Philipp Freise, co-head of European private equity and partner at KKR, has done his time in the industry and worked his share of long hours.
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When Freise, a graduate of Germany’s WHU – Otto Beisheim School of Management, joined KKR in 2001, the firm had fewer than 100 employees in London, and they were expected to work hard. “I don’t think we left KKR before midnight for the first 10 years,” Freise reminisced to Financial News. “We all had to work 24/7. Those were the old days of private equity. It was just about surviving.”
Times have changed. Just as rival firm Apollo has been softening its culture, so has KKR. Freise and Mattia Caprioli, KKR’s other co-head of European private equity, say there’s no longer an emphasis on face time. – People at KKR’s London office aren’t expected to be in at 8am and to leave at midnight, as when the two partners were themselves young. “Having everybody in the office until midnight in August means you have a cultural problem,” Caprioli declares.
It’s an edict that’s come from the very top. Joseph Bae and Scott Nuttall, KKR’s co-chief executives sent employees an email last week urging everyone there to work a bit less in August. Freise says people need time to recover. “This is a creative job,” he tells FN. “If people are exhausted, they can’t be creative. Bursts of intensity need to be followed by recovery.”
Freise is embodying this ethos. As the father of four children, he says he’s careful about his working hours: “I have four kids and during the week I don’t work from 6.30pm to 8.30am. Everybody here knows that. That’s created a culture.” KKR wants its employees to have families, Freise adds: there are no meetings at 8am so that its people can do the school run. Promotions are based on treating young people well: “You could be the best dealmaker but if the feedback is that you burn people to the ground, you won’t be a partner….”
Separately, Goldman Sachs used to be all about growing talent in-house. Carsten Woehrn is a notable exception.
Woehrn did not rise up through the ranks of Goldman Sachs, but through the ranks of JPMorgan, where he spent 24 years after joining as an analyst in 2000. Goldman poached him in April, and now Financial News reports that Goldman is appointing Woehrn co-head of EMEA M&A with Nimesh Khiroya, who’s been there 20 years.
Woehrn is also joining Goldman as a partner. It’s all part of Goldman’s attempt to seduce financial sponsor clients like Freise at KKR in Europe. The two men have their German nationality in common. It’s not clear whether Woehrn stops work at 6.30pm too.
Meanwhile…
Josh Harris, co-founder of Apollo, says sports changed his life. “I was a college wrestler. If I hadn’t gone through the experience of having to go out there and literally be physically dominated by another human being, I probably wouldn’t have worked as hard as I did in my youth.” (Bloomberg)
Late last year, Preqin estimated the amount of “dry powder” at over $4tn, almost a third of the entire private capital industry’s total assets under management. Morgan Stanley analysts reckon the pile of proverbial dry powder has now grown to about $4.5tn. (Alphaville)
Deutsche Bank is encouraging its investment bankers to be more selective in pitching for mergers and acquisitions mandates and focus on more profitable deals. Deutsche Bank is seeking to win more mandates on deals that are worth at least $500 million and could bring in at least $3 million in fees, some of the people said. For buyside advisory roles involving a private equity firm, rainmakers are focusing on deals worth more than $1 billion. (Yahoo)
Deutsche Bank is focused on Asia, where its headcount rose 16.6% last year to 27,095. “We invested significantly and against the industry trend. Last year we were one of the only banks that really focused on strong origination and advisory businesses globally and in Asia-Pacific. And it’s paying off.” (SCMP)
Under ex-CEO Noel Quinn, HSBC tried to cut employees by about 15 per cent to 200,000 within three years. As of December, though, that figure still stood at 221,000. (Financial Times)
London-based hedge fund Ilex, led by Jonas Diedrich and Dave Sutton, the London-based firm is in talks with clients to open the fund to an additional $1.5 billion. (Bloomberg)
ESG is not what it was. BlackRock has started four new ESG funds this year, compared with 36 in 2022 and 23 last year. DWS is down to three this year from 25 in 2023. Invesco has launched just one ESG fund so far in 2024, compared with 12 in 2023. UBS has introduced six sustainable funds this year, down from 16 last year and 26 in 2022. (Bloomberg)
In 2022, ESG roles were growing 22%. This year, they’re growing 5%. (Bloomberg)
Hedge funds are all about hiring power traders. (Bloomberg)
Brevan Howard’s crypto fund is up 20% this year after a rise of 44% last year. (Financial News)
Citi hired Michael Phipps from Truist as s head of building-products investment banking. (Bloomberg)
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