What is BlackRock?

If you’ve been here for a while, you know that I am a fan of used Toyota Camrys. Well, I recently had the privilege of driving a Chrysler Pacifica plug-in hybrid minivan… that thing is the new king of the road. The most practical, efficient, comfortable drive of my life. From dropping your kids (and their friends) off at soccer practice to picking up mulch and plywood at Lowe’s, there is nothing a minivan can’t do. For the record, I have no need to do either of those things, but I want the ability to.

BlackRock is the world’s largest asset manager with $11.6 trillion in Assets Under Management (AUM) – as of December 31, 2024. BlackRock manages thousands of active and passive Mutual Funds, ETFs, and Closed-end Funds.

BlackRock was founded in 1988 by several people, but most notably, Larry Fink who remains the CEO to this day. Larry started as an investment manager at First Boston where he helped develop mortgage-backed securities…  Before they caused the 2008 recession, they caused First Boston to lose $100 million and Larry to lose his job in 1986. Naturally, Larry decided to start a new investment firm dedicated to risk management and fixed income. Larry might not know how to manage risk, but he surely knew the importance now.

BlackRock has three main entities: BlackRock, iShares, and Aladdin.

BlackRock is the overarching company and the active component with a more diverse selection of funds. BlackRock can raise funds for investments or utilize existing funds to purchase controlling or minority stakes in public and private companies. BlackRock uses its position to influence companies, on behalf of their investors, to make better (read: more profitable) decisions. So, what companies does BlackRock have big stakes in?

• Apple: 7.48%

• Microsoft: 7.75%

• NVIDIA: 7.74%

• Google: 6.51%

• Amazon: 6.49%

• META: 7.52%

• Berkshire Hathaway: 8.24%

• Tesla: 6.29%

Good luck trying to find an S&P 500 company they DON’T have a 6-8% stake in. They are in the top three shareholders for each company. The other top holders are Vanguard and State Street Corporation… but that is a rabbit hole I can’t go down.

Through all their funds, BlackRock has built an impressive position in each company. Because of their size, they have earned their fair share of “conspiracy” theories about controlling every company, government, and the world. They respond by saying, “We don’t own these shares, our investors do. We just manage it for them.” Okay… sure, Jan.

iShares is the section of BlackRock that you are possibly financially involved with. This is their ETF/Indexed Mutual Funds arm. They have competitive ETFs in both offering and expense ratio.

iShares first started in 1973 at Wells Fargo with various indexing strategies. They launched their first ETF in 1996. It was then purchased by Barclays and then BlackRock in 2009. 

Aladdin is a division I had not heard of until researching for this letter. Like I said above, Larry started BlackRock to focus on risk management and fixed income. 

Aladdin is BlackRock’s risk management platform and service. Companies, funds, and governments pay Aladdin to monitor their entire portfolio for risk. Aladdin oversees $21 TRILLION in assets. Aladdin doesn’t control these assets, but it monitors portfolios giving them insight and potentially advising them on risk mitigation. Of note, BlackRock is a client of Aladdin (kind of a weird set up), so that total does include BlackRock’s $11.6 trillion.

In 2008, Aladdin supported the US Government to oversee and manage the collapse of the entire financial market. Kind of ironic when you think about it… Larry helped develop mortgage-backed securities and then oversaw the recovery when they collapsed.

BlackRock either directly manages or oversees $21 trillion… That is more than every nation’s GDP except for the United States. I believe we are desensitized to how big this number is. So I will use my favorite analogy - time. Please scroll slowly to not ruin the surprise.

How much time do you think 1 million seconds is?

How many hours, days, weeks, months, years?

1 million seconds is 11.57 days. 

How much time do you think 1 billion seconds is?

How many hours, days, weeks, months, years?

1 billion seconds is 31.7 years. 

How much time do you think 1 trillion seconds is?

How many hours, days, weeks, months, years?

1 trillion seconds is 317 CENTURIES (31,700 years).

That means, if you could travel back in time one second for every dollar that BlackRock manages or oversees, you could go hang out with homo heidelbergensis, an early human species. Tell them to buy NVIDIA. 

So yeah, when you control that much money, conspiracy theories are inevitable. If you build it, they will come.

However, BlackRock grew because they offer superior products made accessible to more people. They are incentivized to make investing as easy as possible because the more people buying their ETFs, the more money they make. I will end with a quote from Larry Fink’s 2025 annual letter: 

That is a mission I can get behind. 

Debrief on Deck

Next week, we will talk about some mortgage truths and myths thanks to a few questions from readers. Spoiler alert: there is no secret trick to pay off your mortgage 7 years early.

As always, please reach out to us with any questions or comments you have. You can reply directly to this email or find us on Instagram.

Until then, stay the course.

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