After everything that’s happened, Goldman Sachs probably wishes it had never pitched 66-year old billionaire Jim Clark (the founder of Netscape) on the firm’s big Facebook deal.
The billionaire founder and investor told Bloomberg Markets Magazine that when he got the pitch email from Goldman, he was instantly “irked.”
Now, he’s going after Goldman for pitching him on Facebook with a bad price and high fees on top of it, just meant to rob him of more money. And he’s spilling tons of details that Goldman probably doesn’t want its investors to know — including the fact that he received a better offer for Facebook elsewhere. And how his Goldman brokers called John Paulson a “bit player” in 2006.
Not surprisingly, the firm “declined to make Blankfein or any other executives available for comment for this story.”
Clark definitely has a grudge. Goldman already lost him a lot of money, he says. In 2009, he “angrily” yanked most of the $400 million he had invested in GSAM, Goldman’s asset management unit.
From Bloomberg Markets Magazine:
In June 2009, he had angrily yanked most of the roughly $400 million he had invested with the firm due to what he considered bad ad- vice and poor performance, including a big hit from GSAM’s Global Alpha hedge fund. This offer, he says, just irked him further.
A few months earlier, he had purchased a stake in Facebook through another firm for a lower price, he says, and without the onerous carried interest. “I don’t think it’s reasonable,” Clark says. “It’s just another way for them to make money from their clients.”
Here’s the reason he didn’t like their offer:
The firm would levy a 4% placement fee on clients, plus a .5% “expense reserve” fee. It would also require investors to surrender 5% of any profits, known as “carried interest,” according to a Goldman Sachs document.
To learn more about Clark (who’s married to a super-model), click here >
Read the full story in Bloomberg Markets Magazine’s cover story, “Lloyd Blankfein’s Headache.”