What is Bloomberg? | The Untold Story of Bloomberg...

Summary

Bloomberg, a leading technology company, revolutionized the financial industry with its innovative terminals, offering real-time data and analytics. Founded by Michael Bloomberg, an electrical engineer turned entrepreneur, the company started with a focus on making brokerage work more efficient. Despite competition, Bloomberg's terminals remain a key revenue driver, with a 30% market share. The company has expanded into news, TV, and magazines, but its terminals continue to define its success in the financial sector.

Takeaways

• 💼 Bloomberg is a leading technology company known for its financial software and services, with revenues over nine billion dollars in 2017.
• 🎓 Michael Bloomberg, the company's founder, has a background in electrical engineering and an MBA, and started his career at Salomon Brothers, rising to partner by age 30.
• 💡 After being let go from Salomon Brothers, Bloomberg used his severance package to establish Innovative Market Solutions, which aimed to streamline brokerage work.
• 📈 The Bloomberg Terminal was the company's first major innovation, providing real-time data and analytics to reveal investment opportunities and streamline trading.
• 💼 Bloomberg targeted institutional investment firms with its terminal, which was too expensive for individual investors.
• 💸 A Bloomberg Terminal subscription is costly, with a significant discount for multiple users, reflecting its niche market strategy.
• 🌐 Bloomberg's services have evolved to include online and mobile access, allowing for real-time market information from anywhere.
• 🏢 Despite competition from companies like Thomson Reuters, Bloomberg maintains a slight edge with 30% market share, attributed to its first-mover advantage.
• 📰 Bloomberg has expanded beyond technology, launching a news outlet, TV channel, and acquiring the historic Bloomberg Businessweek magazine.
• 🏆 Michael Bloomberg's company has become synonymous with Wall Street, revolutionizing the financial industry and solidifying its position as a corporate giant.

Q & A

Who is Michael Bloomberg and what is his connection to Bloomberg L.P.?

Michael Bloomberg is an entrepreneur who founded Bloomberg L.P., a global financial software, data, and media company. He is also a former mayor of New York City.

What was Michael Bloomberg's educational background before starting Bloomberg L.P.?

Michael Bloomberg graduated from Johns Hopkins University with an electrical engineering degree and later obtained an MBA from Harvard Business School.

What was Michael Bloomberg's initial role at Salomon Brothers, and how did it influence the creation of Bloomberg L.P.?

At Salomon Brothers, Michael Bloomberg initially managed the firm's information technology system, which was a tedious task. This experience inspired him to create a more efficient system for brokerage work, leading to the development of the Bloomberg Terminal.

What was the primary purpose behind the creation of the Bloomberg Terminal?

The Bloomberg Terminal was designed to make the process of finding the value of securities and revealing investment opportunities more efficient by consolidating information from various investment types like stocks, bonds, and currencies.

Who were some of the key early employees that helped develop the Bloomberg Terminal?

Some of the key early employees included Tom Secunda, who started writing analytics programs, and other former Salomon Brothers employees who had a deep understanding of the needs of investment firms.

How did Bloomberg L.P. initially market the Bloomberg Terminal, and who was its first target customer?

Bloomberg L.P. initially marketed the Bloomberg Terminal by pitching it to Merrill Lynch's capital market division. The first target customer was the head of the division, Ed Moriarty.

What was the advantage Bloomberg L.P. had when developing the Bloomberg Terminal, and how did it help them create a successful product?

The advantage Bloomberg L.P. had was the team's prior experience working in investment firms, which gave them a clear understanding of the needs and requirements of their target market, leading to the creation of a product that met those needs.

What is the cost of a Bloomberg Terminal subscription, and how does it compare to competitors?

A Bloomberg Terminal subscription costs twenty-four thousand dollars per user, with a discount for two or more subscriptions at twenty thousand dollars per user. Competitors like Thomson Reuters offer their services at a lower price point.

How has Bloomberg L.P. managed to maintain a competitive edge in the financial data market despite competition?

Bloomberg L.P. has maintained a competitive edge by being the first in the market, offering a reliable and established service that financial firms are accustomed to using. Their brand is synonymous with Wall Street, and the convenience of staying with a known provider outweighs the benefits of slightly cheaper alternatives.

What are some of the ventures Bloomberg L.P. has embarked on outside of the financial data industry?

Bloomberg L.P. has ventured into media with the launch of Bloomberg News in 1991, Bloomberg Information TV in 1994, and the acquisition of the magazine Bloomberg Businessweek in 2009.

What is the current status of Michael Bloomberg regarding his political ambitions?

As of the information provided, Michael Bloomberg has confirmed that he has no intention of running for president and prefers to focus on actual work.

Outlines

00:00

💼 The Rise of Bloomberg: From Salomon Brothers to a Financial Giant

The paragraph details the journey of Michael Bloomberg from his early career at Salomon Brothers to founding Bloomberg L.P. After being laid off, he used his severance package to start Innovative Market Solutions, which aimed to streamline the brokerage process. His first invention, the Bloomberg Terminal, revolutionized the way investment firms operated by providing real-time data and analytics. The terminal targeted institutional investors, offering a professional investment system for the financial marketplace. Despite competition, Bloomberg's early market entry and continuous innovation allowed it to maintain a significant market share in the financial data industry.

05:01

📈 Bloomberg's Diversification and Market Dominance

This paragraph discusses Bloomberg's expansion beyond the financial terminal business. It opened a news outlet, Bloomberg Business News, in 1991 and later launched a TV channel and magazine, Bloomberg Businessweek. The company has maintained a strong presence in financial news and information, offering real-time data, trading news, and analysis tools. Despite competition and the need for adaptation to new technologies, Bloomberg's established reputation and user-friendly services have kept it as a market leader. The paragraph also touches on Michael Bloomberg's political career and his decision not to run for president, emphasizing the company's focus on practical work over political ambitions.

Keywords

💡Bloomberg

Bloomberg is a global information and technology company that specializes in providing financial software tools, data services, news, and analytics. It is a key player in the financial industry, with its eponymous Bloomberg Terminal being a widely used platform for real-time data and analytics. The company was founded by Michael Bloomberg, who also served as New York City's 108th mayor. The video discusses Bloomberg's rise to prominence and its impact on the financial sector.

💡Michael Bloomberg

Michael Bloomberg is the founder of Bloomberg L.P. and a former mayor of New York City. He graduated from Johns Hopkins University with an electrical engineering degree and later earned an MBA from Harvard Business School. After working at Salomon Brothers, he used his severance package to start Innovative Market Solutions, which later became Bloomberg L.P. The video highlights his journey from a Wall Street employee to a successful entrepreneur.

💡Salomon Brothers

Salomon Brothers was an investment firm in New York City where Michael Bloomberg began his career. He quickly rose through the ranks to become a partner by the age of 30. After the firm was sold, Bloomberg was let go, which led him to start his own company. The video mentions Salomon Brothers as a significant part of Bloomberg's early career and the inspiration for his first business venture.

💡Bloomberg Terminal

The Bloomberg Terminal is a computer system provided by Bloomberg L.P. that enables professionals in finance, trading, and investment banking to access Bloomberg's professional services. It offers real-time financial market data and news, and is considered a standard tool in the industry. The video explains how the terminal was developed to streamline and simplify the complex and tedious tasks of financial analysis.

💡Innovative Market Solutions

Innovative Market Solutions was the original name of Bloomberg L.P. when it was founded by Michael Bloomberg. It was inspired by his work at Salomon Brothers and aimed to make brokerage work more efficient. The video describes how this company developed the Bloomberg Terminal, which became a cornerstone of its business and a significant innovation in the financial industry.

💡Financial Market Data

Financial market data refers to the various types of information that are used by investors to make informed decisions about buying and selling securities. This includes stock prices, bond yields, currency rates, and other financial metrics. The Bloomberg Terminal is highlighted in the video as a tool that provides comprehensive and real-time financial market data to its users.

💡Thomson Reuters

Thomson Reuters is a global provider of news and information services, and a competitor to Bloomberg in the financial data and news sector. The video mentions Thomson Reuters as holding a significant market share and being a major competitor to Bloomberg, offering its own suite of financial data and news services.

💡Market Share

Market share refers to the percentage of the market for a particular product or service that is controlled by a particular company. In the context of the video, Bloomberg holds a 30% market share in the financial data and news industry, indicating its dominance and the extent of its customer base.

💡Bloomberg News

Bloomberg News is the news outlet of Bloomberg L.P., which provides business and financial news. Established in 1991, it operates in various formats, including television, radio, and online platforms. The video discusses Bloomberg News as part of the company's expansion beyond financial software and data services into the media industry.

💡Bloomberg Businessweek

Bloomberg Businessweek is a weekly business magazine that Bloomberg L.P. acquired in 2009. It covers various aspects of business and finance and is known for its in-depth reporting and analysis. The video mentions this magazine as an example of Bloomberg's diversification into different media formats to reach a broader audience.

Highlights

Bloomberg is a leading technology company with over 20,000 employees and $9 billion in revenue in 2017.

Michael Bloomberg graduated from John Hopkins University with an electrical engineering degree and later got an MBA from Harvard Business School.

He started his career at Salomon Brothers, where he quickly rose to become a partner by age 30.

After being let go from Salomon Brothers, Michael used a $10 million severance package to start Innovative Market Solutions.

The Bloomberg Terminal was invented to make brokerage work more efficient and less tedious.

The first Bloomberg Terminal aimed to provide real-time data and analytics to investment firms.

Merrill Lynch's capital market division became the first target customer for the Bloomberg Terminal.

The Bloomberg Terminal offered a significant advantage by understanding the needs of investment firms.

Bloomberg services are targeted at institutional investment firms due to their high cost.

A Bloomberg subscription provides access to real-time market information and is heavily used in the financial industry.

Bloomberg has faced competition from Thomson Reuters and other financial data providers.

Bloomberg's first-mover advantage and reputation have helped it maintain a leading position in the market.

Despite being slow to adapt to new technology, Bloomberg's focus on data has not hindered its success.

Bloomberg has expanded beyond the terminal to include a news outlet, TV channel, and magazine.

Michael Bloomberg served as New York City's 108th mayor from 2002 to 2013.

Bloomberg's key revenue driver remains the Bloomberg Terminal, which integrates price data, financials, trading data, and news.

The company has revolutionized the financial industry by streamlining investment processes and data access.

Transcripts

Bloomberg is one of the largest

technology companies in the world

pulling in over nine billion dollars in

2017 with over 20,000 employees we have

probably heard of Michael Bloomberg our

maybe read news on their website but

what exactly is Bloomberg even dude and

how did it get so big make sure you

stick around till the end to find out

[Music]

welcome to haria Celebes so all sort of

Michael Bloomberg graduated from John

Hopkins University with an electrical

engineering degree he would then get an

MBA at Harvard Business School and land

a job at an investment firm in New York

City called Salomon Brothers his first

task was very tedious with him having to

count out and organize millions of

stocks and bonds but thanks to his

quick-thinking and remarkable work ethic

he had quickly rise up and become a

partner by 1972 at the age of 30

this next task was to run the firm's

information technology system which is

again very very tedious and boring this

was he has the most glamorous portion of

the business as it was far from the

actual deals an action generating

revenue but Michael did deal with it

unfortunately though in 1981 Salomon

Brothers sold and Michael was sent off

it wasn't all bad though he had a ten

million dollar a severance package which

he used to set up a new information

technology company named innovative

market solutions this was very much

inspired by his work at Salomon Brothers

and he wanted to make brokerage work

much easier and less tedious and this

desire to make the process more

efficient is what would lead to his

first invention until now finding the

value of one security versus another was

very tedious and there really was no

progress since the 1960s it was just a

bunch of guys using number-two pencils

working all day he imagined building a

system that took information from

several different vestment types like

stocks bonds and currencies and

revealing the position of a firm at any

given point this opened up hidden

investment opportunities as revealed

previously inaccessible data to achieve

this he hired for Salomon Brothers and

former employees one of these four

people was Tom Segundo who will start

writing analytics programs and get to

work on what would soon become the

Bloomberg terminal

first target customer was merrill

lynch's capital market division michael

pitched an idea alone to head of the

division ed Moriarty and when Michael

finished presenting Moriarty asked to

head up the software division how long

it would take them to create it

themselves the head of the software

development team aleksandr told him that

if they didn't get any new work for the

next six months then they can start

right after michael immediately promised

that he would be able to get it done in

six months before they would even be

able to start and that they didn't have

to buy it if they didn't like it and

with that they really started to bring

the Bloomberg terminal to life they had

a significant advantage as I knew

exactly what investment firms were

looking for as they had all worked at

one before and this led them to create

the Bloomberg terminal which is still

heavily used even today it is regarded

as a professional investment system for

the financial marketplace so clearly the

Bloomberg terminal was of great use but

the only thing is that it is only

targeted at institutional investment

firms it is simply too expensive for

most individual investors and is

unfeasible for them today a subscription

to Bloomberg services costs twenty four

thousand dollars per user but if you

like two or more it's only twenty

thousand per user that's still a lot of

money but it is a sizable discount and

this is probably why you never knew a

Bloomberg did as they targeted niche

demographic that most of us don't have

any connection to the first system was

not elegant or complex but it was

resourceful and got the job done the

system provided price quotes and a lot

of messaging through a secure

proprietary network and for the end user

it was a windows-based application which

made it really convenient to use it with

Excel Excel is one of the most crucial

programs for the financial industry so

this was very important and as

technology has evolved they have also

started offering an online application

that can be accessed through mobile

devices portfolio managers and brokers

have the ability to use Bloomberg

anywhere services to access real time

market information any word in the world

this makes it very convenient and is a

huge advantage of Bloomberg subscription

but it wasn't an easy road though there

was a lot of competition from big

corporations as well Thomson Reuters I

can was her biggest competition which

still holds 25%

I could share even today Bloomberg still

has a slight edge holding 30% of market

share but clearly I can is not a joke

they also offer better value charging

four thousand dollars less per year at

twenty thousand dollars per year and

it's not just them there are also

several other companies we have sizable

chunks of market share and are also

cheaper as well

companies like fact set capital IQ and

simply just name a few Bloomberg is able

to deal with all this competition

because they are always one step ahead

by being the first in the market this

has made them the gold standard for

financial market news data and trading

tools today there are almost synonymous

with Wall Street and this lead helps

them out more than you would think even

though other services might offer

something cheaper and still provide the

same value it just convenient to stay

with Bloomberg trading firms don't need

to retrain staff and they don't have to

have a down time while software is being

updated on computers they have been

there for so long and it is just easier

to use the same soft great year after

year and for big firms like Goldman

Sachs an extra four thousand dollars

really is not worth going through all of

that hassle now there is some

disadvantages with using Bloomberg the

biggest of which is that they are slow

to adapt to new technology it took them

a pretty long time to adapt the 64-bit

systems but for the financial industry

this really doesn't matter because

they're not gonna be trying to remodel a

car or something they simply need data

and they don't need the most up-to-date

technology in order to do that plus it's

not like Bloomberg never adapts it just

takes them a little bit longer overall

Bloomberg is able to fend off a lot of

competition as they were the first in

the market firms are already Euston and

they don't see a need to change unless

someone else offers something

significantly different the slightly

cheaper price is really no big deal so

clearly Bloomberg terminals played took

off and even to this day Bloomberg

terminals make up most of their revenue

but since then they have also gone on

other ventures are not technology driven

for example they opened their own news

outlet 1991 called Bloomberg Business

News and their open offices in New York

London Toronto washing

gentoku and many more Bloomberg News has

always had a very editor driven culture

and they have a very specific way of

drying their articles in fact they have

their own book on how to write Bloomberg

articles called the Bloomberg way a

guide for reporters and editors they

even launched her own TV channel in 1994

called Bloomberg information TV they had

a variety of business-related shows and

news about the state of the economy and

financial industry as a whole they also

had their own magazine called Bloomberg

Businessweek this is a weekly American

business magazine but they didn't create

this one though this magazine actually

first published in September of 1929 and

it wasn't till July of 2009 almost

eighty years later they are acquired

this magazine the magazine had fell on

hard times after the 2008 economic

recession and Bloomberg would buy it for

two to five million dollars as it is

cleared since the terminal they have

also got several other ventures as well

today

Bloomberg is a major global provider of

financial news and information they

offer real-time and historic price era

financial data trading news and analyst

coverage as well as general news and

sports they have several services that

span across radio television and

magazines they offer professional

analysis tools for financial

professionals but even to this day

Bloomberg's key revenue earner remains

the Bloomberg terminal which is an

integrated platform the streams together

of price data financials trading data

and news he was also New York's he's

108th mayor serving from 2002 to 2013

there was also been a lot of rumors that

he's going to be running for president

but he's confirmed that he wanted do

less talking and more actual work he

says that Hugh Rowland sleeves up and

get to work and that he had no intention

for running for president but despite

that Michael Bloomberg and his company

are really quite inspirational Bloomberg

is a company that most of us have heard

about but really didn't know what they

did we have seen their magazines and

news articles but with actually their

background contribution to Wall Street

for terminals that really made them a

corporate giant they have

truly revolutionize the financial

industry eliminating the need for

tedious busy work and they have a lot

for much more effective investing across

Wall Street given this contribution it's

no wonder why they're so successful but

that's all I have for you guys on

Bloomberg make sure comment down below

what company you would like to really

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when til then I'm Hardy I'll see you

guys on next one