#253 Henry Goldman (Goldman Sachs)

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Jun 22, 2022

Explore the fascinating origins of Goldman Sachs, tracing the legacy of Marcus and Henry Goldman. Discover how personal struggles and family dynamics shaped their journey in the banking industry. Learn about early retail innovation through figures like Woolworths, and the bold strategies that redefined commerce. Henry shares his reflections on life, legacy, and the importance of living fully while acknowledging the transient nature of success and personal connections.

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ANECDOTE

Weinberg's Rise

Sidney Weinberg began at Goldman Sachs as a janitor's assistant, rising to partner.
Henry Goldman mentored Weinberg, showcasing his ability to spot potential.

INSIGHT

Underestimated Henry

Henry Goldman's reading difficulty, later attributed to astigmatism, led to him being underestimated.
This fueled his desire to prove others wrong, leveraging listening as a strength.

INSIGHT

Immigrant Opportunity

Marcus Goldman saw opportunity in the influx of immigrants, not competition.
Starting a tailoring business with a $5 loan exemplified his entrepreneurial spirit.

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Levi Strauss

The Man Who Gave Blue Jeans to the World

Lynn Downey

This book by Lynn Downey delves into the life of Levi Strauss, a Jewish immigrant from Bavaria who became a leading businessman in San Francisco. It explores his entrepreneurial journey, his partnership with Jacob Davis to produce riveted denim pants, and his contributions to San Francisco's society. Despite the loss of personal documents in the 1906 San Francisco fire, Downey uses historical records to paint a detailed picture of Strauss's life and legacy.

Last Train to Paradise

Henry Flagler and the Spectacular Rise and Fall of the Railroad that Crossed an Ocean

Les Standiford

This book chronicles the extraordinary story of the construction and operation of the railroad from Miami to Key West, often referred to as 'Flagler’s Folly'. It details the engineering challenges, the personal struggles of Henry Flagler, and the impact of the railroad on Florida and Key West. The narrative also includes a gripping account of the devastating 1935 hurricane that destroyed much of the railroad. The book blends historical facts with engaging storytelling, capturing the era and the characters involved in this monumental engineering feat.

Founder

Amos Elon

This book provides a detailed portrait of Meyer Amschel Rothschild, who rose from humble beginnings in the Frankfurt ghetto to become a leading financier in Europe. It explores not only his life but also the societal context of his time, including the challenges faced by Jews in Germany and the emergence of modern capitalism. The book offers insights into Rothschild's innovative business strategies and his role in shaping European finance.

Risk Game

Francis Greenburger

When money was in fashion

June Breton Fisher

This book tells the story of Henry Goldman, a pivotal figure in the development of modern investment banking. It explores his career at Goldman Sachs, his contributions to financial history, including making Sears, Roebuck Co. the first publicly owned retail operation, and his complex relationships with influential figures like Albert Einstein. The narrative delves into the challenges faced by Henry Goldman, including his support for Germany during World War I and his later denunciation of Hitler's atrocities.

Titan

The Life of John D. Rockefeller, Sr.

Ron Chernow

This biography by Ron Chernow provides an in-depth look at John D. Rockefeller, Sr., the founder of Standard Oil and one of the most influential figures in American history. Drawing on unprecedented access to Rockefeller’s private papers, Chernow reconstructs Rockefeller’s troubled origins, his single-minded pursuit of wealth, and his profound religiosity. The book also delves into Rockefeller’s philanthropic efforts, including his generous donations to the Rockefeller Foundation, the University of Chicago, and Rockefeller University. Chernow’s narrative synthesizes Rockefeller’s public and private lives, revealing a complex and multifaceted individual who was both a ruthless businessman and a devoted philanthropist. The book captures a pivotal moment in American history, documenting the post-Civil War shift from small businesses to giant corporations and featuring cameos by notable figures such as Ida Tarbell, Andrew Carnegie, and J.P. Morgan.

The House of Rothschild

Volume 1: Money's Prophets, 1798-1848

Niall Ferguson

In this meticulously researched volume, Niall Ferguson explores the early history of the Rothschild family, detailing their ascent from the Frankfurt ghetto to become one of the most influential financial dynasties in Europe. The book delves into their strategic use of financial instruments and their extensive political networks, which enabled them to dominate international finance during the 19th century.

Confessions of an Advertising Man

David Ogilvy

First published in 1963, this book revolutionized the world of advertising and became a bible for the 1960s ad generation. It covers topics such as how to manage an advertising agency, acquire and retain clients, build great campaigns, write potent copy, and navigate office politics. The book is filled with Ogilvy's pioneering ideas, inspirational philosophy, and practical advice, making it an essential blueprint for good practice in business.

The Chief

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Michael Jordan: The Life

Roland Lazenby

This biography, written by Roland Lazenby, delves into the life of Michael Jordan, from his early days in North Carolina to his rise as a global ambassador for basketball. It covers his growth from a skinny rookie to a legendary player and business icon, highlighting his ruthless competitiveness and insatiable drive. The book draws on Lazenby's personal relationships with Jordan's coaches, friends, teammates, and family members, as well as interviews with Jordan himself, to provide a detailed and compelling portrait of the man behind the myth.

The Uses of Adversity

Essays on the Fate of Central Europe

Timothy Garton Ash

Timothy Garton Ash's "The Uses of Adversity" is a work of history and political philosophy that explores the challenges and opportunities presented by difficult times. Ash examines various historical periods and political systems, analyzing how societies have responded to adversity. He argues that adversity can be a catalyst for change and innovation, leading to both positive and negative outcomes. Ash's work is characterized by its intellectual depth and its commitment to historical accuracy. The book offers valuable insights into the complexities of political and social change.

What I learned from reading When Money Was In Fashion: Henry Goldman, Goldman Sachs, and the Founding of Wall Street by June Breton Fisher.

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[2:30] The Uses of Adversity by Malcolm Gladwell

[2:40] Business Breakdowns: Goldman Sachs: Fortune Favors The Old

[3:00] Men can learn from the past, and I've been shocked how little some of the younger executives in the present firm know about its origins. They don't even know that my grandfather, whose picture is on the wall there, founded the firm.

[3:46] My grandfather, Henry Goldman, was the son of a poor German immigrant named Marcus Goldman. Marcus Goldman is the founder of Goldman Sachs.

[5:45] Levi Strauss: The Man Who Gave Blue Jeans to the World by Lynn Downey (Founders #33)

[7:10] The job Marcus Goldman was grateful to have: Walking the streets peddling goods seven days a week. Working regardless of rain, or snow, or the humid summer heat.

[9:13] Henry had been slow learning to read. It was finally determined that the youngster suffered from astigmatism, and his chores in the shop were limited to fetching and carrying articles from the storeroom or fastening the shutters at closing time. His mother was convinced he would never succeed in a competitive world and was inclined to coddle and baby him. (The “slow learner” is the one that fuels much of Goldman Sachs growth!)

[12:03] At the time no qualifications or special training were needed to enter the banking business.

[13:36] Marcus was anxious to capitalize on every waking hour.

[14:19] Henry was an attentive listener who committed everything he heard to memory.

[18:40] Successful people listen. Those who don’t listen, don’t survive long. — Michael Jordan: The Life by Roland Lazenby (Founders #212)

[25:12] This part about the Railroads reminded me of the Internet: As new businesses started up every day and the distribution of their goods was being revolutionized by the rapid spider webbing of railroads across the country, Henry was itching to get into the action.

[26:05] Goldman Sachs partners with Kleinwort Sons & Co

[27:36] Founder: A Portrait of the First Rothschild by Amos Elon. (Founders #197) and The House of Rothschild: Money's Prophets by Niall Ferguson. (Founders #198)

[30:01] David Ogilvy’s idea that The Good Ones Know More: First, you must be ambitious. Set yourself to becoming the best-informed man in the agency on the account to which you are assigned. If, for example, it is a gasoline account, read text books on the chemistry, geology and distribution of petroleum products. Read all the trade journals in the field. Read all the research reports and marketing plans that your agency has ever written on the product.

Spend Saturday mornings in service stations, pumping gasoline and talking to motorists. Visit your client's refineries and research laboratories. Study the advertising of his competitors. At the end of your second year, you will know more about gasoline than your boss; you will then be ready to succeed him. Most of the young men in agencies are too lazy to do this kind of homework. They remain permanently superficial. — Confessions of an Advertising Man by David Ogilvy. (Founders #89)

[30:23] The best talk on YouTube: Runnin' Down a Dream: How to Succeed and Thrive in a Career You Love by Bill Gurley

[32:28] Jacob Schiff was fascinated by railroad development in all its ramifications and became determined that his firm would dominate the field. There was not a facet of railroad investment or operation that he did not carry in his head.

[34:30] Learn more about Standard Oil: Last Train to Paradise: Henry Flagler and the Spectacular Rise and Fall of the Railroad that Crossed an Ocean by Les Standiford. (Founders #247) Titan: The Life of John D. Rockefeller by Ron Chernow. (Founders #248)

[39:18] Markets can turn on a dime. —Risk Game: Self Portrait of an Entrepreneur by Francis Greenburger (Founders #243)

[40:12] The greatest entrepreneurs that have ever lived optimized for survival.

[44:22] Henry’s motto: Money is always in fashion.

[45:08] The Chief: The Life of William Randolph Hearst by David Nasaw. (Founders #145)

[54:00] But he held no sympathy for them. They had relied on the decisions of others, which he himself would never have done.

[54:13] Henry shared the regret that he had never developed greater rapport with his children. He thought of his inability to “noodle" with them, to express approval, to overlook their minor slips, to embrace them and say, “I love you.”

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