232\n00:52:37.980 --> 00:52:43.560\nIf you enjoy the ride, whether in your career or in your life, you're a grinder\n\n1233\n00:52:43.560 --> 00:52:44.340\n, you're\n\n1234\n00:52:44.340 --> 00:52:46.340\na competitor.\n\n1235\n00:52:46.340 --> 00:52:50.180\nThe ever, what do you do to just enjoy what's happening?\n\n1236\n00:52:50.180 --> 00:52:53.420\nIs that something that you even take time to think about?\n\n1237\n00:52:53.420 --> 00:52:56.600\nI do think about it, David, and it's a great question and I appreciate you\n\n1238\n00:52:56.600 --> 00:52:57.260\nasking it.\n\n1239\n00:52:57.260 --> 00:53:03.500\nI first and foremost, I have two beautiful daughters and a wonderful family and\n\n1240\n00:53:03.500 --> 00:53:03.940\nlots\n\n1241\n00:53:03.940 --> 00:53:08.850\nof great friends in the world and those things have always been important to me\n\n1242\n00:53:08.850 --> 00:53:09.100\nthrough my\n\n1243\n00:53:09.100 --> 00:53:13.000\njourney and coming out of school and building my career and they always will be\n\n1244\n00:53:13.000 --> 00:53:13.620\nthe number\n\n1245\n00:53:13.620 --> 00:53:15.060\none priority.\n\n1246\n00:53:15.060 --> 00:53:16.660\nBut I love my job.\n\n1247\n00:53:16.660 --> 00:53:17.660\nI love the business.\n\n1248\n00:53:17.660 --> 00:53:19.100\nI've always loved the business.\n\n1249\n00:53:19.100 --> 00:53:22.180\nI never really envisioned that I'd wind up in this seat.\n\n1250\n00:53:22.180 --> 00:53:28.100\nI think I wound up in the seat through a convergence of hard work over a long\n\n1251\n00:53:28.100 --> 00:53:29.500\nperiod of time and\n\n1252\n00:53:29.500 --> 00:53:31.540\nan awful lot of luck.\n\n1253\n00:53:31.540 --> 00:53:37.480\nBeing more important because I think timing and serendipity play a lot in the\n\n1254\n00:53:37.480 --> 00:53:38.320\nway these\n\n1255\n00:53:38.320 --> 00:53:39.820\nthings play out.\n\n1256\n00:53:39.820 --> 00:53:41.620\nBut I've enjoyed the people I've met.\n\n1257\n00:53:41.620 --> 00:53:45.060\nI've enjoyed the intellectual stimulation.\n\n1258\n00:53:45.060 --> 00:53:51.100\nI try on a day-to-day basis to really relish the parts of the job and the parts\n\n1259\n00:53:51.100 --> 00:53:51.660\nof the\n\n1260\n00:53:51.660 --> 00:53:55.800\nexperience that I love, which is really the interaction with people, the\n\n1261\n00:53:55.800 --> 00:53:56.700\nstrategic thought\n\n1262\n00:53:56.700 --> 00:54:02.200\nprocess and really debating and thinking about the strategic agenda and then\n\n1263\n00:54:02.200 --> 00:54:03.380\ntrying to execute\n\n1264\n00:54:03.380 --> 00:54:05.380\non it.\n\n1265\n00:54:05.380 --> 00:54:09.430\nI try when it's more difficult and it can be, as you know, difficult from time\n\n1266\n00:54:09.430 --> 00:54:10.100\nto time,\n\n1267\n00:54:10.100 --> 00:54:13.820\nthe tough quarters, some of the visibility that comes with it.\n\n1268\n00:54:13.820 --> 00:54:18.780\nI try to segregate those things and put them aside and just realize that the\n\n1269\n00:54:18.780 --> 00:54:19.420\njob is to\n\n1270\n00:54:19.420 --> 00:54:25.900\nwake up every day, to do the best that you can do, to be true to who you are.\n\n1271\n00:54:25.900 --> 00:54:31.510\nIf you do those things, you're probably going to do just fine and embrace\n\n1272\n00:54:31.510 --> 00:54:32.660\npeople, listen\n\n1273\n00:54:32.660 --> 00:54:36.760\nto people, bring in different points of view and try to do everything you can\n\n1274\n00:54:36.760 --> 00:54:37.340\nto just keep\n\n1275\n00:54:37.340 --> 00:54:38.940\nmoving forward.\n\n1276\n00:54:38.940 --> 00:54:43.890\nWhat would be the one piece of advice you'd give to anyone who wants to improve\n\n1277\n00:54:43.890 --> 00:54:46.140\nas a leader?\n\n1278\n00:54:46.140 --> 00:54:48.300\nLeaders grow and evolve.\n\n1279\n00:54:48.300 --> 00:54:51.360\nThere's not one leadership style and everybody's leadership style has to grow\n\n1280\n00:54:51.360 --> 00:54:51.980\nand evolve.\n\n1281\n00:54:51.980 --> 00:54:58.950\nI think all of us as leaders have to be very self-reflective and be willing to\n\n1282\n00:54:58.950 --> 00:54:59.900\nlisten to\n\n1283\n00:54:59.900 --> 00:55:04.780\nnot just the good stuff that comes in, but the critical stuff too.\n\n1284\n00:55:04.780 --> 00:55:08.650\nYou've got to be able to not be overly sensitive to criticism and try to\n\n1285\n00:55:08.650 --> 00:55:09.820\nconstantly figure\n\n1286\n00:55:09.820 --> 00:55:15.290\nout how can I evolve as a human being, how can I grow, how can I expand my\n\n1287\n00:55:15.290 --> 00:55:16.220\ncapacity,\n\n1288\n00:55:16.220 --> 00:55:19.310\nand then you also have to be willing to make difficult decisions and understand\n\n1289\n00:55:19.310 --> 00:55:19.700\nwhen you\n\n1290\n00:55:19.700 --> 00:55:21.620\nmake difficult decisions.\n\n1291\n00:55:21.620 --> 00:55:24.300\nThey're not always going to be popular.\n\n1292\n00:55:24.300 --> 00:55:27.620\nLeadership is about taking people where they don't want to go.\n\n1293\n00:55:27.620 --> 00:55:29.990\nIf you're taking them to a place where they're going on their own, they don't\n\n1294\n00:55:29.990 --> 00:55:30.540\nreally need\n\n1295\n00:55:30.540 --> 00:55:32.380\nyour leadership.\n\n1296\n00:55:32.380 --> 00:55:35.860\nWhen you have to make difficult leadership decisions, there are going to be\n\n1297\n00:55:35.860 --> 00:55:36.140\ntimes when\n\n1298\n00:55:36.140 --> 00:55:41.840\npeople doubt and people criticize and you have to be willing to listen to that\n\n1299\n00:55:41.840 --> 00:55:42.420\nand absorb\n\n1300\n00:55:42.420 --> 00:55:45.840\nit and make sure you're doing the right thing, but you also have to stay true\n\n1301\n00:55:45.840 --> 00:55:46.900\nto your convictions\n\n1302\n00:55:46.900 --> 00:55:50.340\nand not let the noise take you off course.\n\n1303\n00:55:50.340 --> 00:55:54.940\nI try every day to listen, but I also try every day to have a lot of conviction\n\n1304\n00:55:54.940 --> 00:55:55.140\nabout\n\n1305\n00:55:55.140 --> 00:55:59.540\nthe things that we want to do and try to move forward slowly and steadily.\n\n1306\n00:55:59.540 --> 00:56:03.750\nIt's not a straight line and it's certainly, it's a marathon, not a sprint,\n\n1307\n00:56:03.750 --> 00:56:04.700\nDavid, as you\n\n1308\n00:56:04.700 --> 00:56:05.700\nall know.\n\n1309\n00:56:05.700 --> 00:56:10.900\nDavid, every time I get the opportunity to talk to you, it strikes me from the\n\n1310\n00:56:10.900 --> 00:56:11.860\nconversation\n\n1311\n00:56:11.860 --> 00:56:16.580\nthat we have, how modern your thinking is and how focused you are in taking\n\n1312\n00:56:16.580 --> 00:56:17.580\nGoldman Sachs\n\n1313\n00:56:17.580 --> 00:56:18.980\nin the future.\n\n1314\n00:56:18.980 --> 00:56:23.630\nYou've got this great historic company, but I love your focus on being really\n\n1315\n00:56:23.630 --> 00:56:24.580\ncontemporary\n\n1316\n00:56:24.580 --> 00:56:27.420\nand pushing the envelope with new thinking.\n\n1317\n00:56:27.420 --> 00:56:32.320\nI really appreciate you taking the time to share your thoughts and insights\n\n1318\n00:56:32.320 --> 00:56:33.100\nwith us.\n\n1319\n00:56:33.100 --> 00:56:33.940\nThank you very much, David.\n\n1320\n00:56:33.940 --> 00:56:34.500\nI appreciate it.\n\n1321\n00:56:34.500 --> 00:56:46.830\nHonestly, I mean, how many people have what it takes to be both the top CEO and\n\n1322\n00:56:46.830 --> 00:56:48.020\na great\n\n1323\n00:56:48.020 --> 00:56:49.020\nDJ?\n\n1324\n00:56:49.020 --> 00:56:53.190\nI mean, that's a pretty extraordinary overlap of skills, but hey, David is a\n\n1325\n00:56:53.190 --> 00:56:54.540\npretty extraordinary\n\n1326\n00:56:54.540 --> 00:56:59.270\nguy and he dropped some serious wisdom on us today, including how important it\n\n1327\n00:56:59.270 --> 00:56:59.740\nis for\n\n1328\n00:56:59.740 --> 00:57:02.300\nleaders to take a longer perspective.\n\n1329\n00:57:02.300 --> 00:57:05.900\nI know we all face short term pressures.\n\n1330\n00:57:05.900 --> 00:57:10.010\nIt takes a lot of courage to bring long term thinking to the table, but it's\n\n1331\n00:57:10.010 --> 00:57:11.380\nkey to sustainability\n\n1332\n00:57:11.380 --> 00:57:15.350\nand success, especially when it comes to earning the trust of your customers\n\n1333\n00:57:15.350 --> 00:57:16.220\nand building a\n\n1334\n00:57:16.220 --> 00:57:18.580\nstrong company culture.\n\n1335\n00:57:18.580 --> 00:57:23.820\nSo let me ask you, what's one practical way that you can take a longer view?\n\n1336\n00:57:23.820 --> 00:57:28.130\nConsider this, in your regular check-ins with your team, what percentage of\n\n1337\n00:57:28.130 --> 00:57:28.860\nyour time do\n\n1338\n00:57:28.860 --> 00:57:33.120\nyou spend talking about the immediate day to day stuff and how much of the\n\n1339\n00:57:33.120 --> 00:57:33.860\nmeeting do\n\n1340\n00:57:33.860 --> 00:57:38.740\nyou devote to discussing big long term goals and challenges?\n\n1341\n00:57:38.740 --> 00:57:43.650\nIt's your job as a leader to facilitate long term thinking and that's a simple\n\n1342\n00:57:43.650 --> 00:57:44.260\nway you\n\n1343\n00:57:44.260 --> 00:57:48.430\ncan get your team to look past the short term pressures and see what's in the\n\n1344\n00:57:48.430 --> 00:57:49.340\ndistance.\n\n1345\n00:57:49.340 --> 00:57:51.500\nSo do you want to know how leaders lead?\n\n1346\n00:57:51.500 --> 00:57:55.860\nWhat we learned today is that great leaders take the long view.\n\n1347\n00:57:55.860 --> 00:58:01.010\nComing up next on How leaders lead is Oscar Munoz, former CEO of United\n\n1348\n00:58:01.010 --> 00:58:02.140\nAirlines.\n\n1349\n00:58:02.140 --> 00:58:06.830\nWe can get caught up in ourselves, our intellect, our strategic mindset, our\n\n1350\n00:58:06.830 --> 00:58:08.140\neducation and learning\n\n1351\n00:58:08.140 --> 00:58:13.910\nand how to present things logically and attack the mind and trying to solve\n\n1352\n00:58:13.910 --> 00:58:14.820\nissues.\n\n1353\n00:58:14.820 --> 00:58:19.310\nWe also learn over time that the path to true engagement and true release of\n\n1354\n00:58:19.310 --> 00:58:20.780\nsomeone's discretionary\n\n1355\n00:58:20.780 --> 00:58:25.020\neffort is not only capturing the mind, but the heart as well.\n\n1356\n00:58:25.020 --> 00:58:29.540\nSo be sure to come back again next week to hear our entire conversation.\n\n1357\n00:58:29.540 --> 00:58:33.380\nThanks again for tuning in to another episode of How leaders lead where every\n\n1358\n00:58:33.380 --> 00:58:34.140\nThursday you\n\n1359\n00:58:34.140 --> 00:58:38.500\nget to listen in while I interview some of the very best leaders in the world.\n\n1360\n00:58:38.500 --> 00:58:42.380\nI make it a point to give you something simple on each episode that you can\n\n1361\n00:58:42.380 --> 00:58:43.180\napply to your\n\n1362\n00:58:43.180 --> 00:58:46.420\nbusiness so that you will become the best leader you can be.\n\n1363\n00:58:46.420 --> 00:58:56.420\n[BLANK_AUDIO]\n\n1364\n00:58:56.420 --> 00:59:06.420\n[BLANK_AUDIO]","

David Novak 0:04

Welcome to How leaders lead where every week you get to listen in while I interview some of the very best leaders in the world, I break down the key learning so that by the end of the episode, you'll have something simple you can apply as you develop into a better leader. That's what this podcast is all about. You know, I think every good leader feels that pressure to deliver, people want results in they want them now. But that can make it really easy to get short sighted. Sometimes we don't really give ourselves permission to look down the road and think about the long term. But if you want success that's actually sustainable. You've got to learn how to take a longer view of things. And that's why I'm excited for you to hear from my guest today, David Solomon, he's the CEO of Goldman Sachs, one of the most renowned companies in the financial industry. Now, look, David faces a lot of short term pressures, but those don't keep him from looking ahead and taking a long term approach. Of course, that's never easy. It takes a heck of a lot of courage. But in this conversation, you're going to learn how it's done, and why it's crucial for any leader who wants to build trust and be a part of something that lasts. Plus, David's got some insights into the economy that you do not want to miss. He explains from his perspective, what's really been going on over the last few years and what leaders need to be doing to prepare for what's coming. So let's jump right in. Here's my conversation with my good friend head soon to be yours, David Solomon.

David Novak 1:35

always like to start out at the beginning. Tell us about your upbringing.

David Solomon 1:39

Sure. I grew up outside of New York City. in Westchester County in Hartsdale, New York, I went to public high school, in that area, my father, owned and ran with a partner, a financial printing business that was based in Manhattan for most of my childhood and my, my mother was an audiologist, she had an audiology practice at the Burke Rehabilitation Hospital in White Plains. So I would say it was a very middle of the road, middle class upbringing,

David Novak 2:07

tell us about a story that from your childhood days that, you know, probably shaped who you are today?

David Solomon 2:12

Sure, well, I'm asked often about, you know, people that have had a big influence. And certainly my parents had a very, very big influence, my mom had, you know, extraordinary drive an extraordinary capacity to, to handle a lot. And my dad was just really a great mentor, my dad was someone who really, really believed that you didn't tell your kids what to do, you try to give them a lot of rope, give them an opportunity to learn from their mistakes, and provide guidance and support, you know, as they navigated the world. And I, you know, there's a story I've told a handful of times, just where I think my dad had a profound impact on how I've managed my life. And in particular, my time professionally over the years, this goes back to my being in high school, and really having a lot on my plate and complaining to my father, that I couldn't get it all done. And he told me to take out a calendar, an old classic calendar with big square boxes you could write on, he said, take the next month, and I want you to write down in each day, everything you have to do each day, including sleeping, eating, going to school, studying, etc. You know, try to fill every minute of the day up and see where you wind up. And what I discovered, you know, through that exercise, was I spent a lot of time doing nothing sitting on the couch watching television, just hanging out with my friends after school. And then if you actually were thoughtful or purposeful, with respect to how you'd spend your time, there actually was a lot of time in the day to get a lot done. And that experience as a 17 year old, had a profound impact on my kind of rethinking how I spend my time, and I've carried it with me up till today, I think you got to be very purposeful in how you choose to spend your time. And if you are there's there's a lot of time to get a lot accomplished.

David Novak 4:01

That's great. You know, what did you want to be when you grew up? When you were a kid? Did you did you know what you wanted to be?

David Solomon 4:07

You know, when I was when I was really little I wanted to be a garbage man. Because when I was really little I stand on the corner and watch the garbage trucks go by. But I probably along the way, like most young boys growing up in the 60s probably want to be a fireman at some point. But I think from a more reasonable perspective, as I entered high school in college, you know, I thought I would go to law school. I always, for some reason, my parents, my mother in particular really thought at that point in time you needed to be a professional. And there were two kinds of professionals, doctors and lawyers. And in that context, I just wasn't really that interested in the physical sciences in school. So the law seemed seem more interesting, but somewhere along the way, it didn't pan out that way.

David Novak 4:50

Tell us about the moment you decided that you wanted to take the finance track. Did you have that aha magic moment.

David Solomon 4:57

The AHA moment that tying it back to Uh, the story about going to law school, I didn't do great on my law boards. And probably I didn't do great on him because I was out the night before having fun with my friends, instead of, you know, being in studying or being more focused. But I didn't do great on my law boards. And when it came time to apply to law school, I kind of looked at where I was. And I said, you know, I, if I really want to really put the effort into this, I got to get more focused on it. But I need a job. I'm getting out of school. And at that point in time, you know, finance was just starting, this was 1983, finance was just starting to expand the amount of hiring it was starting to do, the markets were starting to open up. And a lot of banks were offering programs to come to New York and get some training, bunch of my friends were moving in this direction. And I kind of stumbled into it because it was an easy opportunity to stumble into. And so I, I got a job out of school interviewing on campus and Hamilton College, to go work for the Irving Trust Company, which was an old line commercial bank that was running a training program. And I really didn't know a lot of what banking was or what finance would be. But it was a good job. And off, I went and got some training. And that kind of started me on my way.

David Novak 6:15

Is it something that you really enjoyed tremendously when you got into it?

David Solomon 6:19

Well, that's what I think it really it really changed. I went to work at the Irving Trust Company. And I went through the training. And there were things about finance that I discovered, oh, I have a capacity or an interest in that got interesting. But I went through the training for a year. And then I got placed in the bank. And at that point of time is you know, you'd Well remember, most people had to go back to business school. And so I was going through the process of applying to business school, this would have been in 1985, early 1986, when I got a job offer to go work at Drexel Burnham. And so I looked at that job opportunity. I was like, this is pretty interesting job opportunity. Drexel was pretty visible and prominent. We all know the story of where it wound up. But it was pretty visible and prominent on the rise then. And I decided to take that opportunity. And that opportunity kind of opened up over the next five years, a great opportunity for me to really understand what it meant to be in the middle of finance, I learned a lot, I grew a lot I did very well. And that was kind of the moment where I said, You know what, you know, I like this, I think there's something here for me, that's more meaningful. Now, of course, in 1990, Drexel Burnham went out of business, and I had skipped business school at that point in time. So you know, it was clear that I then had to navigate what was next. But I was pretty hooked at the moment that I was going to pursue a career in finance. At that point, I was in my late 20s. And I was gonna stay on that path.

David Novak 7:43

You know, people have to navigate their career in terms of what's next. And you had this experience at Drexel. What process did you use? Or what advice could you give to someone on how to navigate what's next, where you go to to leverage your skills and what you happen to really like doing?

David Solomon 7:58

You know, it's interesting, because one of the things that I see now is I have a lot of young people coming to me for advice. And it feels to me, like people are much more in a hurry to figure out what's the next step in their career, as opposed to really experience the ride, you know, of their career, but I always try to advise people to think about, one are you learning? Are you learning, growing, gaining skills and experience that are really adding to what you know, and are really broadening the lens that you look through professionally, too? Are you working with people that you like and enjoy? And are you creating a professional network that you think is also, you know, opening up longer term opportunity for you? And three, are you having some fun, you know, both on a day to day basis, and, you know, with those people that are really an important part of your life, because you spending a lot of time with him that if those three things are in place 60 to 70% of the time, it's probably pretty good job. You know, write it a little bit, you know, don't worry so much about what's next, but rather, you know, see what comes your way because you kind of stay put and develop some consistency in what you're doing. And so, I'm a big believer in taking the long road investing, good things happen when people you know, take kind of a longer, slower perspective. I'm a little bit of a tortoise as opposed to a hare.

David Novak 9:22

What came your way after Drexel that that excited you? Well, I

David Solomon 9:26

found my way to Bear Stearns and by the way, you know, there's no pattern developing because, you know, to institutions that are no longer around today. But I found my way to Bear Stearns and had a very interesting run for eight or nine years of Bear Stearns through the 90s. Where because of some of the skills and autonomy and the entrepreneurial nature of the industry at the time, it really was an industry that was driven by what you produced. And you know, I became a relatively big producer and Bear Stearns in my early 30s In the early 90s and rose to the top of that organization. And by my mid 30s, I was on the Management Committee of that organization and was running the investment banking business, their small investment banking business compared to Goldman Sachs. But I started to have some real success and get some real visibility around the industry. And it was through that, that in 1999, Goldman Sachs came to recruit me to Goldman Sachs. You know, given some of the interactions I've had with the firm, during my experience there, you want to ask

David Novak 10:25

yourself that you mentioned you didn't have an MBA? How much anxiety did that create for you, when you're coming up in a world where everybody seems to have an MBA?

David Solomon 10:33

I mean, that's a very insightful question. And the honest answer is, at the time, a lot, it didn't seem like an inappropriate choice, when I was working at Drexel, and everything was working, and I was ahead of, and making more money than my peers who are going to business school or just coming out of business school. But when Drexel went out of business, and I started interviewing for jobs, I felt it and it made me nervous. And, you know, I think it affected the choices that were available to me, I think if, you know, being in my late 20s, and not having an MBA limited, at that time, some of the choices that were available to me, I obviously landed on my feet and found my way. And ultimately, and I think this is really true, ultimately, experience and credibility became more important than what schools I went to or what degrees I had. But at the time, I remember being nervous about it. And I do think that's been tempered, I think the world is much more open. I think a place like Goldman Sachs is much more open than it used to be. And in fact, not only are we more open from a diversity perspective, we want people from a much broader array of schools and experiences in the organization than the organization did 20 years ago. But at the time, that felt like eliminate thing, it was a less traditional path. Certainly in my generation, it was a less traditional path.

David Novak 11:53

But you leverage your experience, you were a producer, you brought forward the great results, and you're a very senior position at Bear Stearns, what made you ultimately make the move to Goldman Sachs, which is at a senior level I know is doesn't happen very often.

David Solomon 12:09

What was unusual, it happens a little bit more today. But at the time, I was hired as a partner at Goldman Sachs in 1999. And at the time, that was something that the firm did not do that often. But I think the leadership of the firm at the time, Hank Paulson, at the time, it was John Thornton and John Thain working for hands, they really thought that the firm was going to become a public company, it was becoming a much broader, more global business. And the firm would benefit from a diversity of experience and actually having some people that hadn't grown up, starting right out of school, you know, inside the firm. And so at the time, the firm went out hired a handful of people as partners, and I got swept in, you know, in the context of that. So it was unusual, but it was, it was also, and again, this goes to the long term thinking, you know, Goldman just had, in my own mind, such a place in the industry, that it was kind of like an opportunity to play for the Yankees. And I was 37 years old at the time, I really loved the industry and was kind of committed to a career in it. And I saw this as an opportunity to really go work with the best and the brightest, but it required me to take a step back professionally, I, you know, I was on the Management Committee of a firm a very, very big job. And I went to run a business that I had run, it was bigger than the one that Bear Stearns, but was a business I'd run seven years earlier. And I started at a at a lower position in the partnership, but I decided, you know, what, I, this is something that I think will be good for me with a long term view. And it turned out to be a wise decision.

David Novak 13:43

Absolutely. You know, you had obviously had seen your sponsorship, you know, when you're brought in as a partner, but you come in as an outsider in a company that didn't really bring in partners from the outside? How did your peers view you and other people in the company? Was that hard for you? How do you adjust to that,

David Solomon 13:59

you know, I think that actually turned out to be easier than I expected. You know, the culture here is extremely collaborative. And I remember at the time feeling really embraced and really open, I think there was an ethos here in the partnership with the firm that we weren't going to do that often. But when we did choose to do it, if we chose to do it, we were really going to embrace those people and make sure it worked. Because if we didn't embrace them, and it didn't work, you know, we'd lose that, you know, that ability to attract people. Now, in the context of bringing people along, I think I interviewed with 20 or 25 partners, before I was hired. So there's certainly a lot of people that I spent time with and felt some connection or ownership, but it actually went better than I thought although the one thing I would highlight whenever the partnership got together. They used to grab us and they'd say, let's get the outsiders. Let's get the lateral hires. And let's get them to talk about what's different about this. And, you know, I sat on those panels for 10 or 15 years before finally it progressed. I was you know, it was no longer a lateral hire. It took you a while to be an insider Although still today still today, I am the CEO but a lot of people walk around. You're the CEO who has a lateral hires. So, you know, I don't think you ever lose that moniker Goldman Sachs.

David Novak 15:12

Now you listen to this podcast so you know how much I love learning about leadership from some of the world's greatest leaders. We make it a priority to break down the insights from our guests into practical steps so you can apply what you learned from our episodes into your own leadership style. A lot of times though, it can be easy to listen to an episode and forget what you learned. That is exactly why I created the weekly leadership plan. Every Sunday, I send out a weekly leadership plan that lays out in three simple steps, the key learnings from that week's podcast, it only takes about five minutes to read. And it gives you practical steps you can apply to your leadership process for that week, like everything we do at how leaders lead is completely free. And you can sign up for it at how leaders lead.com Right now, this weekly leadership plan is a great way to prepare for your week, each Sunday evening. And I hope you'll sign up today at how leaders lead.com/plan.

You know, when you love Bear Stearns, Did you learn anything from that experience that you think about, you know, when you're dealing with people and managing people and trying to keep your highest performers because obviously, Bear Stearns did not want to lose you you were at the highest ranks of the company. So did you learn anything that allows you to manage or is it helps you manage to really top performers better?

David Solomon 16:44

Well, the real contrast to Bear Stearns, the way Bear Stearns operated and Goldman Sachs, the way Goldman Sachs operated. And it's actually, I think, one of the reasons I mean, Bear Stearns was around for a long time, but it's not around today. And Goldman Sachs has been around a long time and it is around today. And you know, Bear Stearns never made the transition from being a very tightly controlled partnership to an institutional firm. And while Goldman Sachs always retained the partnership culture, it really spread out decision making authority, and really held people accountable in a very horizontal collaborative way. And, you know, Bear Stearns didn't do that, Bear Stearns was run by a handful of people, it was extremely tight. And as a result, you were either in this very, very small group or you weren't, it seemed to work fine when I was there, but I can really see the contrast, and a collaborative partnership culture where you're really trying to empower the organization in a horizontal way. And, you know, I think I learned that in these kinds of professional services businesses, that empowerment is super important. I'd also say one of the things culturally that this firm has Excel, that is there's a deeply rooted culture of risk management, that really empowers the control side of the firm, to have an equal balance with the producing side of the firm. And I think that matters in the sustainability of these organizations. And so that's something else that I observed that was different that I think's been a real attribute of this platform.

David Novak 18:15

David, you followed some really legendary leaders and CEOs at Goldman, you know, what do you think are the defining qualities of the best leaders who have led the firm?

David Solomon 18:25

Well, as people, they're all we're all different. I was gonna say they're all different. But now I guess I can include myself in that, in that august group, although I certainly have a lot of work to do to earn their standing. As people, we're all different. But I do think there are a handful of things that even though the styles can be different their core to successful leadership in an organization like this, the first is you've got to bring people along with you. And you've got to find a way to communicate your vision, and get people to exchange an open debate and open challenge, but ultimately arrive at a conclusion as to the direction that you're going to go and want to go with you. And whether it's been Hank, or it's been Lloyd, or, you know, even many before that, you know, this organization operates in a collaborative way, that encourages, you know, open challenge, but also the need for people to come along. And I think that's a very important aspect of, of leadership. I think in the world we live in today, transparency and communication are increasingly important on the part of leaders. And you've got to be able to get your messages out in a real time basis, much more frequently than you used to the transparency with respect to everything you do, and everything that you say is much, much higher. And so I think you've got to be very, very thoughtful and your whole communication strategy and the way you make sure people understand the direction that you want the organization to go. And last, I think is the world shifting and you can look at Goldman Sachs as an example, this 60% of the employees here are 30 years old or less 74% of millennial or Gen Z. You know, they want to see people, as human beings as authentic, you know, in their leadership. And I think you just have to be much more open as a person to successfully get the younger generation that's coming up in these organizations to want to be a part of it. And they want to know what you stand for and who you are not just what you're doing in the company.

David Novak 20:29

You do a lot of innovative things on that front. I want to get to that a little bit later. You know, I remember that the late John Weinberg, he was former partner, he was on our Yum brands board. And I remember him being, you know, you came in as a partner, but I remember him being very concerned about Goldman moving from a partnership model to a public company. How do you think that's worked out?

David Solomon 20:53

Well, I understand, you know, why John Weinberg had concerns because it's such a, it's such a core part of what Goldman Sachs was, and Goldman Sachs held off longer than anyone else. Because all these businesses were partnership structures. At one point, Goldman Sachs held off longer than anyone else, in terms of making the switch to being a public company. But what I'd have to say is, I think it worked out very well, because Goldman Sachs wouldn't be Goldman Sachs, if it hadn't gone public, the world changed the amount of capital that was necessary in these businesses to compete on a global scale changed. And there was no way that you could operate at a global scale in these businesses. Without being a public company, partner capital was not going to sustain it. So the choice became, being a smaller niche, your organization, or being a true global player, we chose being a true global player. And it was that transition that allowed that I think the thing that we have done that unique is unlike any other organization, we've retained the partnership and a public company structure. And I think it's been a huge asset to the firm.

David Novak 22:00

You know, Goldman Sachs is probably most famous for its historical client first culture. It's not so much about the individual but all about bringing a team together to find the right answer for the client. How would you describe that that culture today? And and what are you really trying to do to evolve the culture to make the firm even more successful? Yeah,

David Solomon 22:23

so it's still a hugely important part of the culture of the organization. And I'd say that focus on the client, and really thinking about the client's interests is the TrueNorth of this organization. It's always been important. But I think the big thing that we're focused on now, and really, I've been trying to emphasize is the idea of delivering the whole firm to our clients in a much more unified way. So when you were young, as the CEO of yum brands, you generally dealt with our investment banking business. But as the world's got more complicated, we have a lot of clients on a global bases that deal with us across investment banking, across our market, making businesses across our asset management business. And that integration and the way we deliver that for a long time, the firm really ran in divisions. And you dealt even though a team, there was a team approach in that division, you really dealt in silos in the firm. And so we've been really talking about one GS is core to our culture going forward, how do we deliver the entire organization to our clients, and really get focused on how our clients experience the firm, as opposed to how do we approach our clients, and we've been trying to really wrestle with ways to make that as positive and experience for our clients so they can get what they need out of the firm as possible. And that's really the true north of the organization at this point.

David Novak 23:47

You know, as a relatively new CEO, you've already built a reputation for being strategic and long term focused. And, you know, I always know that people I worked with Goldman talked about Goldman Sachs being long term greedy. Yeah. And here you are, you're you're running this public company where you got to deliver the quarterly results. can you really be long term greedy and run a such a transactional business where the stock goes up and down? And how do you deal with that? Well, I

David Solomon 24:11

mean, I'd start by the fact that no, that's a, you know, a very famous longtime Goldman Sachs expression, but I I'd say, I don't like that expression. Okay. You know, there's a connotation to it, that I, you know, I think I'd use different words in describing how I, I want as the CEO or organization to face clients, I want our organization to take a long term approach to solving our client's needs. And I'm convinced that if you take a long term approach, and you build trust, good things will happen. And we'll do just fine, you know, in those relationships, and that to me, I think centers it, you know, the right way. In terms of the company in the organization, we're making a bunch of investments and I do think this is a change. The organization does have to to perform as a public company, make longer term investments, and those longer term investments have a drag On our short term performance, and we're trying to be very transparent about that. But I think you've got to invest in the franchise. And when I look back at this company, historically, I look at some of the great businesses we've built. Over the last 3040 years, we built an asset management business. But it took us really 15 years to gain traction, we built a merchant bank and investing platforms, but it took 1020 years to really build scale. We're building a transaction banking platform, I'm trying to think about it, how can we make these strong businesses over the next decade or two? And look, there's invariably going to be some pressure from investors and the market in the short term. But as long as we're striking the balance, right, and can show paths to delivering higher returns for our shareholders, I think the market will be accepting of our investments and the overall strengthening of the organization.

David Novak 25:49

I may have the number wrong, but I know you have about 40,000 employees or around that you don't you have such a wide net, how do you make sure that you drive home the importance of values and ethics and the industry that you have to have that as job one?

David Solomon 26:03

Yeah. And so we have 36 37,000 employees spread around the world, we're in 45 countries. And that's, that is a core constant cultural focus of the firm. How do you make in different cultures and different places in the world, the core cultural pillars of the organization? How do you make Goldman Sachs feel like Goldman Sachs as you get around the world, and actually one of the things I take pride in as I travel around the world and see it firsthand, is it feels like Goldman Sachs, those core foundational pillars are there. But I think you have to work hard at it. And I think it's got to be something that you wake up every day, and you think about and you get the organization focused on and look at our business, this is one of the challenges of our business, 37,000 employees, bad behavior by one dense our reputation. And unfortunately, that happens from time to time. And so, you know, we spend a lot of time on training, on compliance, on really talking about why integrity is so important in building trust, and in everything we do. And that doesn't mean that the organization is perfect. And it gets it right every time. And of course, whenever you have an organization of this size, there are people that do things that they shouldn't do. But you've got to be very, very firm, about how you deal with that. And you know, where you stand on what's right and what's not, you know, your industry,

David Novak 27:21

David, as you well know better than most it's, it's so competitive. And you've got you compete against big, massive companies like JP Morgan Chase, and then, you know, small investment boutiques, how do you see differentiating your company going forward?

David Solomon 27:35

Well, in our core businesses, investment banking, sales and trading, and active asset management, these are businesses where there can be niche players that operate in some way. But to really have big businesses in those areas, you have to be a market leader, you have to be global, you have to be broad, you have to be deep. And we happen to be those things in those businesses. And so interestingly, if people technology and capital, capital is a commodity, but the people are differentiating, both in terms of what they do in the technology they can develop in the organization. And so there's a virtuous ecosystem, when you're global, and you're at scale on these businesses, that actually strengthens your position. And we feel very lucky in those businesses to be in that position. That doesn't mean we take it for granted at all. And that doesn't mean we're constantly investing to to strengthen it. But one of our advantages is We're true global firm, and we can bring that to our clients. And we have the resources to, you know, to do that. I do think that the quality of our people, and having an ecosystem with respect to the people in the organization, where our clients really do believe that they're differentiated, is something that's hugely important. And so we invest an awful lot in perpetuating that and making sure that that continues. And one of the things I take great pride in, as I travel around is listening to clients. Tell me about how they value our people. And I also appreciate when they tell me where they don't think it's up to the standard that they expect from Goldman Sachs. And that's very important feedback. Third, I do think that we're good at building platforms and using technology to disrupt or change the way products or services are connected with or delivered to our clients. And I'm excited about some of what we're doing as we start to expand what we can do for consumers. And I think the digital platforms that we're building are quite interesting. I don't think we get a lot of credit for it right now. But that's just fine. But I feel very good about what we're building, and how it's differentiated versus some of the offerings that are out there. And so I'm excited about that, for sure.

David Novak 29:47

Now, when you look at the world, David, what countries and opportunities are you most excited about?

David Solomon 29:52

Well, I'm still very excited about the United States and you know, for good or for bad and there's a lot going on, you know, around the world. You know, one of the things that I know Notice as I get around the world, is there are a lot of people around the world that want to get capital into the United States or want to get into the United States. And, you know, that's a real advantage for us. And something we need to protect. And our model is not perfect here, there are certainly things we can do to improve it, there's certainly things we need to do to continue to improve the opportunity set for everyone across the country. But I'm a big believer in our system and the opportunities that are here. And so Goldman Sachs, while a global firm is a US company, and just very committed to the opportunities to serve our clients, you know, here in the US, that said, you know, we're very correlated to the big economies in the world. So we're very correlated to the broad European economy. Next, which is obviously a very, very significant economy. And we're investing in uncorrelated to China, although obviously, the relationship between the US and China is more complicated. And I think they're going to be bumps in that over the next decade. But, you know, you know very well from yums experience, you know, the opportunity set to build big businesses in China, especially if the business that you're in is really open financial services is really not open yet. But I think over time, it will become more open. And so we're trying to position ourselves for that

David Novak 31:10

day, you're probably wondering when I was going to ask you this question, because I know you get it from everybody. But you know, I've learned that you're not only a big time CEO, but you're a world renowned DJ, you know, tell us how you got into that? Well, you knew I had to ask you,

David Solomon 31:24

yeah, world world renowned would be a stretch. I am a competent house music DJ, who because he happens to be a CEO probably gets more visibility than he deserved. I've always been into music. And about 10 years ago, because I happened to be looking at what was going on in Las Vegas and how the business model was changing in these large hotels, because we were doing some banking work around that. You could see how big a business This was becoming this performance music business, you know, and whether it's in hotels or clubs, and I started asking questions of people in the music industry. And I started learning about some of the music and I actually found, I liked the music. I mean, I've, I've loved all kinds of music. And I've been very into music and live music for a long time. But I really liked this music. And so I got introduced to some people, I got introduced to a pretty world renowned DJ named Paul Oakenfold. He's been around for a long time, it was very involved in in the early days of house music and electronic music and club music. And he suggested to me that he would help me learn to DJ introduce me to some other people. And I started doing it in my dining room on weekends for fun. And about five, five years ago, Paul was coming to New York to perform. And he said to me, Hey, you know, you're getting pretty good. Why don't you come play for an hour in a real life club club called mark key on the Upper West Side of Manhattan? And I said to Paul, I've never DJ in front of anybody other than my family, or the dining room chairs. You know, can I really do this, and he said, Come on, go do it, it'll be early, there won't be a lot of people there. And I showed up, and I did it, I really enjoyed it. So I started doing it as a little bit of a hobby, quietly, just for fun. And then, you know, as my job gave me more visibility a few years ago, I got outed. And then I had to decide, okay, I'm either going to invest some time and do it at a higher level, or I'm going to give it up and I decided to try to do it. When I do get paid, the money goes to charity, I started producing some music, the revenues from the streaming that all goes to charity, I've created a record label called payback records, and payback records, I'm ultimately going to try to get some other artists on it. But the goal is to produce the music and have the proceeds of that go to addiction charities around the United States. And so that's good. If I have the opportunity to do this at a slightly higher level than I deserve because of my business position, I'm going to try to do some good with it.

David Novak 33:45

That's great. You know, I mean, this is a very high compliment, you're not cut from the same cloth, as as a lot of CEOs that I know, you know, you really are authentic. And I can see how in your world it's a 24/7 world that you could be criticized for being a DJ, but you've stuck to it. How do you deal with your authenticity and staying true to who you really are and what you believe?

David Solomon 34:09

Well, I think you've got to when you become a public figure in the context of running one of these companies, I think you have to decide, you know, who you are and what you stand for and what you want to be and I've decided that I'm going to be me, I don't think if you walked around the halls of Goldman Sachs, anyone inside Goldman Sachs would ever criticize my work ethic, my focus my intensity, around helping Goldman Sachs with our great team here, move forward. But I still have a life I'm still human being and I put on my pants one leg at a time, just like you do. And then maybe you jump into the boat, but at my age and your age, you know, one leg at a time. And you know, I have things that I enjoy and and you know I'm at a different stage of life because my kids are grown. So when I'm not working, I have my own time. I don't have to be so focused on my kids and family and so I have time Do these things. There are a lot of CEOs that play golf, and I do play a little bit of golf. But there are a lot of Sundays when my friends are playing golf, and instead of spending, you know, six hours to go play golf, I'll spend six hours in a music studio. And I get as much pleasure out of that, candidly, more pleasure out about the playing golf given the quality of my game. But um, but I still, you know, it's, um, you know, you've got to find things to clear your head. And I find this to be something that relaxes me and clears my head and makes me more effective. And I've also your authenticity point, it's something people can relate to people love music, everybody loves music. And I love the fact that I walk around Goldman Sachs and people who work here, want to talk to me about music, they want to talk to me about Goldman Sachs too, but in some way, shape or form, you know, I hope it just makes every one of the organization recognize I'm just like them, I just happen to have a different job.

David Novak 35:58

We'll be back with the rest of my conversation with David Solomon in just a moment. You know, this tension between long term results and short term results is something every leader faces, and I love Dave, Cody's take on it. He was the CEO of Honeywell for 16 years. And he led it an incredible turnaround. And he believes you don't have to choose between long term and short term results. This conversation might be just the paradigm shift that you need.

Dave Cote 36:26

You don't have to tell your boss or your investor, hey, wait for three years, and then everything's going to be terrific. Rather, there are things you can be doing that allow you to perform better in the short term so that your boss and investor are satisfied. But also does all the seed planting that's needed for the long term.

David Novak 36:45

Go back and listen to my entire conversation with Dave Cody, Episode 20 here on how leaders lead.

David, this has been so much fun, and I want to have some more with my lightning round of q&a. What's one word that others would use to describe you?

David Solomon 37:08

Resilient?

David Novak 37:10

What would you say is the one word that best describes you?

David Solomon 37:13

Persistent.

David Novak 37:15

If you could be one person beside yourself for a day, who would it be and why?

David Solomon 37:19

I mean, I've always had a fantasy to play basketball for the New York Knicks. So you know, put the, you know, put me in the shoes of a great basketball player. I'd love to be a professional basketball player for a day.

David Novak 37:29

What's your biggest pet peeve?

David Solomon 37:31

I like transparency. I like direct engagement. I like honest debate. At times, you know, people don't really want to tell you how they feel I you know, I just wish people would would tell you you know, candidly nicely how they feel and that people would be open to discussion to debate even a difficult topics.

David Novak 37:51

Describe your last I can't believe this is happening me moment.

David Solomon 37:55

I mean, my my last really I can't believe this is happening to be moment is when my daughter told me recently she was getting married. I really I just can't believe I can't believe I'm at a point where my kids are getting married. I also can't believe that I turned 61. Last week, David. So it's all in the route of how did this How did this happen that I got to this point?

David Novak 38:17

What would I hear if I turned on the radio in your car?

David Solomon 38:20

You would hear probably Sirius Sirius bpm? Station 51. Or you might hear seven days on seven. So both ends of the spectrum.

David Novak 38:31

What's something about you, David, that few people would know?

David Solomon 38:36

I'm a kite surfer.

David Novak 38:39

That's fantastic. Okay, that's the end of the lightning round. I'll get it a few questions here. David, you've been CEO now for four and a half years, is there anything about being in that seat that surprised us, you know, something that you really didn't expect?

David Solomon 38:54

I think David, the, the thing that's really interesting about being a CEO, and really sitting in one of these seats, and I know you, you appreciate this, you did this. As a banker, I always would talk to CEOs, and they talk about sometimes the loneliness, the isolation, the fact that that, you know, a whole bunch of a communication in some way gets cut off to you as you sit in those seats. And what you're trying to do is you're trying to constantly open up channels, to, you know, to get people talking to get the information, you've got to work very, very hard at it. And I always would listen to other CEOs, and kind of imagine how they felt and what that meant in terms of kind of the loneliness, or the separation. But you really can't, I was really surprised when I actually got into the seat, how real it is, and how you know how different it is. And you can imagine it but until you really sit there and feel it. It's it's just a very, very different experience. And so I think one of the one of the great challenges for leaders is you've got to figure out how to do everything you can to change or, or modify that dynamic that generally just occurs As you sit in one of these CEO jobs,

David Novak 40:02

you know, anytime a leader comes into a new role, they always make changes. And when you look back on your tenure as CEO, what's that? What's the change that you've made that you're most proud of?

David Solomon 40:14

I think the thing that I'm most proud of in my tenure that relates specifically to Goldman Sachs is the firm has always been a firm with a real strong client orientation. But there were parts of our businesses where there were opportunities to really enhance the client experience. And because we were enhancing the client experience, get a better result for ourselves as a business with our clients. You know, the place where this has been most evident over the last few years is that our, our markets business, our fixed equities businesses are trading businesses. And we've really enhanced the client experience. Not that it wasn't, it wasn't good before, but we've really enhanced it. And that's led to over 300 basis point improvement in market share in a very large, mature business for the farmer, it's really grown the business and strengthen the business. And I think it's, as a result, strengthen the overall performance for the firm. And that was something that that I think wasn't obvious, more broadly, that we made a very, very particular strategic objective. And I think we've really executed on it, it's made a difference. And, and I'm quite proud of the team and the way they've delivered on that,

David Novak 41:17

you know, what would you say David is the biggest change you've, you've tried to make that that met with the most resistance,

David Solomon 41:24

the changes we've made in the organization that have been toughest, have been organizational alignments. So our business was organized a certain way, four and a half years ago. And we decided that we wanted to reorganize the business and the operating divisions of the business. And we've actually made two realignments during the four and a half years, and we now have the business at a place where I think it's really aligned the way we run the business, but those were big changes. And those obviously had an impact on, you know, different leadership groups and who was leading and how the business was, was set up. And those were, those were tough changes to execute on, I think the biggest one is we had a number of asset management businesses in the firm, and a big wealth business. And we really thought that as an integrated platform, as one big client franchise, as an asset Wealth Management franchise, we'd be much more effective in serving our clients. And we'd have a much better ability to deliver, you know, for our clients, and pulling those different businesses together into one big broad business platform. Now, the fifth largest activated asset manager in the world was was a big change. And it wasn't easy, and there were bumps along the way. But I think people really now see the benefit. And I think we have a business that we can grow meaningfully improve the margins meaningfully over the course of the next few years. And I think it's set up very well. But those were, those were some difficult changes, because you're taking, you know, businesses that people ran, combining them. There are obviously winners and losers and corporate parlance in that and, and that stuff's never easy. But I think it was certainly worth the effort here. Because I think it positions the firm and a much better way to serve our clients.

David Novak 43:06

You know, it's always gratifying when you make those big changes, and you begin to see the fruits of fruits of your labor. And another thing that I know, as a CEO you're focused on is the culture and enhancing improving the culture, which is obviously at Goldman Sachs, it was already good. But as you think about a David Solomon behavior that you really wanted to drive into the organization, is there one that you're really trying to put on, put a personal stamp on in terms of the culture?

David Solomon 43:35

I think, David, the culture of Goldman Sachs has been a great asset to the firm, the fact that we retained, you know, a partnership culture, after going public, when most other, you know, partnerships that were in, in the financial services, business, you know, kind of dissolve that ethos has been a huge asset to us. And I really think that the most important cultural thing that I've tried to do, and there are a number of cultural things we're very focused on, but it's really strengthening this partnership culture inside a big public company. And so really investing and making sure as the firm has gotten bigger, that the partnership is special, that the quality of the people, the excellence of the people in that partnership continues in the same way it has for generations at Goldman Sachs, that the aspiration to be a part of that partnership continues, you know, in the same way, and it's not really a personal stamp of me, it's really more a stewardship, stewardship of, you know, this, this very valuable aspect of Goldman Sachs that I think really differentiates the firm, and I'm trying to do everything I can to be the best steward I possibly can be of that piece of the culture that they think is so, so very important.

David Novak 44:43

You know, I'm curious, David, you know, what do you see ahead in the economy the next few years, and how do you think leaders should be preparing for it? With this in mind?

David Solomon 44:52

You know, David, it's an uncertain environment. And I think you really to kind of frame the forward from here. I think you've got to think a little bit about the journey we've been on. And how did we get here? You know, coming out of the financial crisis, we went through a decade of very, very easy monetary policy, even as economic conditions normalized. After the financial crisis, there never really was the move from central banks around the world to kind of normalize monetary policy. And we were just starting to do that when we had a real out of the box, Black Swan event, the pandemic, and not so much that the pandemic, there have been pandemics before there'll be pandemics again, but the thing that happened with this pandemic, that was really different is we shut down the economic engine of the world, all over the world. And we kept it shut down for an extended period of time, and that created real imbalances in the world. And the way we compensated for that that closure of economic activity was with massive fiscal spendings fiscal stimulus to try to counterbalance, you know, some of the impacts of that, that broad shutdown. And so the result of that was a real imbalance in the economy that we're now trying to rebalance. It's not surprising that that led to inflation start to creep into the economy. And then in early 2022, we had another out of the box event, with ground war in Europe, which obviously had enormous secondary applications to energy supplies, given policy decisions that have been made across the European continent. And so the combination of all this, along with increased geopolitical sensitivities around the world, starting obviously, with the US China bilateral relationship has really shifted the economic climate. And we're now resetting in a meaningful way. And so I think it's still uncertain how we navigate this, I would say the consensus view at the moment is becoming, you know, a little bit more dovish, that we can have a softer landing, if you and I were speaking last summer, I probably would have said to you that the chance of recession in the United States is very high, almost certainly in Europe. And now, you know, if you look at our economists, our economists do not see a recession in the US, although I'd tell you, I still think there's a real possibility of one and a much lower chance of one in Europe. And so, you know, there's, there's a scenario, we can have a softer landing, but we're tightening economic conditions very quickly, we have to rebalance, you know, the labor force. And generally, when that happens, you have a slowdown in economic growth. And so I think we have bumpier economic growth ahead. It's obviously kind of deflated asset prices, and I think we're gonna have a tougher time with asset appreciation ahead. To finance things is going to have a real cost to it. Again, we haven't seen that in quite some time. And so I think you've got to expect, even though uncertainty exactly how it plays out in 2023, I think you've got to expect slower growth, less asset appreciation, kind of a tougher, you know, a tougher economic slog for a period of time here. And even though we might navigate through, you know, 2023, in a softer way than people might have expected six months ago, you know, I do think, you know, in the next couple of years, it's not going to be back to the races of what we've kind of seen, you know, over the last 15 years, in terms of, you know, markets and asset appreciation. And so, you know, all of those are slight headwinds to growth. So I'm cautious. I'm generally a glass half full guy, I think we can navigate through this, we will get through it. I think the geopolitical sensitivities are higher. And those are also headwinds to growth. But I think we just have to be a little bit more cautious. So as leaders are running big businesses, you can plan for, you know, a more dovish scenario. But I think you've got to be prepared in the way you operate your business, for the outcome, that we have some tougher economic times ahead of us in the next couple of years. And I think most CEOs are doing just that. They're being a little bit more cautious, and a little bit more thoughtful, given the way they look at that economic picture. But I will say, you know, the US economy, the European economy, they're proving to be relatively resilient, you know, even in the light of a very quickly changing, you know, economic environment.

David Novak 49:07

You know, David, I know you spend a lot of time with small businesses, and you hosted a, I think around 10,000 small businesses in your New York headquarters in December. What specific advice do you have for people, you know, running these smaller businesses today?

David Solomon 49:22

So small businesses is such an important part of the engine of growth in the US economy. You know, as you know, and you highlighted it, we run a big program called 10,000 small businesses that provides business education for small businesses. And over the last 15 years, I think we've had 13 or 14,000 businesses, you know, across the US go through it, and keep a really good set of metrics on how they grow, how they hire, how they expand coming out of it. And, you know, the best advice for small businesses is to try you know, try to take a long term view toward you know, building your business, make sure you understand the business and economic model, you know, Have the business and the business can really drive a margin or an economic model. A lot of people start businesses, because they have a good idea. But they haven't really thought through how the economics of the business work. So make sure you really understand the economics of the business and the economics of the business can support your plan, and try to plan try to get help try to find mentors, people that have experience that can help you broaden your experience. Most entrepreneurs have small businesses have have certain skills, but they don't necessarily have the broad range of skills that are necessary as businesses scale, whether it's finance and planning skills, budgeting skills, you know, think about how you can find ways to get mentors that can help you with those things. And really, really make sure you understand, you know, the base economic model and the face economic model works, and then pour your heart and soul into it because running a small business is not easy. Other things, it takes an enormous commitment and an enormous and an enormous amount of passion. You know,

David Novak 50:57

I know you attend the World Economic Forum in Davos, what's what's a big insight that you've walked away from, from that experience?

David Solomon 51:07

I just came back from, you know, from WEF last week. And, you know, I'd say the, the biggest thing that I get out of it each year, is it gives me an opportunity in a very condensed period of time, to share views with lots of business leaders and government officials. And so I would say in a two and a half day period of time, you know, I had over 30 bilateral meetings, we hosted two dinners that had over 60 kind of government leaders or CEOs present. And in the context of that, it's a great opportunity to listen, learn and compare notes and try to get a sense of how people feel. So you know, my biggest takeaway is always kind of a gauge on how people feel at that moment. And, you know, I would say that sometimes there's a correlation to how people feel, and how the economic scenario plays out in the year. Sometimes it turns out not to be correlated. But it's helpful to understand that because if you can understand how people feel, and you start to think about the inputs that are driving that sentiment, it sometimes can get give you better insight into, you know, economic activity broadly. And so I really use it as a way to both connect with people and keep those connections, you know, real. And I think when you sit down with people in person, you know that that strengthens the, you know, the connection, the bond you have, but also to walk away with kind of a sentiment view, which helps me a little bit, because it's in January, kind of think about the year and think about the direction of travel for the year. You know, as

David Novak 52:31

we close, I'd love to have you leave us with a story that that highlights what's possible. If you enjoy the ride, whether in your career, or in your life. I mean, you're a grinder, you're a competitor, you know, you know, the ever What do you do to just enjoy what's happening? Is that something to even take time to think about? I do think about

David Solomon 52:54

it, David? And it's a great question. And I appreciate your asking. And I mean, I first and foremost, I've, you know, two beautiful daughters, and a wonderful, wonderful family and lots of great friends in the world. And those things have always been important to me through my journey and coming out of school and building my career. And they, they always will be the number one priority. But I love my job, I love the business, I've always loved the business, I never really envisioned that I'd wind up in the seat, I think I I wound up in the seat through a convergence of, of hard work over a long period of time, and an awful lot of luck, you know, luck being you know, being more important to because I think, you know, timing and serendipity play a lot in the way these things play out. But, you know, I've enjoyed the people I've met, I've enjoyed the intellectual stimulation. And, you know, I try on a day to day basis, to really, you know, relish the parts of the job and the parts of the experience that I love, which is really the interaction with people, the strategic thought process, and really, you know, debating and thinking about the strategic agenda and then trying to execute on it. And, you know, I try when it's more difficult than it can be, as you know, difficult from time to time, the tough quarters, some of the visibility that comes with it, you know, I tried to you know, to segregate those things and put them aside and just realize that, you know, the job is to wake up every day to do the best that you can do, to be true to who you are. And, you know, if you do those things, you know, you're probably going to do just fine. And, and, you know, embrace people listen to people bring in different points of view, and try to do everything you can to just keep moving forward.

David Novak 54:37

What would be the one piece of advice you'd give to anyone who wants to improve as a leader?

David Solomon 54:45

Leaders grow and evolve. There's not one leadership style and everybody's leadership style has to grow and evolve, but I think all of us as leaders have to be very self reflective, and be willing to listen to that. not just the good stuff that comes in, but the critical stuff too. And you've got to be able to not be overly sensitive to criticism and try to constantly figure out how can I evolve as a human being? How can I grow? You know, how can I expand my capacity, and then you also have to be willing to make difficult decisions and understand when you make difficult decisions, you know, they're not always going to be popular. And, you know, leadership is about taking people where they don't want to go. If you're, if you're taking them to a place where they're going on their own, they don't really need your leadership. And when you when you have to make difficult leadership decisions, they're going to be times when people doubt, and people, people criticize, and you have to be willing to, you know, listen to that, and absorb it and make sure you're doing the right thing. But you also have to stay true to your convictions and not let the noise, you know, take you off course, you know, I try every day to listen. But I also try every day to have a lot of conviction about, you know, the things that we want to do and, you know, try to move forward slowly and steadily. But it's not, it's not a straight line. And it's certainly, you know, it's a marathon, not a sprint, David, as you will know, you know,

David Novak 56:06

David, every time I get the opportunity to talk to you, it strikes me from the conversation that we have, how modern your thinking is, and how focused you are, and in taking Goldman Sachs and in the future, and you've got this great historic company. But I love your focus on on being really contemporary and pushing the envelope with new thinking and, and I really appreciate you taking the time to share your thoughts and insights with the CIO. So thank you very much, David, appreciate it.

Honestly, I mean, how many people have what it takes to be both the top CEO and a great DJ. I mean, that's a pretty extraordinary overlap of skills. But hey, David is a pretty extraordinary guy. And he dropped some serious wisdom on us today, including how important it is for leaders to take a longer perspective. I know, we all face short term pressures. It takes a lot of courage to bring long term thinking to the table. But it's key to sustainability and success, especially when it comes to earning the trust of your customers and building a strong company culture. So let me ask you, what's one practical way that you can take a longer view? Consider this in your regular check ins with your team? What percentage of your time do you spend talking about the immediate day to day stuff? And how much of the meeting Do you devote to discussing big long term goals and challenges? It's your job as a leader to facilitate long term thinking. And that's a simple way you can get your team to look past the short term pressures and see what's in the distance. So do you want to know how leaders lead? What we learned today is the great leaders take the long view. Coming up next on how leaders lead is Oscar Munoz former CEO of United Airlines,

Oscar Munoz 58:01

we can get caught up in ourselves our intellect, our strategic mindset, our education and learning how to present things logically and and attack the mind and trying to solve issues. We also learn over time that the path to true engagement and true real release of someone's discretionary effort is not only capturing the mind, but the heart as well.

David Novak 58:24

So be sure to come back again next week to hear our entire conversation. Thanks again for tuning in to another episode of how leaders lead where every Thursday you get to listen in while I interview some of the very best leaders in the world. I make it a point to give you something simple on each episode that you can apply to your business so that you will become the best leader you can be

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