Charles R. Schwab
American stockbroker (1937 - )
- || At The Bottom
1971 -- Charles R. Schwab stared at his desk, wondering how everything could have gone so wrong with his life. The young stockbroker watched helplessly as his first company -- a partnership formed with two other men -- collapsed, brought down when the partners neglected to register some of their securities with Texas financial regulators. The state insisted that Schwab and his partners provide refunds (with interest) to everyone in Texas who had purchased their unregistered financial products. When the company -- at Schwab's insistence -- decided to fight the case, the Securities and Exchange Commission stepped in and blocked the brokerage from selling anything to anyone, anywhere in the US. The partnership soon disintegrated, leaving Schwab more than $100,000 in debt. His reputation was destroyed, and his marriage soon followed. At 34, Schwab was a bust.
- || At The Top
2008 -- When Charles Schwab, an avid golfer, stepped up to the tee on a late July morning, only 54 individuals in the United States could claim to be wealthier than him. Schwab had just stepped down as the CEO of his own company, taking with him a trusted reputation and assets valued at more than $6.2 billion. It was the second time that Schwab had given up the title of CEO, having initially stepped down in 2003; when his successor veered away from what Schwab called the company's "heritage" of attention to individual investors, Schwab returned to set the company back on course. He did just that, helping raise the value of Schwab stocks by more than 150 percent as its client assets rose to nearly $1.5 trillion. In addition to being one of the wealthiest and most successful figures in the financial world, Charles Schwab had also become an important philanthropist, creating a foundation to help children struggling with learning difficulties (including dyslexia, from which Schwab himself suffers).
- || The Comeback
Bailed out by an uncle who agreed to pay his nephew's debts, Schwab started a new brokerage partnership soon after the debacle that nearly ruined him. Schwab's uncle wondered if he'd ever get his money back and grew irritated by what he perceived as an unclear business plan. After some fits and starts, Schwab eventually assumed control of the entire operation and focused his energy on filling an emerging need in the financial services industry: the discount brokerage, which appealed to small investors who were not welcomed by investing giants like Merrill Lynch. It was a bad time for the stock market in the mid-1970s, and the economy was treading water, but Schwab liked the idea of reaching out to the "little guy." By offering lower commissions than their competition and pioneering the no-load mutual fund, Schwab soon owned the largest discount brokerage in the country, with branches all over the US and half a million accounts under its management. By refusing to follow the conventional path to success in the financial world, Schwab saw an emerging opportunity and blazed his own path to the top.
