Bloomberg Signed Merrill Lynch Before the Product Even Existed

Source: Founders Podcast | Published: 2026-09-14T18:53:19Z

Merrill Lynch put in $30 million in 1982 and walked away with roughly $4.6 billion by 2008. Bloomberg's only comment: not a bad return.

Most people in that situation would grieve for a while, then slowly figure out what's next. Bloomberg's move: take the money, start a company the following week.

Sales Is the Foundational Skill Behind Every Career

When Bloomberg graduated from Harvard Business School, his classmates were fighting over research analyst and investment banking roles — the ones with private offices and prestige. He took an offer from Salomon Brothers to count securities, in a bank vault with no air conditioning, working in his undershirt, occasionally cracking open a beer just to get through the day.

When friends asked what he was doing, he told them he was "studying methods and procedures to streamline workflows." He was too embarrassed to tell the truth.

But he later considered it the most important training of his career. At Salomon Brothers, he had to pick up the phone and sell securities to clients. His two bosses, Billy and John, would stand behind him without a word and watch him work the phones — persuading, explaining, pleading, pressuring. When the call ended, they'd walk away without congratulating him, because they didn't need to. Closing was expected, not exceptional.

He offers a definition of sales in his book, crisp enough to read like a conclusion rather than a process: "We did what all good salespeople do: laid out everything we had, then highlighted the facts that let the client convince themselves they were getting a good deal."

That logic would run through every aspect of how he built the company.

Becoming "Friends" with the Managing Partner at 26

In his second year at Salomon Brothers, Bloomberg noticed something: Billy Salomon was always the first to arrive each morning, but no one else in the trading room was there to keep him company.

So Bloomberg started showing up at 7 a.m. Billy needed a light, wanted to talk sports — there was no one else around, so they talked. Bloomberg also stayed the longest. When someone needed to call a major client after hours, when someone needed to listen to Billy complain about colleagues who'd already gone home — he was that person.

In the book, he says he never understood why others didn't do the same. It wasn't a burden; he enjoyed it. And "cultivating a close working relationship with the person in power probably didn't hurt his career."

This became the prototype for the company culture he later built at Bloomberg: show up, work, show up again.

Don't Make Five-Year Plans

Bloomberg spends considerable space in his book on his philosophy of work. One passage is worth quoting in full:

"Central planning didn't work for Stalin and Mao, and it doesn't work for entrepreneurs either. Every real advance I or my company has ever made has been incremental, not revolutionary. Earned step by small step, not achieved in one great leap of luck."

His logic: every day brings small, unexpected opportunities. Sometimes you catch one and it carries you to the top. But more often, it just moves you a little further forward. Success comes from stringing together many small steps forward — not waiting to win the lottery.

He never made comprehensive life plans. He writes that he didn't even know how to answer the college application question: "What do you plan to do in the next ten years?"

His approach: keep building skills, put in as much time as possible, plan a few tactical steps ahead — then adjust based on what actually happens.

This runs counter to most startup advice. But the history of Bloomberg's company — from terminals to news, from radio to television — vindicates the logic. None of the steps were planned in advance. Each one was built on the one before it.

Sell It First, Then Figure Out How to Build It

In 1982, Bloomberg's company had no product. He went to Merrill Lynch, pitched them on it, landed the first order, and promised delivery in six months.

Back at the office, his team went from elated to alarmed: the thing they'd committed to didn't exist.

The next six months were the most vivid stretch of the book — software bugs erupting constantly, sometimes forcing them to tear everything down and start over; Bloomberg shouting in the conference room "we're losing control, we're going to fail," then coming back the next day. When the Saturday they'd promised arrived and the product still wasn't ready, they told themselves: delivery doesn't have to be Saturday, it can be Monday — and Monday doesn't have to mean Monday morning, it can mean Monday afternoon.

They eventually delivered something "mostly functional, roughly as promised, more or less able to run."

That was enough. The product was in real users' hands, being scrutinized every day, improving every day. Merrill Lynch assigned two traders specifically to help with testing. Bloomberg would later call them among the most important contributors to the company's success: "They were demanding, but not unpleasantly so. They wanted us to succeed. When they said a feature didn't work, they could show you — so you knew it really didn't work, and you knew exactly when and why."

Merrill Lynch Turned $30 Million into $4.6 Billion

Merrill Lynch was Bloomberg's first customer and became his first major investor.

In 1982, they paid $30 million for a 30% stake. Fourteen years later, in 1996, Bloomberg bought back 10% for $200 million. Twelve years after that, in 2008, he bought back the remaining 20% for $4.4 billion.

Merrill Lynch collected roughly $4.6 billion in total — plus the invaluable feedback from those two traders they'd sent over to help sharpen the product.

Bloomberg's comment in the book is characteristically spare: "Not a bad return."

Every News Story Is a Product Demo

Wall Street Journal reporter Matt Winkler had been watching the Bloomberg terminal. He came looking for an interview. Bloomberg gave him a job offer instead: build a news division.

Bloomberg's logic was straightforward. As he writes: "Every story we published would demonstrate features of our terminal, making each piece more informative than competitors' coverage — which meant more people would want to read it, which brought more revenue, which funded more reporters, more stories, more revenue."

In plain terms: every article is an ad. Ads drive subscriptions. Subscriptions fund more ads.

He later applied the same logic to radio and television. When asked why Bloomberg was getting into media, he said the motive was never hidden — sell more terminal subscriptions. The people reached by broadcast — running, showering, driving, sitting at home — were potential Bloomberg terminal users. He needed to be where they were.

You Sell the Content, Not the Device That Carries It

When Bloomberg launched in 1982, he had to build his own hardware — the personal computers available at the time weren't good enough to run his product. His team would make their way into client offices on weekends, drilling holes, running cables, installing equipment with no regard for fire codes or building regulations. "Sometimes until 10, 11 at night — turning it on, watching something we created come to life. Very satisfying."

But he never lost sight of what kind of company he was building: content, not hardware.

When better hardware appeared, he dropped what he'd been building himself and let others make the devices. When the internet arrived, he moved his content there. When broadcast came along, he was there. When the next distribution format emerged, he'd be there too.

As he puts it in the book: "We don't do the hardware we 'have to' make. We do the content only we can provide."

Don't Play Fair

Bloomberg said something that Jeff Bezos would later echo in his own way.

Bloomberg: "I don't think business wars should be evenly matched. We don't want fair competition. We want to enter every fight with an advantage."

Bezos's version: "Do you really want to plan for a future where you might have to compete against someone just as strong as you? I don't."

Bloomberg's competitors were almost always much larger. His response wasn't to fight on equal footing — it was to find something they couldn't replicate: fifteen years of accumulated knowledge of the financial industry, earned from the inside at Salomon Brothers, and the ability to translate that knowledge into software. As he writes: "No one had more knowledge of the securities and investment industry, and no one had more knowledge of how technology could serve it."

That was his unfair advantage. He turned it into a company.

Why He Wouldn't Sell

Bloomberg has a candid passage in the book, delivered with his usual bluntness:

He admits that sometimes, surrounded by the trappings of success — profit, power, reputation — he'd feel restless and dream of starting from scratch. But something stopped him. Maybe age. Maybe fear that all of it had just been luck.

He wouldn't sell. After buying back the final 20% from Merrill Lynch in 2008, he writes: "Why would I go public? Why would I answer to more partners, shareholders, securities analysts? I understand why the investment bankers want me to issue stock. But why would we?"

His answer is a single sentence: Answering to no one is the best position to be in.

So he got back on the treadmill, raised the stakes, entered new media, launched new projects, and kept going.