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Thanks to the lure of dealmaking, both Gene McBurney (right) and Kevin Sullivan (centre) stepped back from leadership roles at GMP. Harris Fricker (left) took up the CEO mantle in 2010 (Clay Stang )
Thanks to the lure of dealmaking, both Gene McBurney (right) and Kevin Sullivan (centre) stepped back from leadership roles at GMP. Harris Fricker (left) took up the CEO mantle in 2010 (Clay Stang )

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GMP had been grooming Fricker for bigger things, making him president in 2009. Yet when Sullivan asked him about taking over the CEO job, Fricker hesitated. He loved banking. The strategy, the thinking, the idea of helping companies figure out their future—then making it happen.

He could also well end up taking a pay cut. Certainly he would make less than in the best years as a banker. He thought about it a week. Then he took the job, precisely because of the challenge of helping GMP buck the trend of independents that haven’t taken the next step. “Money, status, just weren’t the things any more,” he said. He wanted to be CEO because “I think this firm can be something that hasn’t been done before in this country, and that is be a large, viable independent alternative to the bank-owned dealers.”



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When the phone rings with a too-good-to-be-true rumour about a banker’s defection, or a loss on a trading desk, or a deal that’s struggling, or some other hot news tip, more often than not it’s about GMP. They rarely prove true. But these calls do prove one thing: The competition is fascinated by GMP.

Bay Streeters gossip about GMP more than probably any other firm on Bay Street. When bankers grouse about peers at other firms making too much money (generally defined as “more than me”), they usually point to GMP and its direct-drive pay structure.

“They are doing it now. It’s ‘Wekerle’s gone, Sullivan’s gone, Gene’s moving out of the business. They are all rich, fat, they don’t care any more.’ I know because I hear it from our clients, who are very loyal,” says Sullivan.

It clearly gets under Sullivan’s skin. He’s suspicious about this story, concerned that it will be full of rumours planted by competitors. “That’s my supposition because that’s the way I’m hard-wired now because they have bashed us continually.”

McBurney is more sanguine, wearing the attention as a sign of success. “Do you ever hear rumours about the Kansas City Royals? No. But you hear them about the New York Yankees. That’s just the way it is.”

Can GMP really be the Yankees, the long-lasting dynasty, when other firms have only managed a few good years before the stars fade?

Sumit Malhotra, an analyst at Macquarie Group who has followed GMP for years, sees ample opportunity if Fricker can pull off the transition from one generation to the next, and from the commodity-focused, small-cap stock firm to one with a wider range of products like bonds.

“Bottom line, if they do it properly, the next stage of GMP will be a dealer that remains more nimble and targeted than the banks, but also one that has more tools in the kit than smaller independents,” he says. “The names will change, but the structure remains in place for GMP to stay the pre-eminent name in the Canadian independent brokerage space.”





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A SUPER MODEL The leaders at GMP hold up Goldman Sachs Group as their model for an independent firm that has evolved into a dominant investment bank. It’s an audacious comparison, and not just because of Goldman’s size and success. Goldman epitomizes what all of “the 99%” dislike about the banking business, especially since Rolling Stone’s Matt Taibbi famously likened the firm to “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.”

Here’s a handy checklist for emulating Goldman, without ending up as a bloodsucking cephalopod:

DO • Take a small partnership and transform it into a far-reaching power

• Make millionaires of dozens of partners

• Be “long-term greedy,” shunning short-term temptations

• Become a finishing school for public officials

DON'T

• Advise Greeks on finessing their debt

• Have one of your directors make helpful phone calls to Raj Rajaratnam

• Create opaque collateralized debt obligations like Abacus—unless you want to pay half a billion dollars in fines

• Turn the finishing school into a “revolving door”

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