Goldman Sachs President Enjoying DJ Activities... "Big Success Thanks to Client Support" Controversy

Last July's Hit Song Remix 'Daebak'
Controversy Over Music Company That Helped Being a Goldman Sachs Client

[Asia Economy Reporter Jeong Hyunjin] David Solomon, CEO of the American investment bank Goldman Sachs, has come under controversy over his hobby as a DJ. It is reported that he received help obtaining DJ remix copyrights from a Goldman Sachs client, raising suspicions that he might be using his investment banking connections to run a personal business.

David Solomon, CEO of Goldman Sachs [Image source=Reuters Yonhap News]

The New York Times (NYT) pointed out on the 5th (local time) that the boundary between Solomon CEO’s main job and his hobby as a DJ is unclear, warning that his hobby and banking work could potentially lead to conflicts of interest. The NYT reported, "He has built connections within the music industry that could assist his hobby through his work at Goldman Sachs," adding, "It raises questions whether the opportunities (such as remixes) came because of his talent or because of his position as the top investment banker on Wall Street."

Solomon CEO, who is over 60 years old, is active as a well-known amateur DJ under the stage name 'D-Sol,' performing at famous music festivals. Last July, he released a remix of Whitney Houston’s hit song "I Wanna Dance with Somebody," which has been streamed over 3 million times on Spotify, the world’s largest music platform, as of early February.

The issue arose during the process by which amateur DJ Solomon CEO obtained the opportunity to remix Houston’s hit song. Generally, remixing a hit song involves copyright issues that even major record labels struggle to resolve. The NYT pointed out that Larry Mestel, CEO of Primary Wave, a music company client of Goldman Sachs, proposed to Solomon CEO to remix Houston’s song and provided significant help in resolving copyright issues. Essentially, Solomon received substantial assistance for his private DJ activities through a client of the investment bank where he is CEO.

According to reports, Mestel CEO stated in an email to the NYT in November last year that he proposed the remix of Houston’s "I Wanna Dance with Somebody" to Solomon CEO in 2021. Mestel then personally met with Houston’s family to obtain remix approval. He also secured approval from Sony Music Entertainment, which owns the original song.

Guillermo Page, a professor at the Frost School of Music at the University of Miami, pointed out that it would have been much more difficult for an amateur DJ without connections to Mestel to obtain remix rights for Houston’s hit song.

What draws attention here is the relationship between Mestel and Solomon CEO. Primary Wave, managed by Mestel CEO, became a Goldman Sachs client in 2018, the year Solomon CEO took office as Goldman Sachs CEO. The following year, Mestel CEO was selected as one of the "100 Most Interesting Entrepreneurs of the Year" by Goldman Sachs. Solomon CEO also established Payback Records in 2018 to handle his music projects.

Yaron Nili, an assistant professor teaching commercial and securities law at the University of Wisconsin Law School, criticized the mutual back-scratching relationship, saying, "If you scratch my back, I’ll scratch yours." Solomon CEO’s remix track has been streamed over 3 million times as of early February, and the average monthly listeners of Solomon’s entire music catalog on Spotify reach 600,000. Miami University professor Serona Elton evaluated this as "a very large number for a relatively unknown artist."

Solomon CEO reportedly states that all proceeds from his DJ activities are donated to charity. However, there are also criticisms that Solomon CEO uses company employees for his personal music business, including DJ activities. Goldman Sachs employees are reportedly mobilized to manage DJ schedules and handle donation processes.

Brandon Lonertz, who worked as a social media manager at Goldman Sachs, told the NYT that he frequently communicated with Payback Records staff to discuss strategies for promoting Solomon CEO’s new music. An Instagram photo posted last fall by DJ Todd Wilkinson tagged Lonertz and a Goldman Sachs intern as "Payback Records staff," and Lonertz did not deny this, even responding with a thank-you emoji.

Goldman Sachs rebutted the NYT’s concerns, stating, "Solomon CEO’s DJing has nothing to do with the banking business," and emphasized, "Both Solomon CEO and Goldman Sachs are carefully attentive to separating his hobby from business."