Skinny on Cantor Fitzgerald's Build-Out And Hiring Plans

Cantor Fitzgerald & Co. increased its equities department headcount 20% over the past year, bringing those ranks to 400 traders and analysts worldwide, and may go on to increase its staff by another 100 professionals globally, according to recent comments by company CEO Shawn Matthews.

Cantor is hoping to build itself into a full-service investment banking boutique that's "trying to re-create a style of business that disappeared over the years as the bulge-bracket Wall Street banks tightened their grip on stock trading by snapping up smaller brokerages," according to a recent Wall Street Journal post.

Will the effort succeed? Maybe-though sales and trading positions will probably still be the easiest to come by early on, with capital raising and research appointments coming later on down the road.

Cantor is probably best known as the firm that lost an astounding 658 employees when its headquarters on the 101st-105th floors of One World Trade Center was wiped out on 9/11. On the business end, it has built a solid reputation on its bond brokerage and trading operation in particular.

"They have always been very strong in sales and trading," veteran recruiter Richard Lipstein of Boyden Executive Search in New York tells efinancialcareers.com. "The bigger strategic issue for Cantor has been in building out their investment banking and equity research capabilities.

"I have no doubt they would succeed if they continue to make the required investments and have sufficient patience," says Lipstein. "The question is, whether they have that patience."

With or without a successful transition into full-on investment banking, the company does have several nuts-and-bolts projects in the works that could spell jobs now or down the road. For instance:

- Cantor is expanding its range of products, including a recently launched trading desk for exchange-traded funds.

- New offices have been opened in Sao Paulo, Moscow and Beijing, and last summer, the company announced over a dozen key new hires in the UK, Italy, Ireland and Germany as part of its continued expansion into fixed income, asset backed securities, and structured credit markets in Europe.

- Cantor is also reportedly keen to expand its two-year-old equities business overseas, nearing a deal to acquire a brokerage firm in Ireland.

Matthews has not disclosed who Cantor has been courting but late last year the Irish Independent reported that it was rumored to be buying an Irish brokerage, and that one such firm under consideration at that time was NCB Stockbrokers.

Lutnick's logic

Interestingly enough, despite the great troubles that befell the firm on 9/11, company chairman Howard Lutnick (whose brother, Gary, died in the tragedy), has stated that the more recent financial crisis afforded his company a true opportunity-eliminating competitors like Bear Stearns and Lehman Brothers, which made mortgage bets that Cantor and its publicly traded BGC arm had avoided.

Lutnick has also said that his firm may go public in the not-too-distant future, having characterized the post-crisis period as such an opportune time for growth.

As recently as January, meanwhile, Cantor added former Credit Suisse executive Jarred Kessler as global head of equities. Kessler had been managing the credit focused equities business at Credit Suisse-a joint venture between the fixed income and equities divisions-and going forward is responsible expanding Cantor's global equity capital markets business.

Cut out to work at Cantor?

In announcing Kessler's appointment Matthew said his firm is scouting experienced sales and trading professionals able to bring their book to any platform. Appealing as much of this may seem, also keep in mind that Cantor has a reputation as a tough place to work.

On the plus side, the culture is dynamic and faced paced, placing a value on independent thinking. Thus, "If you have a good idea you can pursue it," says one Cantor Fitzgerald developer. On the other hand, it's often described as dog-eat dog. "For the hustlers and thick-skinned only," is how one past employee put it.