Goldman Sachs' next CEO is a part-time electronic dance DJ

Goldman Sachs' next CEO is a part-time DJ
Goldman Sachs' next CEO is a part-time DJ

Goldman Sachs' next leader isn't your typical investment banker.

David Solomon has been named as the successor to CEO Lloyd Blankfein, who is stepping down September 30. Solomon is a part-time electronic dance DJ who spins records around New York and Miami clubs under the nickname DJ D-Sol.

"[I] kind of stumbled into it as a hobby, and now I just do it for fun," Solomon said in a podcast last year. Solomon was interested in club and EDM music and saw them as growing businesses.

He took a winding route to the brink of one of Wall Street's highest-profile jobs.

Related: Goldman Sachs signals who its next CEO will be

Solomon, 56, majored in political science at Hamilton College. One of his first jobs out of school in the mid-1980s was selling commercial paper and junk bonds at Drexel Burnham Lambert -- Michael Milken's firm that went bankrupt in 1990 for its involvement in Milken's criminal junk bonds trading scheme.

After Drexel collapsed, Solomon moved to now-defunct Bear Stearns, where he rose to become head of the firm's investment banking division. In 1999, Solomon took a risk by jumping to Goldman.

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"It was a step back," Solomon told the New York Times last year. "I was running a division of a firm and I went and I took a job running a department."

Solomon came to Goldman right after a moment of palace intrigue. Hank Paulson, then Goldman's co-chairman, had helped stage a coup against fellow co-chair Jon Corzine in 1999, pushing him out of the company. (Corzine was later elected U.S. senator and then governor of New Jersey. Paulson ran Goldman for eight years before leaving to become Treasury secretary under George W. Bush.)

Although Solomon was an outsider at a company known for promoting internally, he climbed up the ranks at Goldman and headed up its investment banking unit for a decade beginning in 2006. The division's sales rose 70% during his run.

When Gary Cohn left Goldman to become President Trump's chief economic adviser last year, Solomon was promoted to president along with Harvey Schwartz. The two were competing internally for the top job until Schwartz resigned in March, clearing the way for Solomon.

Related: Why Wall Street loved Gary Cohn inside the White House

Solomon was the "better choice out of the two," said William Cohan, a financial reporter and author of the 2011 book "Money and Power: How Goldman Sachs Came to Rule the World." "He was more politic [and] gregarious. He was more statesmanlike."

Solomon has given money to candidates from both parties. During the 2016 campaign, he donated to both Hillary Clinton and Jeb Bush's campaigns, according to contribution database OpenSecrets.

Solomon will take over a bank that has recovered under Blankfein since the financial crisis a decade ago. But he'll still face challenges.

Blankfein was Goldman's former trading chief and the bank has relied heavily on client fees from its trading desk -- buying and selling bonds, commodities and currencies. The unit made up more than half of revenue in 2012, but it shrunk to a little over a third last year. The combination of market calm, low interest rates and tighter financial regulations have pushed investors to shift money into low-fee index and passive funds, hurting Goldman in the process.

Related: Goldman Sachs is Wall Street's big loser

Goldman unveiled a $5 billion revenue growth plan last year, which included expanding its online consumer lending business and bolstering ties with corporate clients. Solomon was more aligned with those initiatives than Schwartz, KBW analyst Brian Kleinhanzl noted.

"The challenge and opportunity is for Goldman to better leverage the strong CEO relationships cultivated and maintained by David Solomon," Wells Fargo analyst Mike Mayo said.

Solomon thinks the market will swing back in Goldman's favor, too.

"Some of this is a cycle that in a different environment with higher volatility, higher rates, you'll see a shift back where active managers can find ways to add value," he said last September.

This story has been updated from its original version. It was first published on March 14, 2018.

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