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BlackRock Founders: History and Origins of the Asset Management Giant
Blackrock was founded by Larry Fink , Robert Kapito , Susan Wagner , Barbara Novick , Ben Golub , Ralph Schlosstein , Hugh Frater and Keith Anderson in 1988.
Blackrock is now recognized as the world's largest asset manager, with $11.475 trillion in assets under management as of September 30, 2024 , according to official figures published by the company. This equates to approximately 10% of the global market capitalization, estimated at around $115 trillion , representing an unprecedented concentration of financial power in the history of the markets.
By comparison, its direct competitors lag far behind: Vanguard manages approximately $ 7.8 trillion in assets, while Fidelity is around $4.5 trillion . This dominance places BlackRock in a systemic position globally, often described by analysts as an "invisible manager" or a "parallel state" due to its extensive influence on financial flows, the decisions of listed companies, and even certain public policies.
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Blackrock founders: A massive footprint in global businesses
According to a study published by the Federal Reserve in 2020 , BlackRock held significant stakes in more than 95% of the companies comprising the S&P 500 index . Through its funds, iShares ETFs, and management mandates, the company has shares in firms such as Apple , Microsoft , ExxonMobil , JPMorgan Chase , and Alphabet .
Its equity stakes regularly exceed 5%, the threshold triggering regulatory reporting obligations. Such positions give BlackRock considerable voting power at the general meetings of large listed companies, a power further strengthened by the rise of passive index funds.
Blackrock founders: A quasi-institutional role
BlackRock does not act solely as an investor. The company is also a provider of technology services and strategic advice to public institutions. Its risk management software, Aladdin (Asset, Liability, and Debt and Derivatives Investment Network), currently oversees approximately $21.6 trillion in assets worldwide, including those of third-party institutions such as BNP Paribas , Allianz , and certain banks.
BlackRock was also mandated by the US Federal Reserve to purchase corporate bonds as part of the Covid-19 emergency measures in 2020, just as it had already played a key role in managing assets post-subprime crisis in 2008.
Blackrock founders: Beginnings marked by risk management
To better understand this influence, we must go back to the company's creation. Founded in 1988 as Blackstone Financial Management , the company was born from the vision of eight founders , former employees of First Boston and Lehman Brothers. Among them, Larry Fink , now CEO, was the principal architect of its strategy. He was joined by, among others, Robert Kapito (current chairman), Barbara Novik , Susan Wagner , and Keith Anderson .
In the 1980s, most asset managers focused primarily on financial performance without always accurately measuring the risks involved. The founders of Blackrock wanted to place risk at the heart of every investment decision , using techniques borrowed from bond markets, where modeling is essential.
BlackRock has been focusing on transparency and technology from the outset to better understand risks.
This is how the company developed Aladdin , a proprietary computer system designed to analyze investment portfolios in detail. Thanks to Aladdin, BlackRock can:
- To monitor in real time what is happening in all the portfolios she manages.
- Test different market scenarios to anticipate potential losses.
- Verify that risk levels remain within the limits defined with clients.
This approach quickly appealed to large institutional investors , such as banks, insurance companies or pension funds, who found it to offer more rigorous and transparent management than other competitors.
Blackrock founders: A rise to power accelerated by acquisitions
In 1995, PNC Financial Services Group acquired a majority stake in BlackRock , investing approximately $240 million . Unlike a typical acquisition, this transaction granted BlackRock significant operational autonomy under the leadership of Larry Fink. PNC acted as a strategic shareholder, while allowing the fledgling firm to continue its growth in asset management.
Over the years, BlackRock has made a series of targeted acquisitions: in 2004, it acquired State Street Research & Management , then in 2006, Merrill Lynch Investment Managers , which strengthened its global presence and institutional clientele.
The real turning point came in 2009 with the acquisition of Barclays Global Investors (BGI ), including the highly popular ETF platform iShares, for $13.5 billion. This transaction immediately doubled BlackRock , from $1.3 trillion to nearly $2.8 trillion, and propelled it to the rank of the world's largest asset manager.
In parallel, PNC began selling its stake in BlackRock , eventually selling its entire holding (approximately 22.4%) in 2020 , realizing a significant capital gain of over $14 billion. This exit marked the end of a partnership during which BlackRock built its global dominance.
Blackrock and its position on cryptocurrencies
Over the years, BlackRock has adopted a gradual and evolving approach to digital assets, particularly Bitcoin. For a long time, the company maintained a cautious stance, highlighting the risks of volatility, lack of clear regulation, and transparency issues in crypto markets.
In 2018, its CEO Larry Fink stated that he saw "no serious demand" from institutional clients for Bitcoin-related investment products, even though he emphasized the potential of blockchain . At that time, the market remained marginal in the portfolios of large investors, and the regulatory framework in the United States was still unclear.
However, as the cryptocurrency sector has become more structured — with the emergence of derivatives, institutional custody, and increased demand from professional investors — BlackRock has gradually integrated these assets into its field of analysis.
From 2020 onwards, the company authorized some of its funds to invest in Bitcoin futures listed on the CME , and increased its public stances on the growing importance of asset tokenization, considered a major evolution of the financial system.
The significant turning point came in June 2023, when BlackRock Bitcoin officially filed a spot Bitcoin ETF application with the SEC. This event marked a clear recognition of the legitimacy of these assets within a traditional investment offering, subject to regulatory compliance. The filing of this ETF had a significant impact on the market, with an immediate rise in the price of Bitcoin at the time, reflecting expectations related to the institutionalization of the sector.
In parallel, BlackRock is also interested in the broader Web3 . In 2024, the company announced the launch of the BlackRock USD Institutional Digital Liquidity Fund (BUIDL) , a tokenized fund operating on the public Ethereum , allowing investors to receive returns in USD in a programmable and transparent manner. This fund, reserved for accredited investors, is integrated with Coinbase Custody for asset custody, highlighting the strategic alignment between BlackRock and established crypto infrastructures.
Summary of BlackRock 's concrete initiatives in cryptocurrencies:
- 2020: Authorization to invest in Bitcoin futures for certain funds.
- 2022: Integration of Bitcoin Trust into certain customer wallets via Coinbase Prime.
- 2023: Filing of a spot with the SEC, in collaboration with Coinbase .
- 2024: Launch of the BUIDL tokenized fund on Ethereum.
Today, BlackRock does not position itself as an activist player in the crypto sector, but as an asset manager that follows (and dictates?) market dynamics and offers different products.
Blackrock : A controversial player at the heart of power struggles
BlackRock's power, managing nearly $11.5 trillion in assets as of September 30, 2024, continues to draw sharp criticism. The concentration of such financial power in the hands of a single private entity is a source of concern for a segment of civil society, economists specializing in systemic risk, and several political leaders.
Many analysts point to a systemic risk, particularly in the event of a global financial crisis. Its positions give it an influence that far exceeds that of most governments. Such omnipresence raises concerns about the true independence of markets and potential interference in national economic policies.
BlackRock 's repeated mandates by governments—notably in the United States during the COVID-19 crisis and in Europe as part of stimulus packages—raise questions. This dual role, acting as both a public advisor and a private investor, begs the question: how can the neutrality of its political recommendations be guaranteed when the sectors it advises are often the same as those in which the firm has significant investments?
Blackrock, its impact and its founders: Conclusion
Starting with a group of eight founders in 1988, including Larry Fink and Robert Kapito , BlackRock has gradually transformed into an indispensable infrastructure of global finance . Their initial vision – to combine risk management and technology in the world of investment – has shaped a company that no longer simply manages portfolios.
Today, BlackRock plays multiple roles: key shareholder in thousands of companies , advisor to governments , manager of public and private assets , and also provider of technological tools through its Aladdin platform. This unprecedented position of power raises increasing questions about the nature and extent of its influence within the workings of contemporary capitalism. At the root of this rise are deliberate strategic choices… but also a series of decisions where the line between private and public interest sometimes becomes blurred .
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Yoann
Training engineer, I quickly became interested in the field of finance. Convinced that decentralized finance has a bright future ahead of it, I participate in its democratization by developing Crypternon.
