Thursday, December 8, 2016
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
14,865 Blog Posts

The Important Matter of Wood Leads

In a brokerage firm there is a hierarchy.  There is the boss, partners, senior brokers, junior brokers, account openers and the lowly cold callers. The cold callers work for the account openers, who work for the senior brokers. The junior brokers, generally speaking, are new and without coin. Therefore, they are pikers and cannot afford to staff up.

When I was a cold caller, I got paid $190 per week, working for the biggest broker at the firm, who employed an army of 6 account openers, a dedicated secretary, and about 10 cold callers. Typically, account openers were paid the princely sum of $400-500 per week. It was a machine. The cold callers got around 5-10 leads per day, which was then passed onto the account openers, who’d open 1 out of every 10 leads. After the account was opened, the senior broker would “second trade” the new account and try to raise big money. In the event the new account was a dead end, he’d send the account to junior broker to work, splitting the commissions 50/50.

In the brokerage business, time is money and senior brokers don’t have time to waste on clients who are small or unwillingly to gamble recklessly with his life savings.

This firm that I worked for was the Godfather of high sales tactic mentoring for young aspiring brokers out of college. It was a place that can never be duplicated, because it was the thing of legend.

The firm was situated so that every broker, big and small, was in the boardroom. There were no corners or cubicles. It was like a giant airplane hanger with men smiling and dialing, pitching people so that they could meet their monthly lease payments. There was about 100 brokers, 50-75 account openers and another 100 cold callers, all in one giant room. Only management had offices–but they were rarely in them– since they’d prefer to police the floor for brokers violating rules, such as looking at charts or not dialing for a period longer than 1 minute. EVERYONE was pitching, non-stop, from morning to night.

You had one job to do at this firm and that was to sell. We were told, ad nauseum “we’re not fund managers here. We are here to sell stock. That’s it.”

Morning meetings started at 8 am sharp. If you were a broker and walked in late, while one of the partners was giving a speech (always by way of microphone, at a podium), you were fined $1,000. If you were a lowly cold caller or account opener, more often than not, you were fired for such an offense. I recall getting off the train at 7:58, knowing that I wouldn’t make it in on time and resolving such a crisis by hopping back on the train and calling in sick. It’s also worth noting that this firm practiced Darwinism with regards to the amount of chairs/desks available in the cold caller pits. There was always 5-10 less chairs/desks available than actual employees. Those who didn’t have a chair were tardier than the others– and was sent home without pay.

If you were still on the phone as the meeting began, your phone call was put on the speaker system for everyone to hear. Everything you said was critiqued by just about everyone, especially the bosses. The top partner, who gave the morning and evening meetings, would often walk over to the person who was pitching and feed him lines. If that didn’t work, sometimes he’d take the phone from him and convince the guy on the other end of the phone to buy stock. Like I said, it was surreal.

After the meetings, it was time to get to work. Being a lowly, unlicensed cold caller, I was not permitted to solicit stocks. My job was to call as many people as I could, from leads provided to me by my senior broker, and qualify them. Some brokers are more lenient than others in this regard. But my broker insisted that a qualified lead meant the gent had to have 500k+ in the market, did business with more than one firm, and was receptive to doing business over the phone. You had to find out at least one stock that he owned and what firms he did business with. It was imperative that this information be credible, else the account opener would look stupid and lose the initiative when making a sales call.

Generally speaking, an account opener would call a “new lead” after literature was mailed out and introduce himself by saying “you spoke to an associate of mine and you said you owned 5,000 shares of GE with Piper Jaffrey, is that still the case?” Now if the information wasn’t accurate and the “lead” said “no I don’t know what you’re talking about”– the account opener would have to re-qualify that lead, which pretty much meant the sale was dead.

Cold callers were under intense pressure to get leads. During lunch, senior brokers would visit our confines to “skill mill.” Essentially, he’d teach us how to talk to people with money and test us by randomly picking on one of us to pitch him. You had to get up in front of 100+ cold callers and qualify the senior broker, who, more often than not, was completely irrational–just to make life hard for whoever was pitching him. We did this three times per day, morning, lunch and after the close.

If you didn’t get 5-10 leads per day, you were not going to earn the right to study for your series 7 and start making the real money. And, you’d probably get fired. Most cold callers were miscreants of the first order, totally devoid of honor and integrity. They’d simply make up stuff, write it on an index card, and hand it in. They hoped to guess right, putting popular stocks like Lucent and Microsoft on the lead, but it backfired very, very often.

If your lead was bad, it was called “wood.” If you gave your account opener a wood lead, he’d walk over to you, rip it up and throw it in your face. If you did it again, you were fired.

I made it a point to never lie about the leads that I got. I took pride in my leads and worked until midnight, if need be, to get 10 leads per day. No one worked longer hours than me because no one was as hungry as me, living in a basement apartment in Brooklyn with my wife and new born son. My family didn’t have money, since my Grandfather decided it was a good idea to burn his furniture stores down, as some sort of idiotic insurance racket. Shortly thereafter, he lost his vision and was unable to work. Karma can bite hard sometimes.

So I had no choice but to bank coin, else I’d end up being a loser and that was not part of my gameplan.

After nine months of working at this stock broker pressure cooker, I was granted the right to study for my series 7. It was a major accomplishment. I had to pitch the CEO of the firm for such a privilege.  Things were going well and I knew it was only a matter of time before I too would be making 200k per month. I knew how to sell and that was all that mattered, at least that’s what I thought at the time.

Then one day a junior rep, who looked like a leprechaun, walked over to my cold caller desk, ripped up a lead and threw it in my face. He said “stop writing wood” and walked away. Back then I had a very bad temper, being that I felt the world was always working against me. So I got up, walked over to my senior broker, who I respected immensely, and quit. He called me that evening in an attempt to get me back, but I was gone. I couldn’t go back to that place after being insulted–a small pet peeve of mine picked up by my Italian Grandfather who fancied arson to get ahead in life.

By the end of that week, I had a new gig at a much smaller firm, working for a much smaller broker, who once tried to order me to get him coffee. That didn’t work out well for him.

To be continued.

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  1. ultramarine

    Dr. Fly, could you have complained about the junior broker and had him punished? Maybe the junior broker had it in for you. Just curious since I’m terrible at office politics so wanted to see what the alternatives were.

  2. Paul

    Fascinating. I’d have punched the fucker.

  3. Belly of the Beast
    Belly of the Beast

    Can’t punch the fucker.


    This is brilliant. I want to see the rest as this is better than seeing tits down here during the first parade of Mardi Gras.

    I always thought the movie boiler room was full of inaccurate BS,however, the details that you used to describe your past firm sound quite similar.

  5. jimmy_two_times

    Now they just pitch plans and SMAs. Very few actually pick stocks anymore – too much risk for the firm.

  6. TraderCaddy

    I guess I always used different tactics.
    I always plotted my exit ahead of time and used it to my advantage.
    My first attorney job was in Downtown Miami (Flagler St) and it kind of sucked. I was always looking for an out and was eventually contacted for an interview with a firm in Orlando. I told my Secretary on the day of the interview that I was going to the law library to do research (no cells back then). I caught a plane, did the interview, and got hired immediately.
    I was back in the Miami office by 4:30 PM and acted like nothing happened. The Miami group had no idea I as unhappy and thought I loved working there.

    • Anton

      But to whom did you bill those hours, TC?

      • TraderCaddy

        The time sheet probably went like this:
        Research (recent developments)and Preparation of Memorandum of Law and Pleadings in Support of Motion for Summary Judgment re: Uniform Commercial Code and International Standby Letters of Credit issued by Correspondent Financial Institutions -7.5 hours.
        Who wouldn’t pay this?
        Now days there does exist companies (usually former practicing attorneys) who audit legal bills. The clients hire them and they go into the files looking for double billing, overcharges, etc. Just like medical billing auditors.

        • Anton

          Thanks for the condor. I’ve really never questioned a bill from my lawyers, though I’ll never hire my most recent real estate attorney for anything again. Too much boilerplate, not enough rigor and specificity in the contract for what he billed.

          These “origin tales” from Le Fly always bring out interesting comments from the longtime readers here.

    • STAugustine


      I don’t think I’ve ever met a “happy” lawyer who enjoyed working at his/her firm.

  7. theedge111


    Sounds almost like a boiler room. Was your boss Ben Affleck?

  8. Bullish

    It’s a chop shop Fly!

  9. dubvfan87

    Very inspiring. I’m pretty fresh out of college myself, living in one of those basement apartments, determined to win.

  10. dizzles

    stratton oakmont?

  11. dk

    Back in the good ole days I was president of a small media company and evidently was on a list of those with money to burn. Once a day I would get calls from guys who would pitch me stocks… let’s build a relationship… just buy 200 shares… special opportunity and all that crap. I would politely tell them no thanks.. then impolitely tell them no thanks,,, then insult their manhood.. then tell them to fuck off and they still wouldn’t get off the phone. Had to hang up on them most times. What a way to earn a buck.

  12. NeedAMillion

    Wow, I didn’t choose that life. I would have failed. Master Fly is brave to quit and is lucky to find work afterwards.

  13. bobbin4apples

    College Works Painting was the same gig only instead of stocks it was exterior paint jobs we would sell. High turnover rate because its door to door sales and kids these days.

  14. buylo

    No wonder you identify with that schmuck, Romney, renting a basement apartment and all.

    • Mr. Cain Thaler

      Just observing my fellow citizens, if you identify with a leader, there’s a good chance he’s a lazy, plotting idiot

  15. john

    I started and ended at Gruntal. They were the oldest and best so they said. Sounds like the same garage everywhere. I remember touring a few bullshit firms in chicago. They all had the golden tee machine and a pool table. I finally found out what the were for: Golden tee for doing coke lines and the pool table was for hooking up with the girls. Unreal. And I always loved the clowns who had the four screens set up for charting.

  16. JC

    Great story Fly.


    Fly…I want the rest of this story

  18. Francis

    Quelle belle histoire Monsieur Le Fly !

  19. mrboulders

    awesome story!
    Brings back fond memories of working in an IR firm in Vancouver – hired at the peak of the dotcom boom, promoting lots of small OTC and venture exchange deals. Met lots of shady characters and it really opened my eyes, challenged my morals and solidified my resolve to succeed with integrity. Incredible experience and good times for sure!
    Looking forward to Fly’s part 2…

  20. noodleboy

    Bull flag gonna break upwards, gap higher after MLK – NASDAQ. it seems almost obvious.

  21. Robert Wesolowski

    Gaines Berland

  22. Raise taxes, Cut spending
    Raise taxes, Cut spending

    Sounds like Michael Lewis.

  23. The Hoonster

    The “New” Fly – priescent, but not predictable. . Prosperous, but not preposterous. Private, but not presumptious. Pithy, but not preppy……more.

  24. Samiam

    I graduated from Wharton and then got a job as prop daytrader trading OPM at tradescape that would later be sold to Etrade.

    Glad I never had to cold call shit. If I wanted someone to buy 1000 or 10000 shares of CMGI it was me pressing shift B on my dell keyboard.

    Like a fucking G homie