What’s The Deal? | A conversation with Liz Myers, Global Chair of Equity Capital Markets
Catherine Guan: Hi, I'm Catherine Guan, a member of J.P. Morgan Investment Bank's corporate finance advisory team. Today, I'm joined by Liz Myers in this episode of What's the Deal? Liz is the global chair of investment banking, equity capital markets at J.P. Morgan. Prior to her current role, Liz was our global head of ECM, leading the team responsible for advising our corporate clients on equity capital raising in the Americas, Europe, and Asia. She has been named one of the Top 25 Most Powerful Women in Finance by American Banker magazine and won Barron's 100 Most Influential Women in U.S. Finance.
Liz Myers: Thanks, Cat, it's great to be here with you.
Catherine Guan: This episode is part of a special series entitled Conversations with Deal Makers, where we speak with the makers behind the deals, and delve into the stories behind the headlines. Liz, I have been looking forward to this conversation ever since launching this series. Since joining the firm, I've had the pleasure of working with you on many transactions, and you always bring such differentiated insights into each discussion, be it pressing and offering volatile markets or advancing women in the workplace. For our conversation, I want to start at the very beginning of your journey at J.P. Morgan. After graduating from Princeton, what made you choose this firm above all else, hmm?
Liz Myers: Well, I was an economics major at Princeton, and so it was somewhat natural to think about finance, but there wasn't a lot of information about it. The internet didn't exist, and I knew no one in investment banking. So I really learned about the industry by going to interviews; not a strategy I recommend for today's college graduates. But I did end up with several offers in the field, and I accepted J.P. Morgan, really, for the quality of the training and the culture. Our training program was known to students as the best on the street, and even though I was an economics major, I knew I had a lot to learn.
Catherine Guan: And after joining the firm, I know you had a broad array of experiences across mills and mining, technology, media and telecom, as well as consumer M&A. What were some of the most memorable moments from those early years?
Liz Myers: Well, as you said, I had a number of different opportunities, and it was a great way to get to know what was different, among different sectors. When I joined the M&A team, I was in the consumer team, and we focused our sub team on food and beverage clients. One of my favorite transactions of my career was Anheuser Busch's first domestic Chinese acquisition that I had the opportunity to work on. They targeted the Junga Brewery, which was interestingly headquartered in Wuhan. I had one day's notice that we needed staffing on this deal over in Asia. I flew to Hong Kong, and I joined the Anheuser Busch team at Wuhan for the due diligence on the brewery and the dinners with management. It was the first time I'd ever been in Asia, and it was fascinating. This was right when the world had started to realize China had a lot of people that were becoming able to buy more and more consumer goods, and Anheuser Busch was the leader in entering the region.
Catherine Guan: That’s so interesting. Liz, could you tell us a bit more about that?
Liz Myers: When I returned after the transaction, J.P.Morgan’s Chairman and CEO Sandy Warner was on the board of Anheuser Busch, so I was called to his office to give him a debrief on the transaction, kind of an interesting and exciting opportunity for someone who was only 24 years old. And after that, I remember also going off on a tour of Japan to see Kirin and Asahi and Sapporo, the big brewers who were interested in understanding what Anheuser Busch was doing over in China. I almost missed the deadline for applying to business school because of that trip. In fact, I did miss the first deadline and had to apply a couple months later, but I ended up being accepted to Harvard Business School, and I left the firm for a couple of years to pursue that degree.
Catherine Guan: I now know exactly the woman to call if I need a recommendation for Asian beer. And speaking about your experiences at Harvard, I would love to hear about, what made you decide to come back to J.P. Morgan after seeing what else the world had to offer?
Liz Myers: Well, the firm was great in keeping in touch and recruiting me back. And I had looked at some other opportunities, but with a little self-reflection, realized that I really wanted to be in client service, and I loved the fast pace of investment banking. I had tried consulting over my summer of business school, and just really missed the variety of work that came with being an investment banker, and being able to leverage the same skills for different transactions in a way that's really uniquely true in banking versus consulting. When I came back to look at the firm, I looked at a few different areas within the investment bank, and I found my way to equity capital markets, which I had considered pre business school, when I was an M&A, but I was having such a good time in M&A and loved my bosses, and I really didn't wanna switch at the time. So when I returned, it was a clean break.
Liz Myers: And when I was in business school, the internet was just beginning to be pervasive. We all had our new AOL school email accounts, and it was the time when Amazon had made a few offers to people in my class and a job like that was viewed as a major career risk. Within a couple years of rejoining J.P. Morgan in equity capital markets, the tech boom was going full steam, and companies that had no real business plan were going public at eye popping valuations. And we had just gained equity powers in the early 1990s, so we were still learning about leading IPOs, and were successfully parlaying a lot of these client relationships into ECM mandates. And then, in 2000, we merged with Chase, and with that came the HQ franchise, which was a known tech specialist investment banking boutique in California. And soon, most of us in our group, which was still pretty small, were pitching tech IPOs, flying back and forth to San Francisco sometimes twice a week. It was quite a bubble at that time.
Catherine Guan: The financial crisis presented a tremendous amount of challenge, yet this was also an incredible showcase for those with ability. Could you tell us about how you assumed increasing responsibility within the ECM franchise?
Liz Myers: Back in the late '90s and early 2000, we felt it really was a bubble. But the internet, we also knew, was a complete game changer, and investors didn't wanna be left behind. And then it ended swiftly. What a great lesson early in one's career, to see exactly how the music stops and how you have to live through it. So let's just say I was glad I had done some financial services deals before that tech wave, (laughs) so I was able to pivot back into some of these more stable sectors, and did some consumer and industrial deals, as well. It was helpful to have had that diversity, but also very helpful to have had the opportunity to see how such an acceleration in business happens, and then what are the catalysts that cause a, cause a pivot. Starting in 2003, I was charge of the financial services team within the ECM group.
Liz Myers: And it wasn't until the financial crisis that I think I really had established the base of experience and credibility to be promoted, to run the Americas team. My sector had been pedal to the metal in the crisis. We were recapping all the banks across the US when their loan portfolios were deteriorating as a result of the crisis. Corporate borrowers were not repaying their loans, mortgage portfolios were a mess, and many of the regional banks were really struggling. We were the go-to bank in the crisis. We were viewed as the firm that could understand the complexity of deteriorating loan portfolios, and be able to attest to investors what we thought was a reasonable clearing price to raise capital for a lot of these banks. Jamie had made it clear on Capitol Hill that J.P. Morgan was stronger than any other bank and that we didn't need TARP money to stay alive. We took it to be part of restoring confidence in the financial system, but the repayment of that TARP money was a great deal opportunity for me and my team. And that deal was my first chance to meet Jamie Dimon.
Catherine Guan: And Liz, what did you takeaway from that experience?
Liz Myers: So after the crisis, I was asked to be co-head of America's ECM, and then later, the global head, which I did for seven years. By that point in time, my M&A experience seemed a long time ago, and I'd really become an ECM subject matter expert. And with a focus on a single area sometimes comes a feeling of repetition. And so I really enjoyed the change to take my ECM knowledge to new geographies. There are different securities regimes all over the world, different cultures, different ways people expect to be managed, different levels of success and different goals to achieve. So it was a really fantastic and fun time.
Catherine Guan: And running a global business must have brought such a unique set of rewards and challenges. The two of us had the opportunity to work together on a series of monetization transactions for Alibaba, the US domicile successor entity to Yahoo, which involved its holdings in Alibaba the Chinese tech giant as well as in Yahoo Japan. It was so impressive to see you lead the global execution team involving ECM colleagues across four time zones, New York, San Francisco, Hong Kong, and Tokyo. What was your guiding principle for delivering the J.P. Morgan global platform to clients?
Liz Myers: Well, firstly, have a great team with you, and that included you, Cat. (laughs) You were a secret weapon, I often said, keeping track of a lot of complexity. We sold over $50 billion of Alibaba stock day in and day out over a series of many, many weeks. And that was the type of transaction you needed to have laser focus on at all times.I think it was my experience in running the global ECM team that made me confident we could do this seamlessly across time zones. One of the big priorities I had when I was running global ECM was making sure that there were personal relationships between our personnel across the globe.
We used to run off sites once a year for the global seniors, and people really got the chance to know each other personally. And there's nothing like knowing someone when your phone rings at 2:00 AM. You know that you're going to take it if it's someone you know well.
Catherine Guan: Absolutely. There's nothing like that personal connection. And speaking of our experiences together on Yahoo and Alibaba, we had the opportunity to present to the board together on a number of occasions. Looking around that room, I remember thinking to myself that it was such a sign we had female representation in each of management, the board, and investment bank. As boards continue to focus on diversity, equity, and inclusion, have you noticed any changes to how decisions are now being debated?
Liz Myers: I've seen the progression, particularly in the boardroom of diversity over the many years of my career. and just a few weeks ago, I was presenting to a board that was over 70% women, including the chair of the board. So times are definitely changing.
And I'm so glad we have our Director Advisory Services Group at J.P. Morgan, because so many of our corporate clients are looking to diversify their board members. There are lots of board members that are up for retirement in the upcoming years, and generally, corporations are replacing board members, with a priority towards diversity. And we have a database of over 5,000 board members, of which over 50% are diverse individuals. So we can really help clients with what their objectives are and having more and different perspectives and voices in the boardroom.
Catherine Guan: Liz, you have been such a powerful advocate for women in the workplace. Here at J.P. Morgan, Women On The Move is an initiative to empower and advance our women employees. And now, we're looking to build on our c- success and to reach externally. Could you tell us a bit more about your work with Women On The Move as a member of the executive committee?
Liz Myers: Well, I'll say I've always been involved throughout my career in mentoring and sponsoring women. And I've been the beneficiary of exactly that over many years at J.P. Morgan, both by senior men and women. And being part of Women on the Move is just a natural progression of that. We've made a big commitment to our female employees, but also to female owned or managed businesses among our clients, both with support of our capital and our advisory resources. We had our big flagship Women on the Move Leadership Day, which brings together thousands of female employees and male allies and a ton of female clients for a really impressive array of content. I'm really excited every year for that to happen each fall. And we really want our clients to know how much we prioritize helping women succeed in the workplace. We run a lot of client events in the investment bank, and we've made it a priority to have lots of impressive women both in the audience and onstage delivering valuable content.
Catherine Guan: And when you spoke at the beginning of this episode about starting your professional journey at Princeton, it must be especially poignant this year to see your daughter start her freshman year. For young women of her generation, what kinds of progress do you hope to see in the workplace?
Liz Myers: Well, I hope to see that companies across the world will have the same approach that we do at J.P. Morgan, which is we want the best person. What we want is someone who's enthusiastic about what we do, excited to learn, and really wants to contribute and be part of a fantastic team. Those are the types of organizations that will be great homes for women out there that are graduating from college or women that are looking to change their career or employer.
Catherine Guan: As we turn towards the final minutes of our episode together, I want to turn our gaze to the current moment in time. We touched earlier on your experiences during the volatility of dot com and the Great Financial Crisis. What is your number one advice for clients navigating these turbulent waters now?
Liz Myers: My mantra for clients who need advice in difficult environments is be ready. Nothing substitutes for preparation. And whether it was the tech boom and bust in the early 2000s, the financial crisis, the COVID crisis, each time was unique. And helping corporate clients access the capital they need or consummate a transaction, those have always been our most critical priorities.
Our late vice chairman, and a beloved mentor of mine, Jimmy Lee, always said, "When the going gets rough, just keep calling (laughs) clients." We often underestimate the value of pattern recognition in solving problems. And when clients ask you questions, your off-the-cuff answers can be really valuable.
Liz Myers: When the window opens in the market after a bad period, it generally doesn't open wide and beckon issuers back to the (laughs) promised land. It often opens very selectively and temporarily. And that's what we've seen in 2022, and we've managed to lead the two biggest IPOs of the year, both of which J.P. Morgan had the leading or sole role, and both of which I had the pleasure to work on. The first was the private equity firm TPG's $1.1 billion IPO back in January. At that time, we didn't imagine that would be the biggest one for months later. And then finally, we topped that size with AIG's $1.7 billion carve-out of its life and retirement business core bridge that we just completed in September.
Liz Myers: And in both cases, trying to thread the needle for the perfect moment was the key strategy. Before that was months of preparation and a detailed monitoring of daily events in the markets, daily conversations with investors to understand sentiment. That was person by person, day by day.
In turbulent times, what an investor said last week is not always relevant. Being the most frequent underwriter of new issuance means we have the deepest and most frequent touchpoints with individuals who anchor big mission critical deals.
We succeeded in both those transactions, and the market deteriorated really quickly thereafter. So timing is everything, and if you're not prepared, you'll miss the window.
Catherine Guan: Absolutely. And looking ahead to 2023, what are your top priorities?
Liz Myers: Well, I would say my priorities for 2023 really include helping clients adapt their capital structures to the new environment. There's a clear investor preference now for lower leverage at companies. Coverage levels are becoming more in focus than just leverage levels. The cost of the same level of debt is now more. Recession proofing balance sheets is really important. And in certain sectors, the capital management story, meaning share purchase, dividends, that's a key focus for some companies to help support their stock prices in volatile markets.
And with higher growth sectors, we're helping clients accelerate their path to profitability and redesign their capital raising plans around that transition, because just like the leverage point, investors are speaking loudly about their preference to a very near-term profitability profile for companies they invest in.
Catherine Guan: Liz, it's been absolutely fabulous to have you here with us.
Liz Myers: Thanks so much, Cat, it is always fun spending time with you, and I really enjoyed our conversation.
Catherine Guan: That's all for this episode of Conversations with Deal Makers. Stay tuned as we continue the dialogue with the makers behind the deals and delve into the stories behind the headlines. We look forward to having you join us for the next conversation.
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