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Lazard Makes Diversity Bet With ‘Salomon Sisters’ Stake

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·4 min read
Lazard Makes Diversity Bet With ‘Salomon Sisters’ Stake
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(Bloomberg) -- Independence Point Advisors, the investment-banking startup known by the nickname “Salomon Sisters,” marked its debut as one of Wall Street’s only women-owned firms by forming a partnership with Lazard Ltd.

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Founded by Anne Clarke Wolff, who over three decades held leadership roles at Citigroup Inc., JPMorgan Chase & Co. and Bank of America Corp., Independence Point is pitching itself as the answer to clients’ demands for more diversity among bankers. Based in New York, it has three main businesses: strategic advice including mergers and acquisitions, capital markets, and consulting on risks ranging from cybersecurity to geopolitics.

Lazard acquired a minority stake in Independence Point and will be its exclusive partner on M&A assignments, handling all execution.

“There are many settings where it’s already a huge disadvantage to show up with a team of all-white men,” Peter Orszag, Lazard’s head of financial advisory, said in an interview. “It’s just going to be a requirement for many clients to see diversity, and we want to be prepared for that.”

Most of Wall Street has been slow to adjust. While the typical class of incoming analysts at investment banks is evenly split between men and women, the senior ranks are more homogeneous, and Citigroup’s Jane Fraser remains the only female chief executive officer among New York’s bulge-bracket and boutique firms.

Wolff, 56, who left almost a year ago as BofA’s chairman of global corporate and investment banking, was determined to change the status quo.

“It couldn’t be a better time,” she said Monday on Bloomberg Television. “Clients kept coming back to the diversity of opportunities and challenges that they were confronting and the need to have a wider aperture of talent to navigate that.”

Orszag, together with Lazard CEO Ken Jacobs, saw partnering with Independence Point as a way to help modernize the 173-year-old firm, broaden its talent pool and burnish its recruiting credentials. He called it an “inflection point” in the industry’s history and cited research that shows input from people with a range of gender and racial backgrounds leads to better outcomes in the kinds of complex, non-routine situations that make up the bulk of Lazard’s work.

Network of Women

Wolff also brought a network of women with deep boardroom and industry experience, 15 of whom signed on as senior advisers to bring in deals and buttress her firm’s capabilities.

Lazard and Independence Point are in talks with a half-dozen companies as anchor clients for their suite of combined services and hope to announce them in early 2022. Orszag described them as leaders in their industries and said, “part of the appeal is being recognized as playing a role here.”

Independence Point is building a team of experts to give managements and boards of directors advice in areas such as human capital and ESG. It also is applying to become a registered broker-dealer.

After starting at Salomon Brothers in 1989, Wolff built her career in corporate banking. Most boutique founders over the past 40 years, from Bruce Wasserstein to Peter Weinberg to Ken Moelis, were already star rainmakers at big banks who broke off with a roster of longtime clients and pipeline of future deals.

While that approach has been enormously successful, it tends to be highly dependent on the skills and relationships of founding CEOs and thus vulnerable to bumpy transitions when they decide to retire.

Wolff said she’s deliberately “shying away from the star model” by partnering with one of the leading M&A advisers and sharing resources. For example, she and Orszag have discussed having the next class of summer interns split their time between Independence Point and Lazard. Both firms are located in Manhattan’s Rockefeller Center.

Independence Point currently has a staff of eight, with plans to add three or four more employees in the next 30 days. Wolff’s leadership team includes Terri Lecamp, who founded Plainfield Asset Management and most recently was chief operating officer at Melody Capital Partners; and Siobhan MacDermott, a specialist in cybersecurity and related risks who worked at Ernst & Young, BofA and Tata Consultancy Services.

The firm is holding off on more recruiting until after Wall Street bonuses are paid out over the next couple of months and candidates are ready to move.

“First and foremost, it’s about finding exceptional talent,” Wolff said. “Clients won’t hire us because of diversity alone.”

(Adds comments from Bloomberg Television interview.)

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