Investment Banking - Goldman Sachs 2020 Investor Day

Leadership and Strategic Vision

• Greg Lemkau and Dan Dees are co-heads of the Investment Banking Division, having joined in the same 1992 analyst class with 28 years of tenure at the firm.
• The division explicitly defines its position as the "number one investment bank in the world," rooted in its status as the primary "trusted advisor of choice" for global clients.
• Growth strategy is built on three vectors: increasing market share in core services, expanding client footprint (specifically the $500M–$2B cap segment), and launching transaction banking solutions.

Market Position and Performance Data

• Investment banking revenues exceeded all competitors over the past five years.
• The firm maintains a #1 or #2 market share in M&A and equity underwriting across every industry sector.
• M&A market share reached 35% of announced volume in 2019, representing 20 of the top 25 transactions (80% share).
• Over the last decade, the firm holds a 39% premium in advisory revenues over the next-highest bank, earning over $7 billion more in fees annually.
• Equity underwriting saw #1 rankings in 2019 volumes and in each of the past 10 years; the firm is the only one to rank #1 or #2 in Americas, EMEA, and Asia for the past five years.
• Debt underwriting achieved a "step function" growth from #5–#11 in 2011 to a leading position in investment-grade acquisition finance today.
• Since 2015, the firm has committed nearly $200 billion in 38 transactions for investment-grade acquisition finance.

Client Base and Financial Sponsor Growth

• The firm covers over 10,000 clients globally across 40 offices with over 3,000 bankers.
• Financial sponsor (Private Equity) M&A volume increased from 13% in 2009 to 25% in 2019.
• The firm ranks #1 for financial sponsors in announced M&A, equity underwriting, and high-yield bond issuance.
• Current sponsor coverage includes over 600 clients managing 6,700 portfolio companies valued at over $2 trillion, supported by over $1 trillion in industry dry powder.
• Private equity relationships provide recurring revenue streams; a single portfolio company (Nordic Distribution) generated 7 distinct banking engagements over 15 years.

People, Culture, and Talent Strategy

• The 2019 analyst class comprised over 28,000 applicants for fewer than 500 positions, with over 50% female representation.
• Strategic lateral hiring is used to fill gaps; seven senior partners were hired in 2017, including David Solomon (returned in 1999) and specialized leaders in China and sovereign wealth.
• The firm emphasizes an apprenticeship culture where senior teams, who worked on nearly all major deals of the past two decades, mentor junior bankers.

Innovation and Product Development

• Equity IPOs: Led the direct listings for Spotify and Slack; introduced innovations including accelerated share repurchases and pre-IPO capital raises.
• Diversity Mandates: Effective July 1, 2020, the firm will only underwrite US and European IPOs with at least one diverse board member; this requirement rises to two in 2021.
• Transaction Banking: A new "high-tech, low-touch" platform is in pilot with a US addressable market of $80 billion.
  • Forward-looking goal: Achieve 1% global market share within five years to generate $1 billion in annual revenue and $50 billion in deposits.
  • The platform features real-time insights, modern infrastructure, and a consumer-grade user interface.

Execution Case Studies

• Fiat Chrysler-Peugeot Merger: The largest cross-border transaction of 2019 required resources across seven offices in three continents to mirror the client's tri-hub headquarters (Detroit, London, Turin).
• Spotify Relationship: A 10-year partnership began in 2010, evolving from early capital investment and advisory to a landmark direct listing in 2018, generating significant wealth management cross-selling.

2020-2025 Strategic Objectives

• M&A: Maintain #1 market share in volumes and revenue.
• Equity Underwriting: Solidify #1 rankings in deal count and revenue.
• Debt Underwriting: Maintain top-4 global position, punching well above the firm's lending footprint.
• Coverage Expansion: Increase coverage of public companies between $500 million and $2 billion; currently at 44% coverage, with a goal to add 1,700 new companies to the universe (raising total coverage to over 11,000).
• Transaction Banking: Deliver the platform globally in Q2 2020 to diversify revenue and improve pre-tax margins.