Stories

For a businessperson involved in the mining sector, attending a Mines and Money conference is like going on pilgrimage to the Vatican, Mecca, Jerusalem or Varanasi.

The journey begins with a longing desire to see and experience something sacred and holy. Next, preparations are made for the journey. Suits are packed, along with presentations and plenty of business cards. Upon arrival, the pilgrim joins a large group of devotees and listens to the voices of the enlightened few.

The believers are bound by a shared set of beliefs. At Mines and Money, those beliefs can be summed up into one sentence: “What lies beneath the ground holds untold riches.”

Mines and Money

In a nutshell, the event brings together mining companies, investors, brokers and other third parties so that they all share information, exchange ideas and – hopefully – do business.

I decided to attend the December 2013 conference in London. The event took place in the fashionable Islington district.

For one, a friend and former client had a stand there. His was one of the gold mining companies present. I wanted to catch up with him and his team on the progress of the company. Secondly, some of the most prominent figures in the business were in attendance and it was a good opportunity to discuss current trends in global mining. Amongst other things, it had been a challenging time for the sector as a whole. Many businesses had difficulty accessing capital.

On the 2nd day of the conference, whilst taking a little break, I accidentally bumped into an acquaintance of mine by a coffee table. This older gentleman, almost twice my age, happened to be one of the shareholders of the group that owns the Mines and Money conference brand. We had a brief chat and agreed to meet up the following day and go for lunch as it had been a while since we last saw one another.

Day 3

The next day when I arrived at the pre-agreed meeting point I found my friend holding two sandwiches in his hand.

Odd. Aren’t we going out?

“Come, no time to eat out. Let’s go listen to the speakers,” he said.

Not interested. The last thing I wanted to do was to listen to more speakers. I had listened to a few already and preferred to mingle with the people on the floor who manned the stands. They included geologists, CFOs, business development executives and even CEOs. “Look, I’m not so keen on listening to more speakers. Why don’t we meet up afterwards?”

“Don’t be ridiculous. The most successful mining entrepreneur of our time is speaking. You want to listen to him.”

Interesting. I reconsidered.

“And he’s a born entertainer.”

Done. “Let’s go.”

We set off in the direction of the large designated room where the speakers took turns to pontificate. My friend manoeuvred his way to the front row, asked a random stranger to move down one seat and the two of us ended up sitting next to one another. We ate our sandwiches and listened to the talk.

And then, finally, the speaker I was persuaded to listen to came on stage. Let’s call him Mr. Mining (or Mr. M). [READ MORE…]

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Of Religion And Banking

It is said that Paris Berkeley Capital’s private banking business owns a highly secured and closely monitored chateau in an undisclosed location in Normandy, France where four floors below ground level there is a candle-lit corridor that leads to a stone spiral staircase which in turn takes you further down to a large rectangular hall guarded round-the-clock by Swiss-trained security officers.

Inside this mysterious hall – know as the ‘library’ – rests a large collection of archives which collectively tell the history of investment banking, dating back to antiquity. It is even said that some of the oldest investment banking deal agreements are held within this highly secure room. They outline, in great detail, various monumental transactions ranging from the financing of the great pyramids of Egypt to the exploits of some of the most famous explorers of our past, including Hernán Cortés.

In one section of the library there is long shelf labeled ‘religion’. The remarkable thing about it is that on that very shelf is a scroll which proves that it was in fact investment banking which helped catalyse the beginning of what later became known as the monotheistic religions.

The scroll is titled The Persian and The Shepherd.

The Persian

Story has it that thousands of years ago a young, handsome Persian man of humble origins set out on a journey across the world to discover the secret to great wealth. He, above all else, desired vast riches.

Driven by a deep-seated desire to find the truth, he spent fifteen years travelling from place to place taking odd jobs wherever he could. Everywhere he went, including as far out as India and Egypt, he carefully observed the habits and idiosyncrasies of the very rich and successful. His goal was to glean as much possible from them in order to discover what was responsible for these individuals’ vast successes. He would then do the same and hopefully become a very rich man himself one day. His was a quest filled with purpose.

To his frustration, however, the Persian could not pinpoint one key, defining characteristic that accounted for all the money very rich people made. The myriad of wealthy merchants and businessmen he met differed from one another greatly. The great South Indian spice trader whose floors the Persian cleaned was a completely different man from the Arabian gold collector whose shoes he shined and the Chinese silk merchant whose harem he taught Farsi (Persian).

Alas, the Persian was no closer to understanding the secret of success than when he set out on his mission fifteen years ago.

That is, until he met the wise Shepherd of Bagdad. [READ MORE…]

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A Coffeeshop BankerSome of us may have had the pleasure, or displeasure, of knowing people like Tom. A bullshitter of epic proportions whom everyone knows is a bullshitter, yet who carries on bullshitting without respite because with the passing of time his bullshitting knowhow has evolved and overtaken his capacity to tell fact from fiction.

By way of background Tom was an Egyptian lad who was raised in the US. I met him years ago in Washington DC, before he became an alleged investment banker. What I recall most from that first encounter was thinking to myself: “My God, this guy is an extreme exaggerator.” What I didn’t give him enough credit for at the time, however, was his creative capacity. Only now, looking back, can I admit that he infused high levels of creative genius in his stories.

The way his brain fabricated these tales should be the subject of a National Geographic feature on the intricate workings of the human brain.

Everybody knows a Tom

In practically every group you’ll find someone like Tom. The usual suspects generally exaggerate anywhere between 25-30% away from the truth. Outliers like Tom, however, will occasionally hit 100%+. For instance, someone will ask him how many women he’s been with and, without hesitation, he’ll double where he thinks others in the group would fall. So not only does he fabricate rapidly but he gauges his surrounding, constantly adapting output in accordance to input.

His are stories we love listening to even when we know they’re unfounded. If he accidentally bumps into a cute girl at the bar, excuses himself, walks away and reaches the group and someone asks him what just happened, he’ll reply something to the effect: “oh, she asked me if I was alone but her breath was kicking like Van Damme so I had to escape.” A kiss on the cheek in the real world would translate into wild sex in his matrix.

Initially, Tom used to tell everyone he was Italian. Even though his surname was as Middle Eastern as shawarmas. He figured it would yield better returns with the American girls. As we got to know him better and learned that his only link to Italy was a 1-week family trip to Rome when he was eight, he skilfully preempted any attempt to question him on his nationality and dismissed the whole Italian topic as a joke.

Fast forward some years and we’re both in London working in financial services… [READ MORE…]

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Near-Banker-Death Experience

Let’s be honest here, the greatest joy in banking is a huge bonus. But money alone won’t bring happiness. Honours and titles also matter. One of the greatest honours which can be bestowed upon an ibanker is a standing ovation.

Standing ovations usually happen for one of two reasons: a massive deal is closed and the bank makes an extraordinary amount of revenues; someone collapses or faints from exhaustion and / or excessive stress during a deal. The latter is what we call a near-banker-death experience.

An example of the first scenario was when we extracted over USD50m in fees on one deal alone from a massive Middle East client. The head of Investment Banking practically moonwalked over to our desk and shook everyone’s hands. This sort of event is the more common of the two. The second scenario is what leaves the strongest impression on all bankers as it touches on human limits. I’ll never forget the first time I witnessed it. I was less than one month into the job.

The victim was Thomas, an Associate from Denmark. He joined the bank the same time I did. The poor guy was unfortunate from the very first day on the job because the head of his team was responsible for several geographies and given they were short-staffed Thomas was assigned as the ‘extra help’ for multiple geographies. In short, he was screwed at hello. Thomas sat one row away from me.

On one of those very busy days when he was juggling a handful of billion dollar projects while getting yelled at by everyone, in person and over the phone, having to read and reply to a couple of hundred e-mails and warding off incessant requests for his help, he suddenly collapsed… [READ MORE…]

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The ibanker and the blogger in India

Once upon a time there lived a diligent, thirty year old investment banker who was known to do little other than work. He divided his time working between London and New York. More than handsomely rewarded by the investment bank for his contributions, he was never short of money and had a penchant for luxurious living. In fact, he demanded the very best of all things. The finest French wine, Savile Row tailored suits and watches only the very best Swiss watchmakers could concoct. It was commonplace to believe that he was living the life.

The investment banker was in Mumbai on business.

It’s Friday night and, having spent the last three days working from before sunrise until well past sunset, he decides to abandon the luxurious Taj Mahal Palace hotel and go out for a drink. The polished concierge enthusiastically recommends a well-known Mumbai institution only steps away from the hotel called Leopold Cafe. “The restaurant serves delectable dishes and popular drinks and is frequented by writers, artists, travellers, business people and even Bollywood actors,” says the concierge ending the statement with a magical head bobble. Wearing his Navy Blue jacket, khakis and burgundy loafers, the investment banker sets out to enjoy a drink or two and unwind a bit.

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There is a branch of psychology which studies human behaviour in the workplace. It is called Industrial and Organisational Psychology. In the aftermath of the 2008 financial crisis a handful of psychologists from that field were handpicked by a consortium of bulge-bracket investment banks to fulfil an important mission: to create the Comprehensive Banker Fitness (CBF) programme.

Like many radical ideas within the world of finance, the CBF was born in a luxury hotel in the presence of a beautiful woman. The setting was the Dorchester Hotel on Park Lane in Mayfair. A landmark in its own right, it is owned by the Brunei Investment Agency and has served for some time now as a meeting spot for the rich, famous and criminal. From the opening of private bank accounts by dodgy nominee middlemen representing prominent African politicians and up-and-coming A-list actors sharing beds for the night with casting agents, directors and / or producers to high-level discussions surrounding the Qatar Investment Authority’s next trophy acquisition, the Dorchester is where centres of power meet. Each year executives from the world’s leading investment banks secretly gather there for their annual ‘collaboration for survival’ meeting. The point of these meetings is to share experiences and exchange ideas on how to keep staff motivated and hungry. Remember, pyramids can only be built on the back, sweat and blood of slaves.

The year CBF was born was a rather tumultuous period which saw record-level firings and job losses in the finance sector. Overall negative sentiment in the market, coupled with the rising possibility that bonuses would fall far below previous years, led many bankers to question their career. According to several independent surveys, talk of leaving the industry was rife and at its highest in years. Naturally, executives were scared. Very scared.

The annual meetings took place in one of the Dorchester suites the execs stayed in. The whole affair generally lasted two days. The first day was more of an open discussion around challenges each of the banks faced while the second day was used to identify practical solutions. Despite an eight-hour-long meeting on Day 1 the discussions were not fruitful, to say the least. As soon as they called it a day one of the execs, Roger, known to be one the highest earners in the business, took out his phone and reached out to Madame Shireen, London’s most exclusive procurer. He needed a distraction.

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My MD is demi-god

“Holy shit! He is un-be-liev-able.  He flipped through each slide in under three seconds and caught all the mistakes right away. It took him two minutes. Shit that would take all four of us an hour he did it in two minutes. Like in the movie A Beautiful mind. A-ma-zing!”

It was Vivek’s first month as an analyst and he was still susceptible to bouts of frenzied hysteria. I didn’t take my eyes off the computer screen. I had no interest in the silly conversation which ensued between him and his buddies. Where neophytes were present some variation of that story theme would regularly surface. I’d heard it too many times before.

‘Presentation scrutiny worship’ towards senior bankers was common among young new joiners. I’d go so far as to say that it was akin to a parent-child relationship. Vivek was like a little boy who saw daddy as the greatest in the whole wide world. So long as father banker did something little Vivek couldn’t, the former drew great admiration. Even when daddy used his toes to pick up a pencil from the floor, it was…magical and awe-inspiring.

I admit it. Picking up a pencil from the floor is incomparable to refining a pitchbook. None the less, a master-servant relationship dynamic is at work here.

My personal view on ‘presentation scrutiny worship’ was ambivalent. On the one hand, you’d think that only a single-cell organism would rejoice at someone’s ability to detect font size discrepancies between headings on two consecutive presentation slides. On the other hand, the obsessive level of attention to detail coupled with the unforgiving demand for consistency applied to presentations led way to the creation of quite simply very effective documents. It simply worked. I’ll be honest with you. This particular skill became invaluable to me, especially when I later launched my first company. It enabled me to make a mere startup, comprised of only a few guys, appear like a mid-sized company with global operations. Hey, you just can’t ask for a £15,000/month retainer for 9 months if you’re a few guys working out of a tiny shared office space.

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In late 2007 the Kenyan government proudly announced the imminent debut of its sovereign bond issue. Naturally, a proud day for Kenya. (Pause). An ill omen for me.  I was part of the team which went on to pitch for the deal.

For many emerging market bond issues, the process of raising capital via what’s called the Debt Capital Markets (DCM) generally begins with the receipt of a Request For Proposal (RFP).   The potential issuer (i.e. emerging market entity) will send out an RFP to a select number of investment banks inviting them to participate in the deal by completing a series of questions contained within the RFP.  In essence an RFP is an invitation to obtain an invitation.

I used to tell people that working on emerging market bond issues, be it in from the Middle East or sub-Saharan Africa, was tantamount to showcasing a questionable bikini model to big modelling agencies.  Let me elaborate. My client, the emerging markets issuer, was ‘potentially’ a bombshell – that’s what I would tell all the agencies.  In reality, she was at the time far from stunning.  Sure, you could take her out but it was best to go somewhere with poor lighting and few VIPs, if you catch my drift. However, what I’d always emphasize was that she was growing sexier by the day (high growth rate!). That’s what made her so unique and so different from all the others. What’s more, she was exotic and, for much less than the ‘other’ girls, had more tricks to light up the catwalk with.  Yet agencies tend to be very cautious.  And they were scared of the danger my ‘alternative’ beauty could unleash.  To be fair, some of these models have been known to suddenly erupt into all sorts of nasty behavior, let completely loose on the catwalk, scream wildly and leap onto onlookers.  Between you and I, that is what I have always loved about a so-called emerging market issuer: its unpredictability.  How could anyone ever get excited about a boring Scottish water company, dull power plant in Virginia?

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Looking back into the past often conjures up feelings of surprise. Surprise at how quickly time passes, surprise at opportunities missed, surprise at fears which never materialised and surprise at the crusader expressions which have become a part of our lives.  Take ‘The Axis of Evil’. We’ve all heard that expression. A close friend of mine who happens to be an investment banker in Mumbai once swore to me that the expression, as we know it in the political sense, in fact originates from India. “It all started with a graduate student at the Indian Institute of Technology (IIT), in Bombay, my friend,” he said.

India, the cradle of so many things…

Story has it that a young engineering student, Benoy, had written a thesis arguing the inherent shortcomings of three celebrated mathematical models. The paper, or diatribe rather, was titled ‘The Axis of Evil’. One day, while on a flight over to the U.S. to interview for a fellowship at Harvard’s Mathematics Department he was bumped up to first class due to an overbooking and was seated next to President George W. Bush’s speechwriter, David Frum.

When the plane hit cruising altitude Benoy took out his thesis to do some revision and started scribbling some notes. A couple of hours later he is fast asleep and an involuntary arm movement pushes his paper onto the floor. The fall catches the speechwriter’s attention who, in turn, reaches down to pick up the paper but pauses as the title catches his full attention. Seconds later David places the paper beside Benoy.

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Despite having a strong aversion for grunt work, Marius was an agreeable fellow to work with.  He was fair-skinned, tall and verging on lanky.  Also, unlike most of us in sub Director-level positions, he was already married and had a young child.

Marius had just joined the team a month ago and was the most junior member within our Managing Director’s bitch slap’s reach.  His hair was brushed the same exact way at all times and he always carried a can of San Pellegrino Orange sparkling drink.  Always!  Even if empty he’d carry a can with him or leave it on the table for everyone to know it was his signature beverage.  Every time he spoke of taking a holiday or wishing to be somewhere warm and sunny there was always a can of San Pellegrino Orange in the picture.  ”I can’t wait to go to Marbella in the summer, lie on the beach, read a nice book and sip on a fresh can of San Pellegrino….”.  It was more than just a drink.  It was a way life.  It meant…correction, was suppose give others the impression that…you were the type of person who went on holiday in the Amalfi Coast and knew the owner of the best clifftop pizzeria around.

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