GOLDMAN CEO: The opportunities for young people are better today
Long-time Goldman Sachs (GS) CEO used to be “scared to death” when presenting to senior leaders at the firm in his younger years. That’s one reason why he particularly impressed with a group of millennial-aged analysts who pitched him and the partnership committee.
“I can’t remember a moment where I wasn’t scared to death doing it and I’m thinking to myself, ‘boy, who are these people?'” he told Yahoo Finance.
Tuesday’s event was the firm’s third-annual Analyst Impact Fund, a contest where analysts from around the world compete for the chance to win up to $150,000 for non-profits in their communities. The fund is part of Goldman Sachs Gives, which is a donor-advised fund where managing directors at the firm recommend grants for non-profits. Since its inception in 2010, the fund has given more than $1.3 billion in grants to more than 6,000 organizations. The firm recently opened up what’s historically been an outlet for the most senior leaders to analysts who’ve been with the firm for at least one year.
This year’s field began with 66 teams of analysts, with a range of charities, from technology that would improve medical devices for infants suffering from respiratory distress to providing access to technology that would help diagnose tuberculosis.
This year’s first-prize was awarded to a London-based team who pitched on behalf of Bondh-E-Shams, a non-profit that enables access to safe water via solar energy.
While there were many impressive ideas submitted, Blankfein explained that Goldman is thoughtful about where it allocates its philanthropic dollars.
“These are real dollars that are beings spent, and we’d like every dollar to have an impact of ten dollars, not every dollar have an impact of ten cents. And so, we’re kind of ruthless in requiring things that are proven, that will work, where we think that we’ll get a lot of leverage for our investment. Just like in our core commercial activities, we want to see the same thing out of our philanthropic activities.”
That golden age really wasn’t that golden
Blankfein, 63, joined Goldman Sachs in 1982 through J. Aron & Co., a commodities trading firm, and eventually worked his way up the ranks. He’s held the role of CEO for 12 years. The son of a postal worker who grew up in public housing and put himself through Harvard, Blankfein still sees an opportunity for young people.
“[Everybody] talks back to some golden age which wasn’t that, you know, really wasn’t that golden. In mid-century, really, before there was such an awareness of gender rights, civil rights to the same extent. We’re aware of the problems that we have today, and I don’t want to diminish them, but the opportunities are better than they were, and there’s plenty of opportunity to make them better still.”
He noted that young entrepreneurs today can get their technology cheap and secure office space and financing much more accessible.
“It’s kind of easier for somebody who takes the course that I’ve taken, which is more of an entrepreneurial one, to do that today compared to a generation ago, and certainly for several generations ago. But I don’t want to minimize the fact if you don’t get into the position where you are aware of these opportunities, for example, if you grow up in the lower strata of society, it’s still quite hard. I still think the safety net is higher than it once was. But I’m not going to challenge the notion that, you know, there are issues with equality, and some of those things have worsened over time, but a lot has gotten better too.”
Young people make decision that have an impact
In some ways, Goldman’s competition also speaks to the importance of talent.
“Young people make decisions that have an impact. We pick people to finance and guess what, we pick people that we won’t and projects that we won’t finance. That is a very, very heavy responsibility,” Blankfein said.
He pointed out that the firm is involved in all sorts of industries, ranging from industrial to natural resources to technology.
“People come to us, and they say, ‘will you invest your own money?’ which is an important validation for people. And if we do that, then other people put their money in and things work,” he said, adding,
“We’re kind of, in some ways, the invisible hand you read about in classical economics, where we help money come from the people who have it to the people who need it in order to create their enterprises, and create jobs, and create the kinds of products and services that benefit everybody.”
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Julia La Roche is a finance reporter at Yahoo Finance. Follow her on Twitter.
