Larry Fink lost $100 million, Got Fired, and then started BlackRock

@gritcapital

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Why it worked

The video uses a compelling narrative of failure and redemption, highlighting a significant financial loss and the subsequent success of a major company. This 'rags to riches' or 'failure to triumph' story is inherently engaging and relatable, drawing viewers in with the promise of learning from a prominent figure's mistakes and successes.

Summary

Larry Fink recounts his early career, detailing how he lost $100 million due to inadequate risk management despite making a lot of money. He reflects on this experience, noting that the firm's lack of risk analytics led to him being given more capital, ultimately resulting in the significant loss.

Structure

1Early career success and rapid advancement
2Realization of inadequate risk controls despite high profits
3Significant financial loss due to poor risk management
4Reflection on the mistake and its consequences

Product placement

BlackRock is mentioned as the company Larry Fink started after losing $100 million. The video also shows a screen displaying "GRIT" and promoting a newsletter about stocks, crypto, and finance with a "LINK IN BIO" call to action.

Call to action

LINK IN BIO!

On-screen text

Larry Fink lost $100 million, Got Fired, and then started BlackRock How Larry Fink turned a $100M loss into BlackRock's $10T empire. GRIT

Original caption

One mistake. $100 million lost. Instead of giving up, Larry Fink built BlackRock with a laser focus on risk management. #LarryFink #BlackRock #WallStreet #StockMarket

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Transcript

I started at 23 uh right out of grad school. Uh at 27 I became the youngest managing director in the firm's history. At 31 I was on the executive committee of the firm. Um and at 34 I was a jerk. You know the journey was we were making lots of money. It was just it was crazy times. We were making so much money, but we had really inadequate risk controls. We had inadequate knowledge of how we were the risk we were taking in in making all that money. And I could look back and said we probably should have been fired for making too much money because the amount of risk we were taking to make that type of money was probably not a great risk reward but because there's no risk analytics, the firm actually gave me more capital to put more money to work and then obviously in uh 1986 in the second quarter after record first quarter we lost a 100 million dollars and then the firm woke up to the amount of risk we were taking that today a 100 million is not that big of loss back then there was a lot of money to lose and I actually Peter never forgave myself.