Marcus Goldman
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Marcus Goldman, * 1821 in Burgebrach, Germany is the founder of the investment banking firm Goldman Sachs.
For most of its history Goldman Sachs was run by three families: the intermarried Goldmans and Sachses and the upstart Weinbergs. Members of the Goldman and Sachs families served the firm for more than a century. Success for these men was defined not in terms of a quarter's profits, or even by a couple of good years, but in leaving their heirs a stronger business than the one they themselves had inherited.
Marcus Goldman, a former schoolteacher and the son of a peasant dealing in cattle, arrived from Frankfurt am Main, Germany in 1848 in the first great wave of Jewish immigration to America and thrived as a peddler with a horse-drawn cart and later as a shopkeeper in Philadelphia. There Goldman met and married eighteen year old Bertha Goldman, who had also immigrated from Germany in 1848. In 1869, with his wife and five children, Goldman relocated to New York and hung out a shingle on Pine Street in lower Manhattan, Marcus Goldman & Co., setting himself up as a broker of IOUs.
From his earliest days of his business, Goldman was able to transact singlehandedly as much as $5 million worth of commercial paper a year. Successful though he was, Goldman's business was insignificant compared to that of the other German-Jewish bankers of his day. Concerns like Seligman's, with working capital of $6 million in 1869, were already modern day investment bankers immersed in underwriting and trading railroad bonds.
Goldman's youngest daughter, Louisa, married Samuel Sachs, the son of close friends and fellow Bavarian immigrants. Louisa's older sister and Sam's older brother had already married.
In 1882, Marcus Goldman invited his son-in-law Samuel to join him in the business and changed the firm's name to M. Goldman and Sachs. Business was booming - by 1880 the new firm was turning over $30 million worth of paper a year - and the firm's capital was now $100,000, all of it the senior partner's.
For almost fifty years after its inception all of Goldman Sachs's partners were members of the intermarried families. In 1885, Goldman took his own son Henry and his son-in-law Ludwig Dreyfuss into the business as junior partners and the firm adopted its present name, Goldman Sachs & Co. In 1894, Herry Sachs entered the firm, and in 1896 the firm joined the New York Stock Exchange.
When Marcus Goldman retired he left the firm in the hands of his son Henry and his son-in-law Samuel Sachs. In 1904 two of Sam Sachs's sons, Arthur and Paul joined the firm straight out of Harvard University. In the summer of that year their grandfather, Marcus Goldman, died. His had been a remarkable life. From the most humble beginnings, the institution he left behind would soon become a full-service investment bank. With the advent of underwriting, coupled with the extensive lending, foreign exchange, and trading operations, the structure of Goldman Sachs was in place. Although much smaller and less sophisticated, it was already recognizable as the firm it would become.
Goldman Sachs[1]
