Inside the M&A Giant

August 1, 2007
Cohan: witness to Wall Street

Cohan: witness to Wall Street

Conspiracy of the cosmos alert: Another Duke graduate who worked at JPMorgan Chase released a book about the financial industry the same week Dana Vachon '02 did. William D. Cohan, a former managing director at the bank, was even fired partly in response to the bad blood he shared with one of the people who threw Vachon's New York book party.

The Last Tycoons

But the coincidences stop there; Cohan '81 has written a very different book from M&A. The Last Tycoons: The Secret History of Lazard Frères & Co. is a deeply reported and long (752 pages!) accounting of a firm that had, until now, done a remarkable job of keeping its private history exactly that: private. Although Lazard essentially invented the mergers and acquisitions business and has, for generations, served as a factory for financial superstars—André Meyer, Felix Rohatyn, Michel David-Weill, Steve Rattner, and Bruce Wasserstein foremost among them—it had managed to retain a certain mysteriousness. There was a carefully cultivated aura to the place, a sense that you could never truly know it unless you were of it. And that's what made Lazard such a compelling subject for Cohan.

His fascination with the firm developed in the mid-'80s, when he was completing his degree at Columbia Business School. He had tried journalism for several years before that, working for The Raleigh Times and at a small weekly in Salem, New York, but he was, by his own admission, "one of those 'change the world' journalists," and he didn't find the work fulfilling enough.

"I remember thinking, 'Why am I writing about people? Why am I not out there doing?'" he says.

So he went for his M.B.A. and wanted, more than anything, to land a position with Lazard. He interviewed, and, like countless other applicants before and since, he didn't receive so much as a note or phone call telling him no. Then, two years later, he interviewed again and got the job. He'd spend six years there.

"On the one hand, it was like a dream come true," he says. "There I was, with all these famous people, all of them working on the best deals. But on the other hand, it was a very hard place to work."

Cohan remembers a time when three of his clients asked to be introduced to Rohatyn, then one of the five most famous bankers in the world. Cohan set the meeting up and Rohatyn, full of his usual bravado, bounded into the conference room and shook Cohan's hand as if he were one of the clients, seemingly unaware that Cohan had worked with him, in a small office, for over five years. Three months later, with a different set of clients, Rohatyn made the exact same mistake.

That kind of behavior ultimately wore on Cohan, who claims never to have developed the bloodlust of others on Wall Street. So when he was released from JPMorgan Chase in early 2004, he was happy to return to his journalistic roots, and devoted himself entirely to the book. He interviewed more than 100 people (including all of Lazard's biggies, except Wasserstein), sifted through boxes of untouched source material, and ultimately wrote the definitive account of the firm—all in a blisteringly fast two-year period.

The biggest scoops in the book—which is impressively not dry, considering the topic—are by turns tragic (Meyer's heartless dismissal of the man who ensured his safe passage to America during the Second World War), wonky (how the firm almost fell apart during the infamous ITT/Hartford hearings during the Nixon administration), and gossipy (Rohatyn's alleged love affair with Jackie O). For Wall Street, this is spicy stuff. Cohan heard that the white-shoe law firm Wachtel, Lipton, Rosen, & Katz bought eighty copies of The Last Tycoons, presumably to have their attorneys sift through the book and see if anything was libelous. So far, so good: no lawsuits.

"Ken Jacobs, who now runs Lazard in North America, told me, 'We always figured that someone was going to come along and write this book. And in a way, we're glad it's you, because you worked here, you know Lazard, and you know Wall Street better than some outside journalist,'" Cohan says. "Well, I wonder if he still believes that."