More WeWork drama, Wall Street's technology power players, Here are the top cannabis bankers
Hi readers,
How the mighty have fallen! WeWork, whose CEO Adam Neumann claimed he was going to be the first-ever trillionaire (and live forever), is now private jetless and walking shoeless around NYC's Gramercy neighborhood.
In just a whirlwind couple of weeks, $47 billion WeWork - once one of the world's most valuable startups - pulled its IPO after reports that its valuation could fall as low as $10 billion, lost the backing of its biggest investor SoftBank, and saw the ousting of at least 20 members of Neumann's inner circle. Neumann himself was removed as CEO after investors blamed him for the company's profitability woes and questioned his personal behavior and self-dealing.
(Side note: If you are having trouble keeping up with the latest news in this incredibly fast-moving story, I don't blame you. BI has assembled an easy-to-follow timeline of all the highlights).
There's a bunch of potential fallout from the WeWork saga that will be interesting to watch:
- Is the IPO window now shut for money-losing startups? WeWork's shelved IPO wasn't the only letdown from a buzzy consumer company this year. Fitness company Peloton saw its public debut this week fall flat, following disappointing IPOs from Uber and Lyft. Entertainment company Endeavor also pulled its IPO this week. What does this mean for other hot startups that planned to go public like Airbnb or Postmates later this year or early next?
- Future of SoftBank's Vision Fund. The $100 billion Vision Fund, which has poured money into TikTok parent ByteDance, ride-hailing firm Uber, and office-sharing firm WeWork,is now facing questions from critics about how sustainable it is to flood fast-growing companies with hundreds of millions of dollars. Two of the biggest investors in SoftBank's original Vision Fund are debating whether to significantly cut back on their commitments to a planned second one, Bloomberg reported. The investors' debates over their commitments to the second Vision Fund come as the original fund is reportedly down $600 million on its stake in Uber and as it prepares for a big drop in the value of its WeWork investment.
- Impact on the New York City real estate market. WeWork has become a dominant player in the office market in many major cities. In New York and London, WeWork is the largest private sector office tenant. What would it mean for the city's commercial real estate market if WeWork were to go away?
- Ripple effects on the co-working model. The introduction of coworking companies like to major urban office markets could bring new risks when the next economic downturn strikes, Eric Rosengren, the Boston Federal Reserve president, said earlier this month. Coworking businesses "are creating a new type of potential financial-stability risk" and could bring massive commercial real-estate losses in a recession, Rosengren said, without naming WeWork specifically.
Readers, what else should we be writing about? Drop me a line any time at ooran@businessinsider.com to let me know.
Olivia
We identified the 20 most powerful people in Bank of America's equities division. Here's our exclusive org chart.
Business Insider is mapping out the power structure in the global banking and markets businesses overseen by Bank of America Merrill Lynch Chief Operating Officer Tom Montag - one of the most powerful executives on Wall Street.
Of the three major investment-banking groups, equities is the smallest, accounting for 26% of the $18.7 billion in revenue earned across global banking and markets last year.
It's also more shrouded in mystery. Unlike the fixed-income trading group, the stock-trading unit has one primary power broker: Fabrizio Gallo, who is one of the longest-tenured division heads in Montag's world.
Along with Gallo, our equities organizational chart for Bank of America Merrill Lynch features more than 20 of the division's highest-ranking sales and trading executives.
Citadel just cut a team managing more than $1 billion after an analyst and a data scientist broke internal compliance rules about trading in personal accounts
Analyst Josh Lingsch and data scientist Derek Allums were fired by Citadel after they broke one of the firm's rules for trading in personal accounts, sources tell Business Insider.
They were a part of a nine-person team in Texas that was focused on energy investments.
The portfolio manager of the team, Jarrad Bourger, was fired because of performance reasons unrelated to the compliance issue, a source close to the firm said.
The team managed more than $1 billion, and the portfolio was liquidated after Lingsch and Allums were dismissed.
POWER PLAYERS: Meet the 8 executives leading the most innovative tech projects on Wall Street
Business Insider compiled a list of the people leading the most innovative and ambitious tech projects at Wall Street's biggest firms.
We asked Wall Street players and industry insiders who was spearheading the most cutting-edge tech initiatives.
The list includes eight people who are heading up teams or projects at a range of the largest banks, hedge funds, asset managers, and exchanges.
IEX's CEO Brad Katsuyama discusses failing to stand up a listings business, if he regrets being as vocal as he has, and what's next for the 'Flash Boys' exchange
IEX, the startup exchange that was featured in Michael Lewis' 2014 book "Flash Boys", exited the business of listing companies on Monday.
The exchange was able to get only one company, Interactive Brokers, to switch to it.
IEX, which was founded in 2012 and gained regulatory approval to operate as an exchange in 2016, has struggled to gain significant market share, holding just shy of 3% in August.
Brad Katsuyama, IEX's CEO and cofounder, spoke to Business Insider about the decision to walk away from listings, what went wrong, and the state of the exchange overall.
WorldQuant's Igor Tulchinsky just guaranteed his team 75% of last year's performance bonus to soothe nerves as quant funds get slammed
WorldQuant's Igor Tulchinsky has promised his team that they will receive 75% of their performance bonusfrom last year in a company-wide communication recently, Business Insider has learned.
A source close to the firm said the goal was to limit distractions for the team as they went into the fourth quarter of the year.
Quants generally have had a tough year, with many getting hit hard by the collapse in momentum stocks earlier this month.
Here are the top bankers raising money, putting together deals, and raking in millions in the global cannabis industry
Cannabis companies have been going public, merging, and acquiring competitors in a race for a competitive edge as cannabis legalization continues to sweep the globe.
According to a report from the cannabis accounting and advisory firm MGOEllo, there were 300 strategic acquisitions worth $8.4 billion in the cannabis space in 2018, up from just $54 million in 2013. All that jockeying within the industry has led to a boom for investment bankers, who help companies raise money, go public, and pursue M&A.
Here's our list of the top bankers working on cannabis deals.
Wall Street move of the week:
Goldman Sachs lost another partner as CEO David Solomon continues a cull of its high-ranking execs
In markets:
- 'It's going to 30,000': A CIO who oversees $4.9 billion explains why the Dow is headed for fresh record highs - and shares his top 4 stock picks for the upswing
- 'Invest in what's scarce': Famed economist David Rosenberg explains how the average trader can supercharge returns in a tumultuous market
In tech news:
- SoFi's CEO Anthony Noto says WeWork is a 'gut check' moment for startups eyeing IPOs, and highlights how boards need to change their thinking
- Buzzy insurtechs say AI and big data could soon transform insurance policies. But how the tech treats riskier customers is raising regulatory and ethical questions.
- Emerging markets, M&A, and new services: here are the key trends to watch in the fast-changing payments space
- Adam Neumann is out as WeWork's CEO, but that's no 'silver bullet': VCs and proptech experts think it will take cutting passion projects and cleaning house to right the ship
Other good stories from around the newsroom:
- 'It puts us into a different class of media companies': Vox Media talks up the benefits of its New York magazine acquisition, including new advertisers and a $10 million-plus e-commerce business
- We asked Uber Freight head Lior Ron everything about the tech giant's push into trucking - from profitability to matching algorithms to tackling the trucker shortage. Here's the full interview.
- People are hacking their Peloton bikes so they can watch Netflix and cheat the leaderboard ranking system