#253 Henry Goldman (Goldman Sachs)

**David Senra** (0:00)
Among the many letters of sympathy received by the family after Henry's death was one from Sydney Weinberg, who had been elevated to the position of partner in Goldman Sachs in 1927, and assumed the role of senior partner five years later. Weinberg had started his career with the firm as a janitor's assistant, an eighth grade dropout, whose chores included cleaning the office and brushing off the partner's boots.
For a long time, he was known around the office simply as boy.
But like Henry, whom he greatly admired and viewed as one of the geniuses behind the success of Goldman Sachs, Sidney was an excellent listener and an adaptive student. In 1919, after he left the Coast Guard in which he served during World War I, he approached Henry seeking a job.
Henry advised him to return to Goldman Sachs. That was where the opportunity lay, he said. Demonstrating once again a canny talent for spotting human potential, Henry offered to act as Weinberg's mentor and to introduce him to valuable contacts in the business world. At Goldman, Weinberg became a salesman of commercial paper for $28 a week plus 1.8% in commissions.
Henry advised him to ask for a bigger piece of the pie as his sales escalated, and he advanced to earning 33% commission at a time when the stock market was booming.
And in the 1930s, Henry recommended and endorsed him for seats on many of the corporate boards on which he would serve for almost 40 years.
Weinberg joined Walter Sachs as a co-chairman of the firm, became a trusted advisor to presidents and corporate chairman, and was credited with steering Goldman Sachs into a revitalized era of prosperity and stature.
That was an excerpt from the book that I'm gonna talk to you about today, which is when money was in fashion, Henry Goldman, Goldman Sachs, and the founding of Wall Street, and it was written by Henry's granddaughter, June Breton Fisher. So I wanted to start with that excerpt that comes at the end of the book, Henry had just died, to prove a point that he was just doing an act of kindness. That happened in the, he was helping Sidney Weinberg in the 1920s. He had already been forced out of the Goldman Sachs partnership, so he didn't have any financial benefit to the wonderful career that Weinberg winds up going and having at Goldman Sachs over the next 40 years. There's actually two additional resources I used to prepare for the podcast in addition to reading this book. And one of them is this essay, and I'll link down below in the show notes for both of these, but one of them is an essay that Malcolm Gladwell wrote in 2008 It's called The Uses of Adversity and it's about Sidney Weinberg's story. Henry Goldman makes an appearance in that essay as well. I thought it was worth the time I invested in reading it. And the second was an episode of a podcast, it's Business Breakdowns. The title of the podcast is Goldman Sachs, Fortune Favors the Old. And that episode's great because in an hour, they give you a complete overview of the Goldman Sachs of today, how they make money, what businesses they're involved in, how the firm is organized today. So I wanna jump right into the book. There's this quote that's on the first chapter that I thought was fantastic. And it comes from Walter Sachs, who at the time was a senior partner of Goldman Sachs. He said this in 1928 So this is about 11 years after Henry's forced out of the firm, which I'll get to, which was one of the most surprising parts of the book for me. And Walter said, Men can learn from the past. And I've been shocked how little some of the younger executives in the present firm know about its origins. They don't even know that my grandfather, whose picture is on the wall there, founded the firm. And that just speaks to why the book was written. It's meant to catalog the history, the very beginning of the firm. It ends, the story ends in like the 1920s, 1930s. And what is unique about this book is it kind of reads like a family diary. So let's go right to the beginning. It says, my grandfather, Henry Goldman, was the son of a poor German immigrant named Marcus Goldman. Marcus Goldman is going to be the founder of Goldman Sachs. And I've actually looked for biographies of Marcus Goldman in the past and haven't found any. And I think the first part of this book kind of serves as a brief overview of how Marcus got to America and how he's in it, when he started, what would eventually become Goldman Sachs. And then the vast majority of the book is about Henry Goldman. But I think this brief overview of Marcus's life is very useful. And so the note I left myself when I first read this part was this is how Goldman and Sachs actually meet. This is happening in Bavaria. And Marcus's father, his name is Wolf. So it says, Wolf was especially proud of his son, Mark, who at the age of 16 had been encouraged by the schoolmaster to make periodic trips to the synagogue where the rabbi offered more advanced classes to outstanding students. It was there that Mark made the acquaintance of Joseph Sachs, the 19 year old son of a poor saddle maker. The two young men became fast friends, never dreaming that their futures would be entwined for more than a century in a land they had yet to see. And so Joseph Sachs keeps popping up in Marcus's life. And I was like, when are they gonna start this company together? I didn't realize that it's not, that is not the, Joseph Sachs is not the Sachs that is the Goldman Sachs. It's going to be his son. Marcus brings in Joseph's son. And then once he brings him into the partnership that he's already started, they rename the firm, firm Goldman Sachs.