BlackRock's Rob Goldstein on the Next Megatrends in Finance

In 1994, when Rob Goldstein joined BlackRock, the firm had 80 people and $19 billion in assets. He was on the data and analytics team, which was decidedly not where the "cool kids" wanted to be. Today, BlackRock has roughly 5,000 engineers, data analysts, and modelers, and Goldstein serves as its Chief Operating Officer. In a conversation with Odd Lots, he argued that the foundational insight behind BlackRock—that asset management is fundamentally an information processing business—is more relevant than ever, and that the current wave of AI will reshape the industry in ways that are only beginning to be understood.

The Founding Thesis: Technology as the Core

Goldstein traced BlackRock's origins to a specific technological arbitrage. The firm's founders were pioneers in structured mortgage products, an arena dominated by banks using expensive supercomputers. The founders realized that by stringing together ten Sun workstations—each costing about $10,000—they could replicate the computing power of a million-dollar supercomputer. This allowed them to build models that provided risk transparency for complex instruments, a capability largely absent on the buy side at the time. This was the founding thesis: using technology, not just financial acumen, as the core of the asset manager. Goldstein noted that this concept—that asset management is an information processing busines