First Boston

This week's guest is a special one, a true legend in finance.

This gent went to Wharton undergrad and then started at First Boston, one of the predecessor firms to erstwhile Credit Suisse, working in the then nascent mortgage-backed securities market.

After an MBA at Harvard Business School, he returned to First Boston, but eventually he and several colleagues, including one Larry Fink, left in nineteen eighty-eight to become co-founders and partners of BlackRock, originally part of the asset management firm Blackstone.

In nineteen ninety-two, BlackRock spun out as an independent entity and went public in nineteen ninety-nine with then around a hundred and sixty-five billion of assets under management.

Under this gentleman's stewardship, BlackRock has grown organically and through acquisition to be now the leading asset management firm on the planet, with over fifteen trillion in assets under management today.

Mm.

And I loved getting a dividend, and we'd always talk about the stock market, but it piqued my interest.

You graduate, and you start at First Boston in what was then called the Public Finance Department.

when the idea of providing capital to your clients was not really a thing.

And the irony, of course, is that Bruce Wasserstein at First Boston made it a thing.

And I see you have the book, Big Deal.

He made it a thing.

So here's what they did.

They went to First Boston at that time, the leading M&A bank on the street.

And they said, we have $660 million to spend.

Can you find us a target? This is like walking to Bloomingdale's with $5,000 in cash, waving around saying, can you help me spend this money? I really need to spend it.

You'll be surrounded by salespeople working on commissions trying to get you to buy stuff, right? So guess what first Boston said? No problem.

We'll find the perfect target for you.

And they came back with the perfect target, which coincidentally, They could buy for exactly $60 million.

Here's one of the first rules in acquisitions.

It was bust.

I was working for First Boston and we did the underwriting for the Westpac emergency rights issue.

I don't want to talk about it, but it was bust.

It needed an emergency capital raising.

Oh, my goodness.

Russ, Bill Woodfield, First Boston Group.

I think we can help you with your deal by taking advantage of certain tax loopholes you may not be aware of.

Give me

It's about the cash flow.

Amen.

First Boston.

He had another set of bankers.