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How Larry Fink Rose Through The Shadows To Wall Street Fame
BlackRock CEO Larry Fink is the kind of guy people in the financial industry never stop buzzing about.
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Most recently, he's generated buzz for BlackRock's new trading platform to connect buyers and sellers of bonds directly that many say could make Wall Street obsolete. Just last week, BlackRock announced a profit for its first quarter for 2012, not to mention the investment managing firm is always making headlines for being the biggest money manager in the world with over $3 trillion AUM.
But to get to his current stardom, Fink has walked a path in the shadows. Before the financial crisis, few had heard of the executive. Now, he's on top.
The California native has two degrees from UCLA's undergraduate program and business school, and once described himself as "just an L.A. kid" that showed on Wall Street with "turquoise jewelry and long hair"
He started his Wall Street career on a trading desk at First Boston in the 70s. He was soon put in charge of a division that oversaw mortgage-backed securities (then a nearly-unknown industry).
Source: Vanity Fair
Many may think of Lewis Ranieri—of Liar's Poker fame—to be the mastermind behind the subprime mortgage market. But Fink was also at the helm of the development of this market along with Ranieri. In fact, Fink was very competitive over the number of deals that First Boston did versus Salomon Brothers.
At one point, it was estimated he added $1 billion to First Boston's bottom line.
Source: Vanity Fair
After a bad bet on interest rates in the late 80s, Fink's department at First Boston lost $100 million. Suddenly, as fast as he became a rising star, he was just as quickly ousted from the limelight. When Fink finally left the firm in 1988, First Boston made it very public knowledge that they had essentially fired him. Burn.
Source: Vanity Fair
Despite his big embarrassing departure from First Boston, Fink jumped right into a new project—starting BlackRock with fellow First Boston c-worker Robert Kapito.
The company spun off now-famed private equity firm Blackstone.
BlackRock now manages $3.5 trillion. He still leads the company, which is now the biggest money manager in the world.
Source: Vanity Fair, DealBook
Although he's worth over $23 million and has a house on the Upper East Side, Fink doesn't run in New York social circles—so sometimes when his name is brought up, people still don't recognize him.
Rather, his hobbies include fly fishing and skiing, and he's particular to folk art and a bit of a foodie.
Source: Vanity Fair
And not just on Wall Street, in Washington too.
Source: Vanity Fair
He pulled off a successful $13.5 billion acquisition of Barclays Global Investors at the height of the crisis, gaining admiration and respect from the rest of Wall Street. It started in 2008 and finished in 2010 — when no one was doing any deals.
The deal made BlackRock the largest money manager in the world.
Source: Vanity Fair
The firm started managing $130 billion of the toxic assets the government purchased during the subprime crisis.
Source: Vanity Fair
In case you needed reminding on the business card incident:
A young Wall Streeter once chatted with Fink at an event, and when Fink indicated he had to leave but wanted to continue the conversation, the young man asked Fink if he had a business card.
Fink replied: "I don't have a card."
Source: CNBC
Fink's compensation in 2010 was $23.65 million. That beat out Jamie Dimon, Lloyd Blankfein, Brian Moynihan, James Gorman, Vikram Pandit, and basically anyone else that matters in banking.
Might be time to get into money managing?
Source: WSJ
With news that Tim Geithner won't stay around for a second term if Obama is re-elected, everyone's buzzing about Fink being a possible replacement for the Treasury Secretary.
Even though Fink has told the media that he doesn't have the skills to do the job, people still want him in the post. CNBC's Maria Bartiromo once even said Fink is her first choice to get Geithner's job.
Source: CNBC, BI
In an interview with Bloomberg last year, Fink said:
"I'm actually very happy with Occupy Wall Street because I think that actually for the first time in 3 years we may have fringe element symmetry...
"We have to admit, as members of the financial press and the financial community...Washington...we really did let down a lot of people... To resolve this we have to admit it."
Source: BI
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