New Dog, Old Tricks: Quattrone Back in Banking

“Like a long drink of water after a drought” was how one tech executive described to me the news that former IPO kingpin Frank Quattrone is getting back into the i-banking business.

Quattrone earlier this week announced he’s launching the Qatalyst Group, described in lush terms in a press release as a tech-focused “merchant banking boutique.”

A merchant bank is really just a tonier name for an i-bank, which I find sorta funny, given Quattrone’s long-celebrated pride in his working-class, South Philly roots. (The banker’s mustache and “loud” sweaters were the totems Quattrone maintained to differentiate himself from his stuffier peers back in the day.)

So is this a new Frank? Maybe. He still sports the mustache — but my, if he’s not looking svelte! And the man clearly believes in sticking with formulas that work, which in his case was threesomes. dc16989-a.jpeg For a time it was expected that Quattrone’s longtime partners, George Boutros and Bill Brady, would join him in a new venture, but they’re staying put at Credit Suisse. Instead his partners in Qatalyst are corporate lawyer Adrian Dollard (pictured here, on the left) and Jonathan Turner, a tech M&A expert (to Quattrone’s right).

Ever the fox, I suspect Quattrone is leveraging some good branding. At a moment when Wall Street’s bulge-bracket institutions seem anything but trustworthy, slapping a nostalgic label like “merchant bank” on his new shop is a differentiator. Oh and Qatalyst will be based in San Francisco, rather than Quattrone’s old stomping grounds of Sand Hill Road. A geographic attempt at cultural shift?

Silicon Valley has sorely missed its mustachioed dynamo since a run-in with federal regulators investigating “IPO spinning” at Credit Suisse left Quattrone with an obstruction of justice conviction in 2004. His conviction was overturned on appeal, and the government later dropped all charges against him in a deferred prosecution agreement. But by then the bottom all but dropped out of the IPO market, leaving VCs and entrepreneurs whining for the 18-month exits of the dot-com days.

Quattrone kept a low profile the last four years, which isn’t to say he laid low. Unable to hawk deals while his case wound its way through the courts, Quattrone kept his network well-oiled, using it instead to raise money for his favorite charity, the Northern California Innocence Project. (Schmidt is a donor, as is VC John Doerr.)

All along, friends and fans have been urging Quattrone to get back into business. It was rumored that Kleiner Perkins had offered him a partnership; there was also speculation that he would start his own hedge fund. Quattrone told the New York Times’ Andrew Ross Sorkin that he likes “the strategic thinking of playing three-dimensional chess.”

I’m guessing he’s also referring to the three strategies of merger, acquisition and IPO. As the recession worsens, the Valley will happily welcome more of any such deals, and Quattrone seems poised to deliver. “We believe the experience, perspective and judgment at the core of our advice will be of value to our clients, especially during challenging environments such as these,” the Qatalyst press release reads.

I had a VC tell me once, while I was reporting a story on Quattrone’s legal saga, that “Frank could single-handedly revive the tech IPO market.” I never believed that, but if enough other folks do, it might prove at least partially true. Now we’ll get to see.