At least the founder and chief executive of investment bank Moelis & Co resisted the temptation to wear traditional Middle Eastern clothes as a sign of his commitment to the regime and its ability to dispense enormous fees in the event that an IPO of Saudi Aramco ever takes place.
Ken is a dark suit and tasselled loafers kind of guy and is rarely photographed out of this costume.
The same cannot be said for some other investment bankers who are becoming fetishistic about trying to convince clients that they are kindred spirits, rather than simply highly paid advisers whose public imprimatur will help to ensure that a transaction goes smoothly.
Michael Grimes, head of technology investment banking at Morgan Stanley, is an extreme example of this trend. He was recently reported to have moonlighted as an Uber driver as part of his bid to ensure that Morgan Stanley wins a lead role on an IPO of the firm.
An IPO of Uber could value the firm at well over $100 billion – if the US equity market can avoid an implosion before a potential deal date of early 2019. If a deal goes ahead, it could be comparable in scale to the 2012 Facebook IPO that generated around $175 million in fees for Wall Street banks – led by Morgan Stanley and Grimes.
So the stakes for taking the biggest share of the fee pool for an Uber IPO are certainly high.
Masquerade
It is not clear what Grimes added to his pitch by working as an Uber driver before delivering a deal proposal, however. If anything, his antics highlight the extent to which corporate finance advisory work is a masquerade.
Details that he might have gleaned about how Uber works and the frustrations faced by real drivers are quite likely to have presented the company in a negative light.
If Grimes wins the mandate, he will nevertheless spend the coming months trying to convince investors that everything is rosy for the future of the controversial firm; and that a 25% rise in the nominal value of Uber since a private fundraising a few months ago will be followed by further price appreciation after its shares go public.
For Grimes, it is presumably enough that he can argue – first to Uber’s board as they decide on an IPO mandate, then to investors if he wins the lead slot – that he has a unique insight into the workings of the company and devotion to its future success.
It may be a relief when this is over and Grimes can move on to pretending that another technology firm is his abiding passion.
Airbnb and Palantir are among other tech-based firms that are believed to be considering IPOs, so perhaps Grimes will start renting out space in his house or take up a side line as a spy.
Grimes is in his 50s now, so hopefully he won’t embarrass his friends and family by developing a sudden fascination with pinning photos and recipes in a bid to win a mandate for a possible IPO of Pinterest.
The sad truth about the plight of the ageing technology banker is that he (and it is mainly still ‘he’) is doomed to an increasingly implausible act as someone who is attuned to the changing habits of young consumers.
The money must provide some consolation, but it is no doubt a terrible strain at times, even for an accomplished performer like Grimes.
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