Morning Coffee: Anthropic is making bank CEOs look overpaid. Hedge funds have to decide who’s really a partner

Although the big AI IPO deals appear to be on a slower track than anticipated, the teams at Goldman Sachs and Morgan Stanley are still working hard.  They have now reached the point of preparing a draft S-1 prospectus for Anthropic, a copy of which has fallen into the hands of the Wall Street Journal.  While the source of the document is not clear, and it might be a few rounds of “pls fix” from completion, there’s a lot of interesting stuff in there.

💥Follow us on WhatsApp for news alerts.💥

There’s the astonishing revenue success of Claude, for example, and the equally jaw-dropping ongoing financing plans.  There are the “risk factors” section, where someone appears to have taken the opportunity to write a dystopian science fiction novel taking up a third of the filing. But even more interestingly, there are details on the compensation of the CEO and President, Dario and Daniela Amodei.

And it turns out that their pay is … pretty good, but not outlandish.  For the most recent year, they both got a base salary of $655k. Dario’s total compensation including stock options and awards was $18m and his sister was on $16.5m.

Which means that they would be doing well compared to European bankers.  Only one unnamed Material Risk Taker at Deutsche Bank got between €17m and €18m last year; as far as we can tell this was the best-paid banker or trader in Europe, and quite a bit more than Deutsche’s CEO Christian Sewing (€10.5m).  The Amodeis were also paid more than Andrea Orcel of Unicredit (€13m) and only a bit less than Ana Botin of Santander (€18.5m) got for her role as executive chair.

Once you leave the euro area, though, the comparisons change.  Sergio Ermotti of UBS, was rewarded with the equivalent of $19m last year, and Venkat made $20m at Barclays.  And then we get on to the Americans.

David Solomon at Goldman Sachs led the bulge bracket, with total compensation of $47m for 2025.  That was just ahead of Ted Pick at Morgan Stanley, who was awarded $45m.  Jamie Dimon was on $43m, Jane Fraser on $42m and Brian Moynihan on $41m. Outside the bulge bracket, Rich Handler of Jefferies got $28m and John Weinberg of Evercore got $17.1m.  And if you think that’s a lot of money, consider that Blackstone paid Jon Gray more than $300m and Steve Schwarzmann $1.2bn (although these aren’t quite comparable as they include carried interest and dividends).

This isn’t necessarily to say that investment banking CEOs are paid too much, or that AI frontier lab founders aren’t paid enough.  We suspect that the Amodeis will do all right in the long term.  But it is slightly amusing, given everything that’s been said about the existential risk of AGI, that managing the risk of total human extinction pays almost exactly half as well as managing the risk of a bulge bracket balance sheet.

Elsewhere, the title “partner” has been no more resistant to the industry’s appetite for grade inflation than “Director” or “Managing Director”.  Law and professional services firms, as well as hedge funds, tend to proliferate titles like “senior income partner”, “salaried partner” and the like.  The rule of thumb is that the more adjectives there are in the title, the further you are from actually being a partner.

Up until recently, one benefit to doing so, in London at least, was that partners, unlike employees, don’t pay National Insurance (the UK’s equivalent to Social Security contributions).  However, after Bluecrest lost a case against the tax authorities last year, the rules relating to this loophole have been clarified. Basically, sharing in the profits of the partnership isn’t good enough – you have to be someone who has “genuine influence” over the direction of its business.

This is obviously more difficult to establish the larger the firm is.  So it seems that some law firms, consultancies and hedge funds are going to need to remove people from the partnership and turn them back into employees.  In most cases, they will still keep their profit shares, and are likely to “remain a partner for external purposes”.  But even so, it’s going to be pretty painful to be given the brutal truth.

Meanwhile …

The inside story of the power struggle at Macquarie Capital that saw Tom Butcher leave last week as Michael Milne and John Farnik were promoted.  Apparently there were “disputes over credit for transactions, senior figures intervening in mandates” and a perception that the “old guard” would “cause problems” for anyone who got in their way.  (AFR)

David Sambur and Antoine Munfakh of Apollo have written an open letter to junior investment bankers (“Prospective Apollo Associate Candidates, Class of 2028”) telling them that Apollo will only be recruiting them after a year’s experience, rather than immediately on starting their Wall Street jobs.  They are cancelling “on-cycle recruiting” for a second year and expressing hope that the rest of the private equity industry will do the same thing. (Business Insider)

“It’s little things like that I have seen over time … it makes me grouchy and undermines my confidence about whether the GPs really have our interests at heart”.  Monte Tarbox, CIO of the New York City pension fund system, was not pleased when a private equity firm tried to ask him to pay for private jet flights. (FT)

Despite tough conditions for hedge fund launches, people still want exposure to technology trends. Jeff Wang (formerly of Sequoia) has a track record rather than a really convincing blog post, so his Augnition Global Investors fund has been one of the few to raise more than $1bn this year. (Bloomberg)

“Scion” sounds so much more dignified than “nepo”.  Profiles of Evercore’s John Weinberg and Perella Weinberg’s Peter Weinberg, grandsons of iconic former Goldman Sachs leader Sidney. (FT)

The European Central Bank has annual elections to its staff council.  One central banker decided that it would be a good idea to run an absolutely bizarre campaign, based on the 2012 comedy film “The Dictator”.  It was apparently intended to satirise restrictions on candidates’ publicity material; he has been reprimanded. (Financial News)

Follow me on X. Follow me on LinkedIn. 

Have a confidential story, tip, or comment you’d like to share? Contact: +44 7537 182250 (SMS, Whatsapp or voicemail). Telegram: @SarahButcher. Signal: sarahbutcher.22  Click here to fill in our anonymous form, or email editortips@efinancialcareers.com. 

Bear with us if you leave a comment at the bottom of this article: comments are moderated intermittently by human beings. Sometimes these humans might be asleep, or away from their desks, so it may take a while for your comment to appear. You must take sole responsibility for comments you post on this site. We will take reasonable steps to weed out anything that we consider to be offensive or inappropriate.