|
 |
Charles Schwab: When Risk Leads to Profit
by Melissa Pringle
Business Programs Columnist
Is risk-taking worth it in a business career? Charles Schwab would likely say that it is. He took a risk, and ended up with a net worth of $4 billion.
|
Before 1975, only those with a lot of money could afford to trade stocks. The fixed commissions set by the brokerage industry kept prices high, until a mandate set by the Securities and Exchange Commission on May 1, 1975 forced brokerage companies to deregulate commissions. These commissions could now be set by market competition. One man, MBA graduate Charles Schwab, had the foresight to see potential in this deregulation, and through his business career, gained a net worth of $4 billion.
How did Charles Schwab start his business career?Charles Schwab started his business career by training for it. After graduating from Stanford University with a B.A. in Economics in 1959, he went on to earn an MBA from the Stanford Graduate School of Business, and graduated in 1961.
How did Charles Schwab make it to the top?
While other companies saw deregulation as a chance to raise their commission prices even higher, Charles Schwab saw it as an opportunity to appeal to common people rather than large companies. This MBA graduate became a pioneer in the brokerage industry in 1974, starting the first company to offer brokerage at discount prices. Initially this led to a loss in profits, but the lower cost of trading stocks led many consumers to the Charles Schwab Corporation, and profits skyrocketed.
Why is Charles Schwab a great business leader?
Between his undergraduate degree in economics and his MBA training, Charles Schwab got the right knowledge and took a risk to start what is today a multi-million dollar industry. His company pioneered more than just discount brokerage, as one of the first brokerages to offer national service on a 24-hour, 7-day-a-week basis. Throughout his business career, his company has expanded, and today it provides brokerage and other financial services, such as experts' top mutual fund picks and even mortgages, to over 7 million clients.
Charles Schwab Fast Facts:-
Quote: "…I've always felt that I had very strong conceptual capabilities. I could imagine things much faster than some other people who were stuck thinking sequentially. That helped me in solving complicated business problems."
-
Net Worth: $4 billion
-
Hometown: California
-
Education:
- Bachelor of Arts/Science in Economics, Stanford University
-
Master of Business Administration, Stanford Graduate School of Business
|
Sources
About the Author
Melissa Pringle is a freelance writer currently pursuing a master's degree in Spanish.
More Business Career Profiles
Steve Jobs: Business Marketing with Passion
Martha Stewart: The Business of Perfect Administration
Donald Trump: Rising from the Ashes
Rupert Murdoch: Media Titan
Inside Warren Buffett
Michael Bloomberg: Self-made Billionaire
Bill Gates: True Management
|
|
