Home Amazing Business Stories Amazing Business Story: Michael Rubens Bloomberg

Amazing Business Story: Michael Rubens Bloomberg

by

Michael Rubens Bloomberg was born on the 14th of February, 1942 to a Jewish father, William Henry Bloomberg, who was a bookkeeper at a local diary and mother, Charlotte Rubens Bloomberg, who worked as a secretary.

Bloomberg attended John Hopkins University where he graduated in 1964 with a degree in Electrical Electronics. He then attended Harvard Business School where he earned his Master in Business Administration (MBA) in 1966. That same year, during the height of the Vietnam war, Bloomberg applied to Officer Candidate School of the US Armed Forces, but was rejected for having flat feet.

Bloomberg then took an entry level job at Salomon Brothers Investment bank where he worked in the uninhabitable bank value, 12 hours every day six days every week, in his underwears. His starting salary at Salomon was $9,000 per year.

Through sheer tenacity and determination, Bloomberg was able to work his way up the ladder becoming partner at the bank by 1972. In 1976 he was made a general partner and served as head of equity trading and sales; a very juicy position.

In 1979, John Gutfreund; the CEO of Salomon Brothers, asked Bloomberg to leave his postion as head of equity trading and sales to head the young and emerging computer system area. Bloomberg was not happy about the move, because it appeared like a demotion, but in the long run it turned out to be for the best.

In 1981, things changed. Salomon was acquired by the publicly traded commodity trading firm Phibro Corporation. It was a thing of celebration for the partners at the bank as most of them would become wealthy as a result of the acquisition.

On August 1, 1981, the day after the announcement of the acquisition, Bloomberg and a handful of other partners were invited by the management and told that their services would no longer be needed. Bloomberg was paid a $10 million severance package.

His final day at Salomon Brothers was 30th September, 1981, the very next day Bloomberg set out to build his own firm. He took $4 million of his $10 million severance package and created a financial data services firm called Innovative Market Systems. His understanding was that Wall Street and other businesses in general were willing to pay good money for business information delivered to them as quickly as possible in different usable forms.  Working with four others, Bloomberg was able to create a computer terminal that let their subscribers stay informed of the market.

READ ALSO:  Young Entrepreneur: Biyi Adeleke

In 1982, Innovative Market had its first customer. Merrill Lynch ordered and installed 22 of Bloomberg’s Market Master terminals and also paid $30 million for a 30% control of Bloomberg’s company. In 1987, the company’s name was changed from Innovative Market Systems to Bloomberg L.P. That same year the company sold its 5,000th terminal. By 1990 it had installed its 8,000th terminal.

Also in the 1990s Bloomberg launched other ancillary media products such as Bloomberg Business News, Bloomberg Radio, Bloomberg TV and Bloomberg Markets Magazine. In 1998 Bloomberg L.P. installed its 100,000 Terminal. The company was charging $1,500 per terminal per month, so during the 1990s it was already a billion dollar company.

Currently, Bloomberg L.P. has over 310,000 subscriptions and employs over 15,000 throughout its offices around the world.

Being so successful in business, Bloomberg decided it was time to serve the people. He decided to run for the position of Mayor of New York city in 2001. He eventually won and served three terms in office during which time he effected so landmark policies in the state. His salary during this his time in office was $1.

After completing his third and final term in office, Bloomberg spent the next eight month as a full time philanthropist. In March 2014, he returned to Bloomberg L.P. as CEO.

In September 2013, Forbes reported Bloomberg’s wealth as $33 billion and ranked him as the 13th richest person in the world. He is currently the 11th richest person in the world with a net worth of $41 billion. He is believed also to be the richest New Yorker.

In 1976 Bloomberg married his first wife, Susan Brown. They both had two children; Emma and Georgina. The couple divorced in 1993.

READ ALSO:  Amazing Business Story: Amancio Ortega

Michael Bloomberg is also a big donor, having donated over $2.4 billion to varying philanthropic causes. Despite his billions, Bloomberg, during his time in the mayor office rode the subway to work every morning.

The concept of disappointment breed blessing:

The concept of disappointment breeding blessing is one that has repeated itself in the lives of many millionaires and billionaires entrepreneurs. In the business life of Bloomberg the concept was pivotal to his successful and happened on two different occasions.

Firstly was when he was transferred from his powerful position as the head of equity trading and sales to head the young computer systems area. It felt like a demotion, but it wasn’t. Bloomberg will eventually go and start his own company; Innovative Markets Inc. Without the knowledge Bloomberg acquired during his time at the computer department, it is less likely that he will have started Innovative Markets. In hindsight, Bloomberg was grateful to the management at Salomon for the transfer.

Secondly was when he was laid off. It is painful enough to be told that one’s services will no longer be needed, it is worse when the news is coming at a time when things were changing in the organization for the better. The partners at Salomon Brothers were on the verge of becoming very wealthy when Bloomberg was asked to leave. Many would have considered this unfair and fought and lobbied against it, and some would have given up totally on life.

But that was not so for Bloomberg. He used part of his severance pay to start his own company and today, his company worth more than the business that laid him off.

Related Articles

Leave a Comment

%d bloggers like this: