Conquering Wall Street and possibly Pennsylvania Avenue: Mizuho Securities CEO John Koudounis
by Dimitri C. Michalakis
So how does a Greek whiz kid from Chicago become the youngest CEO on Wall Street and lead a venerable Japanese bank to an impressive string of victories in the ultra-competitive US market?
“First and foremost, it’s all about the team we assembled, a team of All-Stars,” says John Koudounis, 48, and since 2010 the president and CEO of Mizuho Securities USA (whose parent company has about $2 trillion in assets). “We had the ability to do that because when other banks were cutting back during and after the subprime mortgage crisis, Mizuho was able to attract talent because of our strong balance sheet and culture of accountability. People could see where we stood.”
And if they still didn’t see, Koudounis could explain it to them on TV where he’s a regular on financial news programs (him and Maria Bartiromo dishing the markets) or participating in the prestigious Milken Institute or the Bretton Woods conference in DC where he had the opportunity to meet with IMF chief Christine Lagarde and former Federal Reserve Chairman Paul Volcker, among others.
“I think being visible helps put our institution on the map,” he admits frankly. “Even though Mizuho has a sizeable presence in the U.S., until now we were not that well-known. Wall Street is the most competitive place in the world and you have to be known to be in the game and be part of the group. And, yes, you have a better chance of getting that deal if you’re part of the group.”
The deals Mizuho has engineered that have catapulted it up the league tables include Softbank buying Sprint ($21 billion) and Actavis buying Forest Labs ($25 billion).
“We’ve been involved in pretty much every major cross border transaction in the last few years,” says Koudounis, without breaking a sweat. And he’s gotten used to adding all those zeros. “When I started in the business a $100 million bond deal was a big deal. Then it became the first $1 billion deal. Now you do $3-4 billion deals and it’s just another day. It’s just adding more zeros.”
But, he says, getting a deal done not only requires the backbreaking work of crunching the numbers and taking the temperature of the Street, but, increasingly, also taking the global view into account.
“The world has become a much more complicated place,” he says. “When I started in this business everybody spoke about the global and international view, but it wasn’t really there yet. Now it really matters what happens in China and what happens in the United States. If we sneeze, the rest of the world catches a cold.”
China, he notes, is the new factor in international finance and cannot be ignored. But dealing with Chinese companies requires a deft touch because the country still conducts business behind a silk screen.
“China is still a big question mark,” he says, “with accountability issues and transparency issues: a lack of knowledge about what’s happening in a lot of its companies. Whereas Japanese companies are far more transparent, with their accounting, with their legal work–it’s all very professional and very on-point.”
And what of countries like Greece that have become economic orphans?
“We’ve already started seeing recovery,” he says. “Full recovery is going to take several years—maybe five to ten. But that doesn’t mean there will be no progress in the next two or three years. I think they’re on their way. People realize they need political stability for the recovery to continue and I hope it’s going that way.”
He said it was a “great experience” visiting Greece recently with other business leaders and members of the Hellenic Initiative and getting to talk to Prime Minister Antonis Samaras.
“Mr. Samaras seemed very sincere in welcoming us and listening, and really wanting to help the country,” says Koudounis. “And that made us want to help and give our support. Through the Initiative we’ve been able to set up a number of programs, such as having several hundred interns from Greece work in different companies around the world. We’re feeding some of the poor with money we’ve all contributed and also raised. And we’re helping fund middle-sized start-up companies to try to stimulate the economy. We’re trying to do whatever we can do to help.”
Koudounis himself has been a wunderkind, but the road to his success wasn’t as easy as it looks. His father George came out of the Navy in World War II and worked many jobs to make a living, including selling hot dogs out of a wagon in Old Town (although he made enough of a success to buy several properties).
“We were not well off,” says Koudounis. “My father had to do many things to make a living.”
And his father and mother Dina (who still lives in the same house where her son grew up in Lincolnwood) were not very happy when he changed his mind about being a doctor—and a lawyer.
“Well, what do you want to do?” they said.
“I want to go into business,” he told them. “Wall Street.”
They were confused.
“Why do you have to go to school to go into business?” they said.
Nevertheless, when he graduated Niles West High School (captain of his football and basketball teams and president of his class), he fielded offers from several Ivy League colleges, before he chose Brown. In addition to its academic excellence, he felt Brown offered a diverse background and the chance to explore a different part of the country.
“That always intrigued me when I was younger—going East,” he says. “And Brown was a great place; very diverse, very international.” Which is why Koudounis majored in economics but also studied Diplomacy and Foreign Affairs.
He also lost his father when he started college (“That really changed my life and made me grow up very fast”) and quickly after Brown (where he starred in football) he started working for Merrill Lynch and moving up the ladder. From there he moved to ABN AMRO, a Dutch financial giant, where he became head of its U.S. Fixed Income division.
And he moved still faster by switching to Mizuho in 2008, where in its first year under his helm his division earned more than the entire firm had made in its entire history.
“Teamwork is a big part of this and there is also a certain type of network,” he says. “If you’re not on the inside, you’re not in, and it’s very tough. I was the youngest CEO on Wall Street when I came here, and it was at a Japanese bank instead of an American bank, which means I had to work harder than anybody else. And I did. And I also hired a lot of my guys from other banks that everybody knew so it’s hard for people not to do business with us.”
And besides finance, he might have other worlds to conquer down the road. He’s participated in conferences and meetings attended by political leaders from all over the world and he thinks he can fit in that club as well.
“I always thought I wanted to be in a leadership role,” he says, “and even as a kid I always thought I could someday be president. Politics fascinates me and the need for leadership only grows as the world gets more complicated.”
As head of an investment bank he’s used to working on the global stage and it’s given him a deep understanding of macroeconomic issues: something he believes is of critical importance to political as well as business leaders.
“Presidents and other political leaders need to have global experience and in investment banking you have to learn how to deal with the rest of the world,” he says.
Still, he adds, “For right now, I want to keep building our company and continue in this business; politics is not in my sights.”
He’s certainly busy enough. Koudounis travels all over the U.S. and the world (several countries in as many weeks) to visit customers and lock down deals, in addition to maintaining offices in both New York and Chicago. But despite the high- powered career, he makes ample time for his family, his wife Joanne and 10-year-old twin daughters Constance and Demi, named after their grandmothers.
“We’re very blessed,” he says. “They’re instant playmates.”
As for his future?
“The Mizuho Financial Group has fifty thousand employees,” he says. “Developing communications and relationships within this vast organization which spans the globe and incorporates many social and business cultures is a challenge. You have to see the human in every job. But maybe in the future I might do something on my own, or with other people. Or, who knows, maybe a kid’s dream can come true in America…”