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JENN OCAMPO-KING: I'm Jenn Ocampo-King, and I'm thrilled to be joined today by Jeff Solomon, president TD Cowen, who will be co-hosting this special podcast with me. During this episode, we will be joined by Tom Strauss, vice chair TD Cowen, to discuss his incredible 60-year career on Wall Street, the evolution of the industry, and his philosophy about the importance of partnerships. Tom, can you share your career story and how you got to where you are today?
TOM STRAUSS: Luck, hard work, being in the right place at the right time. I started at Salomon Brothers. I was probably the first trainee. I'm not sure I was actually ever interviewed by more than one or two people. And I wound up sort of in the mailroom, worked my way up into the government bond department, put magnetic numbers on the board so we knew what the quotes were, because the idea of any sort of technology didn't exist.
I got the issues right, so they thought that I could do a bit more than just put numbers up on a board. And then I grew up on the sales side of the business. And in 1979, I looked at myself in the mirror and realized that I was responsible for half the firm's balance sheet.
JEFF SOLOMON: So when you think about the evolution of the business, when you started in the '60s, and it's really seven decades where you've seen a tremendous amount of change. Can you just highlight some of the things that you helped to bring about, change-wise, certainly things like the mortgage market that changed tremendously? Salomon Brothers was at the center of that, the treasury market, and how you've seen that change? Some of the things that, maybe early in your career in the middle of your career, you saw that were evolutionary or revolutionary, that you got in front of.
TOM STRAUSS: I think they fall into three categories. Size-- everything's much, much bigger. Technology-- information flows at a much more rapid rate. And Jeff, as you pointed out, financial innovation-- and Salomon Brothers was at the forefront of financial innovation in the mortgage, mortgage-backed securities business. But financial innovation only works when there's a need for it. And there are a lot of ideas that surface that die quickly because they don't fit in. They don't fall into a need in the capital markets.
High yield was another one. We fought the high yield bond business. And it took us a while to accept the notion that high yield was going to become an integral part of the capital markets.
I think, though, Jeff, as important as what's changed is what hasn't changed. This is a people business. People do business with people they like, they respect, and clearly that are qualified. I think character, integrity, judgment-- Bill Salomon stood for those things when I joined Salomon in 1963, used many of those words on a regular basis. So I think it's important to recognize there are a lot of things that haven't changed.
JENN OCAMPO-KING: And I think we're going to skip to another question because that segues really well into it. Partnerships have been so important to you. Can you share a little bit about the partnerships that you've built over your amazing career?
TOM STRAUSS: I think investment banking is a team sport. If we're to be successful, we have to garner the resources, the best resources we can to tackle every challenge and every assignment. And in order to do that, we have to think of ourselves as one team, one goal. We're going to cross that goal together, or we're going to get trapped in the infamous red zone.
So I am definitely a we person, not an I person. And when I hear people talk about, I did this and I did that, I'm uncomfortable, because people don't do it alone. Success is shared experience. And we should relish those opportunities and talk about how we won as a team, not how I won as an individual.
JEFF SOLOMON: And that's an unusual trait. I mean, again-- so in my 35 years, we've spent the vast majority of my 35-year career together as partners. And you know, I've said over and over again, one of the narratives of my career, Jenn, is that I've been blessed with great mentors. And Tom is at the top of that list.
When you talk about partnership, can you talk specifically about the things that you're able to engender that kind of response from people so that they trust you and they recognize that partnering with you opens up opportunities? I know how that works. But there are things that you do, if you can highlight a few of them, to maybe educate people on things they can be doing to engender partnership.
TOM STRAUSS: Well, you used a word, Jeff, that is a special one to me, which is trust. As you know, you asked me to join the investment banking business five years ago. I thought you were crazy. I've never been an investment banker a day in my life. But I asked you some questions. I got answers, talked to you and Larry, and said, 76 years old-- I'm going to do this. And I found out pretty quickly that in order to be successful, I was going to have to build up trust in various groups with whom I worked.
And it happened much more quickly than normal. Normally, trust is developed over a long period of time. You have your ups and downs with people. But I think trust is at the cornerstone of partnership. I've been very pleased that my partners, colleagues, we've developed in trust in one another, respect with one another. And that requires very good and open, honest communication.
JEFF SOLOMON: Just for some perspective, your decision, really, to pivot in terms of where you were going to focus your energies, at the age of 76, is remarkable in and of itself. For those who don't know, for the prior 20 years, focusing on the alternative investment management business was really what we did at Ramius and where you continue to do it at Cowen Investment Management.
I will just say, at 76, I hope to have as much adaptability as you do. But the cornerstone of what you were able to do is similar, which is to be able to figure out how you can be helpful. And that's a big Tom Strauss characteristic, which is, you come into the room, and the first thing you're asking-- in so many words-- is, how can I help? It doesn't matter what you do in the organization or how you're thinking about it. Using those words, how can I help, engenders a degree of followership from other people that is hard to replicate.
And so, I don't want to put words in your mouth. But to me, the 25 years-- 27 years-- we've been doing this together, I have found your presence to be incredibly helpful. And that's probably something that everyone can latch on to.
JENN OCAMPO-KING: Absolutely. I think you've had so many amazing moments in your career, just listening to your story. What are the defining moments for you?
TOM STRAUSS: I'll do them in chronological order.
JENN OCAMPO-KING: Yes.
TOM STRAUSS: 1972, I became a partner. 1986, I was asked to become president of Salomon Brothers. 1991 was the lowest spot in my career, which I'll come back to in a moment. In 1995, I joined Jeff and Peter at what was then Ramius Capital Group, predecessor to Cowen. In 2009-- and I will flatter Jeff because he was the architect of the Ramius merger into Cowen.
And I can't forget 2023, when we sold Cowen to TD Bank. Pursuant to that, every one of my friends that grew up in the commercial banking business has asked me one simple question or made one simple statement-- well, Tom, now you're going to find out what it's like to work for a bank. And that's been a terrific experience for me so far.
But the one experience in which I learned the most was 1991 when we had a crisis treasury auctions at Salomon. We violated some rules. We discovered, to our dismay, what had happened. And we didn't react as quickly as we should have. That was a learning experience in a number of different ways.
And the most important was, I was asked by a friend of mine who ran a mid-sized Wall Street firm to come to his class in business ethics at NYU and talk about the Salomon experience. And I did, and agreed to, and woke up the following morning, and asked myself a simple question-- what on earth have I agreed to do? And it was 10 years later. I should have thought long and hard long before that what was the learning. But the learning experience was that every good CEO, every good group head needs one or two people that, when something really bad happens, they'll walk in the door, they'll close the door, and say, this is not what we stand for. There's something wrong here.
And that takes a lot of courage when things get bad. And I've interviewed dozens and dozens of CEOs. And everybody says, I have that person. And I know they probably don't. I tried to develop that person when I ran a business and went to great lengths, and realized, in an experience that was really not important, that this is a very hard thing to do.
JENN OCAMPO-KING: And how do you recover from that and move on and get that resiliency?
TOM STRAUSS: Well, you have two choices in life. Either something bad happens and you just can't put one foot in front of the other, or you say, look, I got to figure out how to put this behind me. And I was 49 years old. And I thought I was just starting. The first couple of years were not easy. I fought with the SEC for a year and a half. And that's nobody's first choice. But I was determined that I was going to find something else. Here I am today, and I'm a pretty happy guy at 81 years old.
JEFF SOLOMON: I didn't know Tom during the treasury situation at Salomon Brothers. But we got to know each other shortly thereafter. And I had read everything there was you could read about what happened in the treasury scandal. And maybe I had formed my own opinions based on what I'd read. And then I met the man, and there was a giant disconnect for me from what people had written about Salomon Brothers and who I found Tom to be as an individual.
We've all had moments in our career in which we've reached a bottom or we're feeling like things aren't going as well. When I did, in 2008, I had Tom to counsel and guide me and ensure that I continued to put one foot in front of the other, because-- and this is the thing, Tom. I'd love to get your opinion on this. The value of your future ability to do things is sometimes discounted when you're in the middle of the situation. Your value once you get through the situation to create more positivity is very, very difficult to see when you're in the middle of it.
I know the business we built at Ramius from 1995 would never have happened. My career would never have evolved the way it evolved if the treasury scandal hadn't happened.
JENN OCAMPO-KING: You would never would have--
JEFF SOLOMON: We would have probably known each other because we had enough mutual friends. But we never would have engaged with one another like this. And everything positively that got created, including the TD-Cowen merger, emanates from this seminal experience that Tom had, which was his low point. And I think if there's one takeaway-- and maybe you can agree or disagree-- everybody has low points. Things happen in people's careers. That's part of the business.
JENN OCAMPO-KING: And in life.
JEFF SOLOMON: And in life. It's where you go from here and the positivity that can be created out of that that is the most critical. Do you agree?
TOM STRAUSS: I totally agree. Look, we learn from our experiences, and we learn most from our failures. What did we do wrong? What could we have done differently or better? And I think, if you're a positive person, you try and build on those experiences. And that was clearly one of them.
You know, I'm asked a lot to advise young people. I tell them a few things. I say, look around, to which their response is frequently, I'm so busy, I don't have time. I said, that's not-- you have a minute a day, two minutes a day. You have a universe of talented people, first within Cowen, now within the broader TD enterprise. Look around. You're going to see some brilliant people.
You'll like some of what they do, and in some cases, maybe not. In the end, you're going to be yourself. But the opportunity to grow up in a firm of talented people, I think, is way underestimated. Become self-aware. Think about who you are and try and think about who you are in the context of how people think of you.
Jeff and I have worked with and for a lot of people that are very self-aware and some not so self-aware. I think the best leaders in any business have a high degree of self-awareness because they project legitimacy. They project who they really are.
And I guess I would say, finally, find a mentor. I can't tell you how to do it. Find somebody you respect that's more senior that's willing to invest some time in your future and develop a relationship. Some firms have elaborate mentoring programs. We do a lot of it. A lot of it's somewhat informal. But I think if you can find a mentor, you benefit a great deal.
And finally, I tell people to read. I'm dyslexic. I have ADD. Reading, to me, is a chore. But there are books that I've read, some of which Jeff has recommended, that I have found provide a view from the outside, which I've found extremely helpful.
JENN OCAMPO-KING: I love that. Tom, thank you so much for all these amazing advice and also just sharing your inspiring story with us today. I think we could close with, what are you excited for for your TD journey?
TOM STRAUSS: Oh, my. That's a great question, Jenn.
JEFF SOLOMON: Can you talk about the SRC a little bit too, because I think that would be helpful?
TOM STRAUSS: Sure. I spoke to both Larry and Jeff and said, look, I need a framework from which to help. Otherwise, I'm just going to throw darts at the wall. So they established the Senior Relationship Council. Actually, I prefer SRC. But we get that. Asked Drew MacIntyre and I to co-chair it. I was flattered, but Drew is a fantastic partner.
And I think that's given me personally an opportunity to help think about problems that I think we can help solve. We can't do it alone. But we can make recommendations to Jeff and Tim and Larry and Riaz, because it's a vast amount of experience sitting in that room. Everybody's been in the business 30 years or more, 40 years or more. So they've seen a lot. And if you can draw on that experience and pull things together as a result and make some thoughtful recommendations, I think that's terrific.
JENN OCAMPO-KING: It's exciting. Well, Tom, Jeff, thank you so much for sharing today. We're very excited to have you here at TD Securities. And congratulations on your 60 years, Tom.
TOM STRAUSS: Thank you.
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