Goldman Sachs

• 1. Introduction

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  Goldman Sachs began in a one-room basement office next to a coal chute in New York City in 1869. That is the unglamorous origin of a firm that would one day advise governments, underwrite the shares of companies that would reshape American life, and sit at the center of some of the most consequential financial events of the past century. What made it possible to travel from a coal chute to the heights of global finance? And what price did that journey exact?

  The questions worth asking about Goldman Sachs are not simply about money. They are about how a family firm built on personal relationships became an institution ranked 20th in the Forbes Global 2000 in 2025. They are about how one philosophy, described in four words, shaped decades of decisions. And they are about what it means to be considered a systemically important financial institution, a designation that carries as much weight as any trophy on a boardroom wall.

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• 2. A Family Affair

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  Marcus Goldman founded the firm alone in 1869 and ran it for more than two decades before his son-in-law Samuel Sachs joined in 1882. Three years later, Marcus's own son Henry Goldman and another son-in-law, Ludwig Dreyfuss, joined as well. That moment, in 1885, is when the firm took the name it carries today: Goldman Sachs & Co.

  The firm's early identity was built on a specific financial instrument: commercial paper. Goldman pioneered its use for entrepreneurs at a time when most lenders focused on companies with substantial physical assets. That innovation allowed the firm to serve retailers and businesses that book value alone could not capture. Goldman Sachs joined the New York Stock Exchange in 1896, and by 1898 its capital stood at $1.6 million.

  Personal relationships drove the firm's first landmark deal. When Goldman Sachs entered the IPO market in 1906 by taking Sears, Roebuck and Company public, the transaction was made possible by Henry Goldman's friendship with Julius Rosenwald, an owner of Sears. That same year, General Cigar Company also went public through the firm. F. W. Woolworth Company followed in 1912. The firm was doing something new as well: it championed the price-earnings ratio as a way to value companies, rather than relying on book value, which gave it an edge in markets where intangible worth was hard to measure.

  In 1912, Henry S. Bowers became the first person outside the founding family to make partner. That year also brought a deeper political fracture. By 1917, Henry Goldman's openly pro-German stance during the war had strained his relationships with the other partners badly enough that he resigned. The Sachs family held the firm alone until Waddill Catchings joined in 1918 and rose to hold the largest single stake of any partner by 1928.

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• 3. Catastrophe and Recovery

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  On the 4th of December 1928, Goldman Sachs launched the Goldman Sachs Trading Corp., a closed-end fund that would become one of the firm's most damaging early ventures. The fund failed during the Wall Street Crash of 1929, and the firm faced accusations of share price manipulation and insider trading. The reputational damage was severe.

  The response came in 1930, when the firm removed Catchings and elevated Sidney Weinberg to senior partner. Weinberg pulled the firm back from trading and toward investment banking, a shift that gave it steadier footing during the Great Depression. The strategy worked. Weinberg's tenure produced some of the firm's most significant advisory roles: he led Goldman Sachs as the lead advisor on the $657 million IPO of Ford Motor Company in 1956, and the firm arranged a $350 million debenture offering by Sears Roebuck in 1958. Weinberg also built the firm's research capabilities, establishing an investment research division and a municipal bond department.

  In the 1950s, a new force arrived in the form of Gus Levy, who joined as a securities trader. Levy became a pioneer in block trading. His rise set up an internal contest for influence between the trading and investment banking sides of the house. That tension shaped the firm's structure for decades. In 1957, Goldman Sachs relocated its headquarters to 20 Broad Street.

  The Penn Central Transportation Company's bankruptcy in 1970 presented another near-crisis. Penn Central collapsed with more than $80 million in commercial paper outstanding, most of it issued through Goldman Sachs. The SEC's resulting lawsuits threatened the firm's capital and its survival. That crisis had a lasting consequence beyond the firm itself: it prompted credit rating agencies to begin assigning ratings to every issuer of commercial paper, a practice that remains standard today.

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• 4. Long-Term Greedy

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  Gus Levy took over as senior partner in 1969, the same year Sidney Weinberg died. Levy is the person most associated with the phrase that would become Goldman Sachs's unofficial guiding principle: being "long-term greedy." The idea held that short-term losses were acceptable as long as the firm made money over a longer horizon. Partners reinforced this by reinvesting nearly all of their earnings back into the firm.

  Levy's decade at the top also saw the firm expand internationally. Under partner Stanley R. Miller, Goldman Sachs opened its first office outside the United States in London in 1970. That same year it created a private wealth management division, and in 1972 it added a fixed income division. The firm also developed what it called the "white knight" strategy in 1974, deploying it to defend Electric Storage Battery against a hostile takeover bid from International Nickel and Morgan Stanley. When John Weinberg, Sidney's son, and John C. Whitehead became co-senior partners in 1976, they formalized the culture by establishing 14 business principles.

  The 1980s brought rapid expansion on multiple fronts. On the 16th of November 1981, Goldman Sachs acquired J. Aron & Company, a commodities trading firm that had been active in coffee and gold markets. That acquisition merged with the Fixed Income division to create Fixed Income, Currencies, and Commodities, and it brought to the firm a young trader named Lloyd Blankfein, who would one day run it. In 1983, the firm moved into new global headquarters at 85 Broad Street. The decade also brought the Microsoft IPO in 1986, advisory work on General Electric's acquisition of RCA, and the firm's own innovation in distributing investment research electronically, making it the first bank to do so.

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• 5. Going Public

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  After decades of internal debate, Goldman Sachs sold shares to the public in May 1999. The IPO priced shares at $53 each. The firm sold 12.6% of itself to outside investors. After the offering, 221 former partners held 48.3% of the firm, non-partner employees held 21.2%, and the remaining 17.9% was split between retired Goldman partners and two longtime investors: Sumitomo Bank Ltd. and Assn, the investing arm of Kamehameha Schools.

  Henry Paulson became chairman and chief executive officer after the IPO, succeeding Jon Corzine. In May 2006, Paulson left to serve as United States Secretary of the Treasury, and Lloyd Blankfein, who had arrived through the J. Aron acquisition, moved into the chairman and CEO role.

  In September 2008, the firm confronted its most acute moment of modern crisis. Goldman Sachs and Morgan Stanley, the last two major independent investment banks in the United States, announced together that they would convert to bank holding companies. The Federal Reserve's approval of that conversion effectively ended the model of the independent securities firm that Congress had created 75 years earlier when it separated investment banks from deposit-taking lenders. Within days, Berkshire Hathaway agreed to purchase $5 billion in Goldman Sachs preferred stock and received warrants to buy another $5 billion in common stock within five years. The firm also raised $5 billion through a public share offering at $123 per share and received a $10 billion preferred stock investment from the U.S. Treasury through the Troubled Asset Relief Program.

  Goldman Sachs repaid the Treasury's TARP investment in June 2009, with 23% interest, which came in the form of $318 million in preferred dividend payments and $1.418 billion in warrant redemptions. On the 18th of March 2011, the Federal Reserve approved the firm's request to buy back Berkshire Hathaway's preferred stock as well.

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• 6. Beyond Investment Banking

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  Marcus by Goldman Sachs launched in October 2016, offering no-fee unsecured personal loans under the Goldman Sachs Bank USA brand. It was a deliberate step into consumer finance, a territory the firm had largely avoided throughout its history. Goldman Sachs Bank USA had already acquired General Electric's GE Capital Bank online deposit platform in August 2015, picking up $8 billion of online deposits and another $8 billion in brokered certificates of deposit in the process.

  In March 2019, Apple announced a partnership with Goldman Sachs to launch the Apple Card, the firm's first credit card. The arrangement marked a striking departure for a bank better known for advising on mergers worth billions than for issuing plastic to individual consumers. But in January 2026, Goldman Sachs announced that it had entered into an agreement to transfer the Apple Card program to JPMorgan Chase in 2028, drawing that experiment in consumer credit to a close.

  On the asset management side, the firm agreed in August 2021 to acquire NN Investment Partners from NN Group for 1.7 billion euros. NN Investment Partners held $335 billion in assets under management at the time of the deal.

  The firm's ownership by the end of 2025 reflected the institutional character of modern large-cap American companies. The Vanguard Group held 9.78% of Goldman Sachs, BlackRock held 7.84%, and State Street Corporation held 6.59%. JPMorgan Chase, interestingly, held 2.65%, making the bank that will take over the Apple Card program also one of its larger shareholders.

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• 7. The Global Alpha Experiment

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  In the mid-1990s, Goldman Sachs seeded a new hedge fund called Global Alpha with $10 million. Cliff Asness and Mark Carhart founded the fund and built the statistical models that drove its strategy. Global Alpha used quantitative analysis and computer-driven models to invest, relying heavily on high-frequency trading.

  The fund grew into something substantial enough that The Wall Street Journal described it as a "big, secretive hedge fund" and called it the "Cadillac of a fleet of alternative investments" that had made millions for Goldman Sachs by 2006. At its peak in 2007, Global Alpha held more than $12 billion in assets under management.

  That peak did not last. By mid-2008, assets had fallen to $2.5 billion. By June 2011, they had declined further to less than $1.7 billion. By September of that year, the fund held approximately $1 billion and had suffered losses. Goldman Sachs announced the shutdown of Global Alpha on the 16th of November 2011. It had begun with $10 million and ended with roughly $1 billion, a trajectory that said something real about how difficult it is to sustain algorithmic advantage over time, even inside one of the largest investment banks in the world.

  David Solomon succeeded Lloyd Blankfein as chairman and CEO in 2018, taking charge of a firm that now employs more than 47,000 people and reported revenues of $58.283 billion in 2025. From that coal chute basement in 1869 to a headquarters at 200 West Street that opened on the 16th of November 2009, the distance is not just geographical.

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