The Untold Story Of World’s Largest Asset Manager-BlackRock

KEY TAKEAWAYS

1. BlackRock, the world's largest asset manager with over $10 trillion in AUM, has partnered with Jio Financial Services to launch a mutual fund business in India, combining BlackRock's investment expertise with Jio's digital reach.

2. BlackRock was founded in 1988 by eight co-founders and has grown from a small bond shop to a global asset management giant, achieving key milestones and acquisitions over the decades.

3. BlackRock's notable acquisitions and expansions include the development of the Aladdin platform, international growth, and a focus on private markets and sustainability offerings.

4. BlackRock's 'frenemy' BlackStone is the largest alternative investments manager, with a history of collaboration and eventual separation from BlackRock, leading to a significant rivalry.

5. The joint venture with Jio Financial Services aims to leverage BlackRock's Aladdin platform in India, potentially transforming the investment landscape and expanding BlackRock's presence in alternative investments.

---

In a big move last month, India’s market regulator SEBI gave a green signal to Jio BlackRock Asset Management, a 50:50 joint venture between Jio Financial Services (JFSL) and BlackRock, to commence operations as an investment manager for their mutual fund business in India.

This approval by SEBI comes around two years after this mega joint venture between Jio and BlackRock was announced in July 2023, and had since then been the talk of the town.

But why is it such a big deal? Well, firstly, BlackRock is the world's biggest asset manager, handling an AUM (Assets Under Management) of over $10 trillion. Yes, that number in itself is bigger than the size of most countries’ economies, right?

As far as Jio Financial Services is concerned, it had already begun offering a wide range of services including loans, savings accounts, UPI bill payments, recharges, digital insurance, etc. before entering into this joint venture. Originally launched as a subsidiary of Reliance Industries, Jio Financial Services got demerged as an independent entity and then eventually listed on the Indian stock exchanges in August 2023.

So, all in all, both of these powerhouses are aiming to combine each other’s strengths (BlackRock's deep investment expertise and Jio Finance’s digital reach), to bridge the gap between technology and finance through their mutual fund.

Nonetheless, in this blog of ours, we bring to you the untold story of the world's biggest asset manager-BlackRock.

From A Small Bond Shop To World’s Biggest Asset Manager

BlackRock was founded by not one, two or three, but in fact eight people. Its eight co-founders started the firm in New York in 1988, initially as a small bond shop (as it describes itself at that time) which engaged in enterprise risk management and fixed income institutional asset management.

Here’s the list of BlackRock’s 8 co-founders:

1. Robert Kapito

2. Keith Anderson

3. Susan Wagner

4. Hugh Frater

5. Ben Golub

6. Larry Fink

7. Ralph Schlosstein

8. Barbara Novick

Top row: Robert Kapito, Keith Anderson, Susan Wagner, Hugh Frater, Ben Golub

Bottom row: Larry Fink, Ralph Schlosstein, Barbara Novick

Timeline Of BlackRock’s Key Moments Since Inception:

1980's

During its early years, BlackRock hit these key milestones:

• Launched innovative products, beginning with an ‘Income Trust’

• Took its first advisory assignment

• Developed the Aladdin platform to manage portfolios and risk

1990's

The year 1999 marked a big moment for BlackRock, as it got listed on the New York Stock Exchange and had $165 billion in AUM, as of December 31, 1999. This era was marked the following highlights:

• Offered Aladdin capabilities to clients

• Launched the first target date fund

• Combined with PNC, adding cash management, open-end equity mutual funds and a distribution network

• Expanded outside of the U.S. with an office in Edinburgh

2000's

This decade of the 21st century was about rounding out the platform through landmark acquisitions:

• State Street Research & Management accelerated equities capabilities

• Merrill Lynch Investment Managers extended retail distribution and international presence

• Quellos Group added alternative investment expertise

• Barclays Global Investors brought iShares ETFs and systematic investing capabilities into its platform

• R3 Capital Management added absolute return and alternative fixed-income solutions

• This period was also defined by governments around the world calling on BlackRock and its risk capabilities to help them navigate the financial crisis

2010's

In these relatively more recent years, BlackRock’s focus was to further expand investor choice, and build a platform for the whole portfolio.

• Drove long-term value through investment stewardship

• Expanded its private markets and sustainability offerings

• Key acquisitions of First Reserve Energy Infrastructure Funds – infrastructure investing, Cachematrix fintech made its cash business stronger, Tennenbaum Capital Partners broadened capabilities in private credit and eFront brought Private Markets to Aladdin.

The Present

BlackRock currently holds over $10 trillion in AUM, and a workforce of nearly 20,000 employees in over 30 countries. The key highlights from its recent years, include:

• Aperio expanded its ability to personalize portfolios

• Its combination with Global Infrastructure Partners created a premier infrastructure investment platform

• The comprehensive private markets data set of Preqin enhanced Aladdin and eFront, and helped make private markets more transparent and investable

• With the private debt capabilities of HPS Investment Partners, we will provide clients with both public and private income solutions when that transaction closes

Not BlackRock, This ‘Frenemy’ Is The World’s Biggest Alternative Investments Manager

While BlackRock is undoubtedly the world’s largest asset manager, it does not hold this crown in the alternative investments space.

The leader in this segment is its ‘frenemy’ BlackStone, with more than $1 trillion of AUM in the alternative investment industry (as of December 2024). BlackStone was founded in 1985 by Peter G. Peterson and Stephen A. Schwarzman, originally aimed to be a mergers and acquisitions advisory firm. The next few years went on to see a ‘friends turned foes’ story that is still considered to be the greatest ‘Frenemy’ (friend who turned into a enemy) story in the US stock market till date. Let’s unfold that for you.

BlackRock Vs BlackStone: The Greatest Wall Street Frenemy Story

There’s an interesting spin to the BlackRock-BlackStone story. BlackRock, which was founded in 1988 by its eight co-founders Larry Fink, Robert S. Kapito, Susan Wagner, Barbara Novick, Ben Golub, Hugh Frater, Ralph Schlosstein, and Keith Anderson. Four of these- Fink, Kapito, Golub and Novick, had worked together at First Boston, an investment bank, where Fink and his team were seen as pioneers in the mortgage-backed securities market in the US. During Fink's tenure, he had unfortunately lost $90 million due to a miscalculation in the mortgage-backed securities market. That experience turned to be a motivation to co-found BlackRock, with a focus on risk management, which became a key differentiator for the asset manager till date.

Initially, Fink sought an initial funding from BlackStone group’s Peter Peterson, who believed in Fink's vision. Peterson called it Blackstone Financial Management. In exchange for a 50% stake in the bond business, Blackstone initially gave Fink and his team a $5 million credit line. And within just a few months, the business had turned profitable, and by 1989 the group's assets had quadrupled to $2.7 billion. The percent of the stake owned by BlackStone also fell to 40%, and by 1992, it had a stake equating to about 36% of the company, and Stephen A. Schwarzman and Fink were considering selling shares to the public. The firm went on to adopt the name BlackRock in 1992.

Then came the twist in the tale, when Schwarzman and Fink had an internal dispute over methods of compensation and equity, in 1994. Fink wanted to share equity with new hires, whereas Schwarzman did not want to further lower Blackstone's stake. Both of them agreed to part ways, and Schwarzman sold BlackRock, a decision he later called a "heroic mistake." Schwarzman remained with Blackstone, while Fink remained the chairman and CEO of BlackRock, a position he holds till date. Little did Schwarzman know that what he had sold at that time would go on to become the world’s largest asset manager.

What BlackRock’s Latest Financial Report 2025 Says

Earlier this year in January 2025, BlackRock had released its financial results for the three months and year ended December 31, 2024. It had reported a mammoth $11.6 trillion in AUM, including alternative investments of over $400 billion.

You can check out BlackRock’s detailed report and financials by clicking here.

Why Is BlackRock Now Shifting More Towards The Alternative Investments Industry?

Besides being the largest asset manager in the world, Blackrock (quite expectedly) also has a solid portfolio of over $400 billion as an alternative assets manager. And this seems to be just the beginning, as the firm is believed to be deepening its push into alternative assets, given the rising investor demand for investments that offer diversification beyond traditional and volatile equity markets.

In fact, it is expected that the world’s largest asset manager’s total AUM can hit the $12.2 trillion mark in 2025, with alternative investments set to deliver the fastest growth, rising +54% year-on-year.

When Will Jio-BlackRock Launch Its Mutual Funds Schemes?

Coming back to the recent developments in BlackRock’s mega joint venture with Jio Financial Services, the draft documents for three schemes have already been filed with SEBI. In another landmark move, Jio last week launched BlackRock’s unique investment analytics and risk management platform Aladdin, in India.

Here, its important to lay some emphasis on Aladdin (an acronym for Asset, Liability, Debt and Derivative Investment Network). It is a comprehensive investment management and trading platform which was launched by BlackRock in 1988. Used by thousands of organizations, including Accenture, Ernst & Young, Microsoft, Wells Fargo, Morgan Stanley, etc., Aladdin is a powerful and unified platform that combines sophisticated risk analytics with comprehensive portfolio management, trading and operations tools.

And now, BlackRock and Jio Financial Services have together brought this powerful tool to India, for the first time, through Jio BlackRock Mutual Fund. Now it remains to be seen how this mega joint venture continues its efforts to become a game changer in India’s investments industry. We all will have to wait and watch how all of this unfolds!

Conclusion

In conclusion, BlackRock's journey from a small bond shop to the world's largest asset manager is a testament to its strategic vision and adaptability. The company's focus on risk management, innovative acquisitions, and global expansion has solidified its position in the financial industry. The recent joint venture with Jio Financial Services marks a significant step in bridging technology and finance, potentially transforming the investment landscape in India. As BlackRock continues to expand its presence in alternative investments, it remains a key player in shaping the future of global asset management. The unfolding story of BlackRock and its ventures, like the one with Jio Financial Services, will be crucial to watch as they aim to redefine investment strategies and opportunities worldwide.

---

Please note that this is an opinion blog and not an official research or investment advice. This blog aims to educate investors about BlackRock’s story, and neither encourages nor discourages you from investing in any particular platform or any other asset class.

---