Sunday 25 March 2018

The Punt: Blackstone's big salaries

Brian Caulfield
Brian Caulfield Newsdesk Newsdesk

It's a rite of passage every year. Big bank puts out its results, the press works out the average pay per employee in the firm and the headlines write themselves.

They usually read something like "average pay at [fictional] MegaGiantBank is 20 times the average industrial wage".

The target is usually our favourite vampire squid, Goldman Sachs.

Sure enough, there were a rash of stories this week about how Goldie pays its workers an average of $288,000 per annum.

Decent money as that is, the Punt thought that seemed a little low for the Masters of the Universe.

And so it has proved.

Since the financial crisis, many of the star traders and deal makers have decamped from the big investment banks and moved to private equity and hedge funds.

These companies generally make big, big money, but have fewer staff to share it with.

It's no surprise then that when we looked at Blackstone's results last week, it became very clear that this is where the real money is located.

Average compensation per employee works out at $656,000.

Of course, that doesn't mean if you started at Blackstone tomorrow you would immediately be on $656k.

Most of the money goes to the top ranks after all. But if you wanted evidence of where the power is in the financial world, here it is.

It looks like Blackstone is happy enough with all the property deals it has done here in recent years.

Thinking outside the box

If you have the drive to set up a successful business, you deserve some credit - particularly if you think outside the box, to use the cliche. And so, kudos to the man in Massachusetts who decided to capitalise on the US state's famous autumn colours, to make a quick buck, by selling and shipping leaves.

The Bostonian is offering to ship bundles of the dried up, multi-coloured vegetation straight to your door for $19.99. Kyle Waring set up the website earlier this year and began sending his first packages of hand-picked leaves to US customers this month.

"I've hit over 200 sales so far," he said earlier in the month. Perhaps he could come to our rainy shores and start bottling water. Nah. Who would be silly enough here to buy bottled water?

TCD start-ups beat the odds

Trinity College Dublin had a big win last week: it made it to the top of PitchBook's list of the highest-ranked university in Europe for producing undergraduates who go on to found companies receiving venture capitalist backing.

Between the years of 2010 and 2015 - the period over which PitchBook conducted its independent analysis - Trinity produced 114 such entrepreneurs, 106 companies, and raised capital of approximately $655m (€575m). To put Trinity's achievements into context, second-placed Oxford University produced 72 entrepreneurs.

Even more impressive is the fact that Trinity's graduates have done this in an environment that rewards entrepreneurship far less than competitor countries like the UK.

One of the university's most successful graduates is venture capitalist Brian Caulfield a partner at Draper Espirit and head of the Irish Venture Capital Association.

He graduated with a computer engineering degree in 1986 and stayed on to do post-graduate research.

Caulfield has just slammed the Government for failing to support entrepreneurs in the latest budget.

Irish entrepreneurs are at a huge disadvantage in comparison to their UK counterparts, he said: "This is a budget that takes a very small step towards tax equalisation for the widest possible group of entrepreneurs and the self-employed.

"It does next to nothing to improve the environment for start-ups or to address our huge competitive disadvantage relative to the UK."

Irish Independent

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