While Stephen Schwarzman didn’t exactly come whipping out from behind a Corinthian column bearing $400 stone crabs, there were Corinthian columns and there was an unmistakably decadent air about this week’s champagne-soaked “Hedge Fund Rocktoberfest” held at Capitale – appropriately, a bank-turned-ballroom in New York’s otherwise gritty Bowery district.
During the past five years of economic chaos, a number of charities have quietly shelved their glitzy bacchanals in favor of decidedly less showy gatherings (London’s ARK Gala Dinner, known for its $10,000-plus ticket price, did so several months back). But on Wall Street, the optimism is roaring back with a vengeance – and all that comes with it, including big, blingy parties.
Investment managers with band names like “Flash Crash,” “Big Dog Party” and “JAM Partners” (JAM stands for Jacobs Asset Management, a New York-based private-equity firm) donned leather jackets and dark sunglasses, playing everything from double-necked guitars to harps (yes, harps) in support of A Leg To Stand On, a New York charity started by Wall Street hedge funders to raise money to buy prosthetic limbs for children in developing countries.
“The mood has definitely changed since 2008,” says Chris Heasman, director at Lazard Asset Management, who played lead guitar in a band called The Subscribers, at Wednesday’s event. “Back then, the feeling at these events was more like holy s***, the world is coming to an end. We saw reductions to charitable giving and financial uncertainty clouded everything. I think that’s changing. The mood this year was extremely positive.”
Indeed, so far in 2013, the U.S. has somehow managed to eke out its first sequential economic growth, as measured by gross domestic product, since the nation fell into a crippling recession in 2008. Perhaps it’s just a post-shutdown, pre-holiday endorphin rush, but throughout the cavernous concert hall, lit by blue neon light and filled with well-heeled executives who splashed out $300 a ticket to rub elbows, there was the palpable feeling that the worst is over.
Notably, the event was inspired by fund manager and the charity’s chairman, C. Mead Welles, who, while traveling to Indonesia on business in the 1990s, found himself “paralyzed by sadness” after witnessing a crippled child being dragged by two other children on a garbage can lid while he placidly dined on a nearby patio. “I had been complaining to myself about how hard I thought I had it,” he says. “I failed to recognize how lucky I was to have the life I did.”
Welles, who describes himself as an avid musician, brought the idea of starting a charity to help children with lost limbs to some musician friends – including Heasman – who then held an experimental benefit concert in the basement of the Chelsea Hotel, at the now-defunct bar, Serena’s, in 2004. “It was tiny; we only played for about 75 people,” recalls Timothy Wheeler, a bankruptcy lawyer who belted out The Black Keys’ “Lonely Boy” alongside Heasman before this year’s 1,200-strong crowd. “I guess it’s gotten a lot bigger since then.”
The event at the Chelsea Hotel event astounded all three of them by doing something none them expected it to do: make money.
“We didn’t think anyone would want to come out to see a bunch of guys like us,” Heasman says. “But a lot of people in this industry are musically inclined, so we issued a ‘call to instruments,’ and, suddenly, we had enough interest to play Planet Hollywood later that year.”
Participants in this year’s “Rocktoberfest,” which marked the event’s 10-year anniversary, read like a Who’s Who list of Wall Street, with performers from J.P. Morgan, Citigroup, Prudential, Credit Suisse, Tigress Financial Partners, Triogem Asset Management, Tourmalet Advisors and IntercontinentalExchange.
The benefit, which puts 100% of its proceeds toward programs in a dozen nations in Asia, Africa and Latin America, has so far treated more than 10,000 children.
“The tendency is for people to blame hedge funds as the cause of everything from financial disasters to global warming,” says Heasman, who plays once a month with his band for charity events only. “But they’re an incredibly giving bunch and I personally think this is one of the best forms of foreign policy the U.S. has, taking thousands of children and helping them so they can lead a normal life.”