Goldman Sachs Group Inc. (GS) CEO David M. Solomon is facing criticism from some of his partners and shareholders over his side gig as a DJ and his recent acquisition of GreenSky, a fintech company that provides point-of-sale loans.
Solomon’s DJing Hobby Raises Eyebrows
Solomon, who goes by the stage name DJ D-Sol, has been performing at various venues and events, including the Super Bowl weekend in Miami, the Electric Daisy Carnival in Las Vegas, and the Safe & Sound concert series in the Hamptons. He has also released several songs on streaming platforms, such as Spotify and Apple Music.
While Solomon has said that he enjoys DJing as a way to connect with people and express his creativity, some of his colleagues and investors are not impressed by his hobby. According to a report by The Wall Street Journal, John Rogers, Goldman’s secretary to the board and a longtime partner, told Solomon that his DJing was not the right image for a top Wall Street CEO. Rogers also suggested that Solomon should tone down his social media presence, where he often posts photos and videos of his performances.
Additionally, Lloyd Blankfein, the former CEO of Goldman Sachs who retired in 2018, has reportedly told other partners that Solomon needs to focus more on his day job and less on his hobbies. Blankfein has also complained about Solomon’s decision to merge some of the firm’s businesses and reduce the number of partners.
Solomon’s GreenSky Deal Draws Scrutiny
Solomon’s DJing is not the only thing that has caused discontent among his partners and shareholders. His recent acquisition of GreenSky, a fintech company that provides point-of-sale loans for home improvement projects, medical bills, and other expenses, has also raised questions about his strategy and judgment.
Goldman Sachs announced in September 2021 that it would buy GreenSky for $2.24 billion in an all-stock deal. The deal was part of Solomon’s plan to expand Goldman’s consumer banking business, which includes its online platform Marcus and its credit card partnership with Apple.
However, soon after the deal was announced, GreenSky revealed that it was facing a lawsuit from the Consumer Financial Protection Bureau (CFPB), which accused the company of enabling merchants to take out loans on behalf of consumers without their consent or knowledge. The CFPB also alleged that GreenSky failed to resolve consumer complaints and provide adequate customer service.
The lawsuit has resulted in a significant drop in GreenSky’s stock price, which has reduced the value of the deal for Goldman Sachs by about $500 million. Some analysts have also questioned the logic of the deal, given that GreenSky operates in a highly competitive and low-margin market. Moreover, some of Goldman’s partners have expressed concerns that the deal would expose the firm to more regulatory scrutiny and reputational risk.
Solomon Defends His Leadership and Vision
Despite the backlash from some of his partners and shareholders, Solomon has defended his leadership and vision for Goldman Sachs. He has said that he is committed to transforming the firm into a more diversified and digitalized financial institution that can serve a broader range of clients and generate more stable revenues.
Solomon has also said that he is proud of his DJing hobby and that he does not see it as a distraction from his work. He has argued that he is able to balance his professional and personal interests and that he does not let his DJing interfere with his responsibilities as CEO.
Solomon has also said that he is confident in the long-term potential of the GreenSky deal and that he believes it will enhance Goldman’s consumer banking business. He has said that he is aware of the challenges and risks involved in the deal and that he is working closely with GreenSky’s management to resolve them.
Solomon has also said that he values the feedback from his partners and shareholders and that he is open to constructive criticism. He has said that he respects the opinions of his predecessors, such as Blankfein, but that he also has his own vision for the firm.
