Morning Coffee: Regrets of the ex-JPMorgan banker on $30k a month. 25 year-old VCs received a salary reduction

When should you leave your steady banking job, with its steady salary and its wealth of deferred bonuses? It's always a hard decision, particularly if you're a managing director who's worked at one bank for 20 years and your deferred is large.

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Paul Barrett seems to have thought hard before leaving JPMorgan. After the event, Barrett wrote to his new employer and complained: “I walked away from all my JPM stock and now my annual compensation is reduced by 66% until I can sign more clients." Fortunately, he still seems to been in receipt of a $30k monthly management fee.

Barrett's travails are detailed in the Financial Times. Like many bankers, he left the carpeted corridors of the big institution for the thrill of the family office. Unfortunately, the family he chose was the one-man-dynasty of Jeffrey Epstein. 

It was a fatal move. Along with Peter Mandelson, Jes Staley and many others, Barrett's subsequent career implosion is now public knowledge. As Jeffrey's private banker, he suffered all the standard problems of private office persons (can't always get hold of the founder, founder has own opinions about investments, founder loses confidence after a period of poor returns), plus the fact that his name became associated with the world's most notorious deceased sex offender.

It can't have been easy for Barrett, described by ex-colleagues to the FT as "sophisticated, intelligent" and "with a certain air of confidence." Fortunately, though, he was able to take himself off to Citi. After seemingly minimal due diligence, the bank hired Barrett in 2019 and appointed him to head its private capital group's North American region. Barrett left again five years later once Citi apprehended his history. It's not clear whether he got to keep any stock that time instead.

Separately, young people love venture capital firms, but venture capital firms do not love young people.

Three years ago, VC jobs were all the rage with 26 year-olds aspiring to find the next unicorn. Now, a new compensation survey says their pay is shrivelling.

While senior VCs are still handsomely remunerated, newcomer notes that analyst salaries fell 25% last year to $78k and that few analysts in VC firms receive carried interest, even when it is available.

AI is to blame. Large language models are proficient at market mapping, deal sourcing and competitive research and you don't have to pay them much at all.

Meanwhile...

Jeffrey Epstein was coaching Jes Staley on how to object to the Volcker Rule. “We should craft an arg why volcker is bad for europe..Peter can say he has spoken to you. It is bad for europe for the following reasons.” (Financial Times)

Rokos Capital Management had been thinking of hiring Peter Mandelson for an advisory role but has changed its mind. (FT) 

Jain Global hired five new portfolio managers in Asia. (Bloomberg) 

Hudson River hired Lawrence Tan as its new head of business development for Asia. (Bloomberg) 

Goldman Sachs general counsel Kathy Ruemmler appeared to ask Jeffrey Epstein if he planned to “trade one of your Russians for my comp” in an email exchange about her negotiating a potential job at hedge fund Citadel. Ruemmler never worked for Citadel, though. (Financial Times) 

APAC banks want traders. One of Australia’s largest banks, fresh off its best month for trading revenue in nearly a decade, plans to hire in areas including commodities. (Bloomberg) 

Moelis & Company increased pay by 22% last year. (Financial News) 

Sergio Ermotti thinks macro volatility will last 10 years. (Bloomberg) 

Filho is likely to have options for his next seat. Before joining Morgan Stanley, he briefly worked with Dan Friedman at Goldman Sachs. Friedman is the new man to know in Millennium's credit trading business. 

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