Key fundraisers are jumping ship from Joe Biden's struggling presidential campaign to instead support Mike Bloomberg's ascending candidacy.
The development comes amid growing concerns within Biden's affluent donor network that the former vice president is struggling to convince voters that he can defeat Sen. Bernie Sanders, a self-described democratic socialist, for the Democratic nomination. The financiers are also impressed with Bloomberg's self-funded operation.
Jon Henes, a partner at the law firm Kirkland & Ellis, has signaled to friends that he is shifting his allegiance from Biden's campaign to Bloomberg's bid to take on President Donald Trump, according to people with direct knowledge of the matter, who declined to be named as these decisions were made in private. Henes is one of close to a dozen other Biden fundraisers who have already decided to move toward Bloomberg, these people added.
Henes was also a key bundler for Sen. Kamala Harris before she dropped out of the race in December. A month after Harris left the race, Henes agreed to help the Biden campaign with fundraising. The financier co-hosted a New York moneymaking event on Thursday that brought in power players from Wall Street to back Biden.
Henes also helped raise at least $100,000 for Hillary Clinton during her 2016 run for president, according to the nonpartisan Center for Responsive Politics.
Many of the Biden donors who spoke with CNBC on the sidelines of the New York fundraisers last week said they felt the former vice president had rebounded in the wake of dismal finishes in the Iowa caucuses and New Hampshire primary. However, since then, some Biden donors have noticed that even as he increased his TV appearances, he is still struggling in the polls.
These donors are privately acknowledging that Sanders has become the front-runner in the race. They are starting to believe the only candidate who can beat him in the Democratic primary is Bloomberg as he is worth about $60 billion. Biden, meanwhile, struggled to raise campaign cash coming into this year. In the fourth quarter, he finished with $8.8 million on hand, behind rivals Sanders, former South Bend, Indiana, Mayor Pete Buttigieg and Sen. Elizabeth Warren.
An NBC News/ Wall Street Journal survey released this week shows Sanders ahead of the rest of the field with 27% of the vote. Since last month, though, Biden dropped 11 points to second place with 15% and Bloomberg has surged into third with 14% of support. All three will be facing off Wednesday night in Nevada for Bloomberg's first presidential debate. There are some Biden financial supporters who are planning on reaching a final decision about moving over to Bloomberg after the debate, making the former vice president's performance Wednesday even more important.
Another key figure in Biden's network, Brad Karp, chairman of law firm Paul, Weiss, Rifkind, Wharton & Garrison, is telling associates he will likely jump over to Bloomberg, these people added. Karp is listed by the campaign as one of Biden's bundlers.
The financiers moving from Biden to Bloomberg also understand they won't have to shell out money or hold fundraisers to directly support the former New York mayor's campaign. Bloomberg's business surrogates who are on the "Committee for Mike" have only been asked to encourage their networks to vote for him, appear at events and potentially attend briefings with Bloomberg himself.
Several financial executives who have been helping Biden have also started to meet with and reach out to the Bloomberg campaign to get a feel for the operation.
"Bloomberg is running a great campaign, hiring incredible people and building an impressive field operation across the country," said a Wall Street Biden supporter who recently met with Bloomberg but declined to be named. "Also spending essentially unlimited money and we're seeing all of that result in an impressive increase in the polls."
Another investor noted that Biden's backers are preparing to move toward Bloomberg if the former vice president doesn't score a dominant win in the Feb. 29 South Carolina primary. Biden has been the polling leader in the state for much of the campaign, and his organization has projected confidence in his strength there. The candidate left New Hampshire early the day of the primary to rally in South Carolina.
"I think everyone will move over after South Carolina," this lead Biden fundraiser said.
Representatives for Biden and Bloomberg did not return a request for comment. Henes and Karp also did not return calls for comment.
Beyond the battle for prominent behind-the-scenes supporters, Bloomberg and Biden are on a collision course in the Wednesday debate.
Biden has started calling for more scrutiny of Bloomberg's record as mayor of New York, with a particular focus on the controversial stop-and-frisk policy. It allowed the New York Police Department to randomly stop, search and frisk people. People in black and Latino communities were most routinely targeted. Bloomberg apologized for the policy before he announced his presidential run.
Bloomberg's campaign, meanwhile, has started to paint Biden as someone who lost his footing after a strong start to the campaign. During a briefing with reporters on Tuesday, Bloomberg strategist Dan Kanninen said they only see Sanders as the only Democrat who could get in their way to the nomination.
Bloomberg and Biden continued taking jabs at each other through digital ads on the day of the debate.