Few industries have seen as many acquisitions, mergers, and name changes as the American stock brokerage and investment banking industries. Perhaps only the equally old railroad industry has seen more such activity. These firms have been called wire houses (with offices all over America), brokerages, and investment banks. Specialties and related fields include regional firms, boutique firms, industry specialists, private equity firms, mutual funds, and investment management firms.
In this article, we begin a major effort to sort out these histories and consolidate them into one source, something we cannot find anywhere on the Internet. In fact, few complete industry histories of any industry exist online or in book form. Doing it right is a major research challenge, but one appropriate for the American Business History Center, in the same spirit that we compiled the evolution of the largest commercial (not investment) banks.
Thousands of such firms have existed over the decades. It would be nearly impossible to list them all. Here we focus on about ninety of the largest and best-known names. With this article, we just dip our toe in the water, covering the first one-third of our list – those starting with the letters A through G. Over the next several weeks, we hope to finish the rest of the names on our list.
These short notes focus on the founding dates, mergers, and name changes in the industry. More complete histories are needed for all these firms, fully reflecting their ups and downs, innovations, scandals and controversies, and key people. In some cases, whole books have been written about them, especially Goldman Sachs.
One might wonder why this industry has had such a high rate of change. Here are some possible reasons:
- Sometimes these firms make big bets on a single investment type, such as subprime mortgages, or focus on Initial Public Offerings (IPOs), which at times dry up. They can get into financial trouble and need to be acquired to be bailed out.
- Or, if the market is hot, the owners decide to “get out while the getting is good.”
- This business is really one of personal relationships. If a key partner or top salesperson leaves, or a group of them, it may be time to sell. The underlying organization, branch structure, or brand name are often not as valuable as the individual talents.
- As financial people, the partners and executives may be more interested in making money, sometimes quickly, than building a business that will be around “forever,” maintaining its independence.
Since our focus is on deep history and forgotten brands, we have not covered the many “more recent” entrants into the industry, including:
- American banks including Bank of America, JP Morgan Chase, Wells Fargo, Wachovia and many others. These commercial banks were banned from being in the investment banking business by the Glass-Steagall act of 1933, but that was gradually relaxed and effectively dead by 1999.
- Foreign banks and insurance companies, primarily from Europe, especially Switzerland (such as UBS and Credit Suisse), but also from Asia.
- Online “upstarts” like Charles Schwab, Ameritrade, Scottrade, E*Trade, and Robinhood.
- Mutual fund companies including Fidelity and Vanguard.
Here are some general notes and caveats when going through the list, or searching for your old stockbroker:
- Most all are or were New York based, unless noted otherwise.
- Most had several different names and we had to pick one to use for our entry.
- We have tried to alphabetize them correctly, usually using the last name if the firm’s name was a person’s name, with some exceptions like Dean Witter, listed here under D. This is an inexact process, so you may have to search around.
- Many entries refer to being acquired by another firm which is beyond the letter G and thus not in this first third of our research. You will have to wait until the next two parts are completed to get the full story to know where the company finally ended up.
- To search for a specific firm name in this article, use Control-F in Windows or Command-F on a Mac.
- Our starter list came from the lead underwriters of the Ford Initial Public Offering (IPO) in 1956, the biggest IPO in history at the time, and from a secondary offering of McDonald’s stock in 1972.
- We have cobbled this information together from multiple sources, including Wikipedia, which means there is some risk of inaccuracy. If you have better information or links, please use the contact form to send them to us!
With those points in mind, here are the first firms we have tackled so far:
AC Allyn – Chicago-based firm merged with Francis I. DuPont in 1963; the Allyn family also owned the Chicago White Sox baseball team.
Allen & Company (still operating) – Founded in 1922, this private firm has a reputation for specializing in the real estate, media, and entertainment industries.
American Securities – Listed as an underwriter in the 1956 Ford Motor IPO, this may be the company that was originally the “family office” for investing the wealth of the Rosenwald family, the children of Julius Rosenwald who built Sears, Roebuck and was its primary owner. If that is the same firm, it is the one that continues today as a private equity firm.
Bache & Co. – Founded in 1879 as Leopold Cahn, it was taken over and renamed in 1892 by employee (and Cahn’s nephew) Jules Bache. In 1890, the New York-based company had established a branch in Albany, with the first direct wire connection to a distant branch by any US investment bank. Early clients included John Rockefeller, Edward Harriman, and Jay Gould. Before the crash of 1929, Bache limited credit extension to its customers and told them there might be a market reversal. The firm had none of their funds invested in the market at the time of the crash, enabling it to remain strong, even loaning customers money in the Great Depression. By the mid-1960s, Bache was a major “wire house,” with offices throughout the United States, and the second largest firm after Merrill, Lynch. In 1981, Prudential Insurance bought Bache. The retail investment business was merged with those of the Wachovia Bank to form Wachovia Securities in 2003. The commodities trading and other parts of the business were bought by Jefferies in 2011, but in 2015 they sold the commodities operations to the French Société Générale.
Robert W. Baird (still operating) – Founded in 1919 as the securities arm of the First Wisconsin National Bank, it became independent under Glass-Steagall in 1934 and was renamed Securities Company of Milwaukee. When the firm joined the New York Stock Exchange in 1948, it took the name of its lead partner, Robert W. Baird. With revenues exceeding a billion dollars a year, the now-international firm is still based in Milwaukee.
Bear, Stearns – Founded in 1923, Bear Stearns became a major trading and investment company, reaching over 15,000 employees by 2007. But the firm was over-exposed to “subprime” mortgages and collapsed in 2008. JP Morgan Chase bought the remains for $10 a share, down from a 2007 peak of $172.
AG Becker – Chicago firm founded in 1893, bought my Merrill Lynch in 1984.
William Blair & Co. (still operating) – This Chicago-based firm, founded in 1935, is still going strong, with about $100 billion in assets under management for its clients.
Blyth & Co. – Founded in 1914 in San Francisco by Charles Blyth and Dean Witter, the firm was renamed Blyth & Co. when Witter left to set up his own firm, Dean Witter, in 1924. In 1972, Blyth merged with Eastman Dillon Union Securities to form Blyth, Eastman, Dillon, which in turn merged with Paine Webber in 1979.
Alex. Brown & Sons – Irish linen merchant Alexander Brown emigrated to Baltimore in 1800, where he established America’s first investment bank. In 1808, the company underwrote the nation’s first Initial Public Offering (IPO), for the Baltimore Water Company. In 1997, Alex. Brown was purchased by Bankers Trust; in 1999, those investment operations were acquired by the German Deutsche Bank, which in turn sold them to Raymond James in 2016, which still uses the Alex. Brown brand.
Butcher & Sherrerd – Philadelphia firm established in 1910, later became Butcher & Singer, bought by Wheat First in 1988.
Cantor Fitzgerald (still operating) – Founded in 1945, this firm focuses on institutional clients. Formerly headquartered in New York’s World Trade Center, 658 of the company’s 960 New York employees were killed in the attacks of September 11, 2001. The firm voluntarily provided $180 million in health benefits to the families of their lost employees.
CBWL-Hayden, Stone – In 1970, old line firm Hayden, Stone (founded 1892) was purchased by Cogan, Berlind, Weill & Levitt, whose partners included future SEC (Securities and Exchange Commission) Chairman Arthur Levitt and Sandy Weill, who eventually took over Citigroup (Citibank). In 1974, that firm (again renamed Hayden, Stone) merged with Shearson, Hammill, to form Shearson Hayden Stone.
Clark, Dodge – Founded in New York in 1845 by Philadelphians Enoch Clark and Edward Dodge, who had been investment partners since 1837. Kidder, Peabody acquired the firm in 1974. The Clark Dodge Asset Management company was formed in 2010 and claims the older business as its heritage.
Cowen (still operating) – Founded in 1918 as a bond trading house, Cowen was purchased by the French Société Générale in 1998, renamed SG Cowen. In 2006 it was spun out via an Initial Public Offering (IPO) and again named Cowen & Company.
Dain, Kalman & Quail – Begun as JM Dain in 1929, this Minneapolis firm merged with Kalman & Company and Quail & Company in 1967. After many acquisitions, the company became Dain Bosworth in 1979. In 1981, they acquired Texas’s largest regional brokerage, Rauscher Pierce Refsnes, which had been founded in 1933 from the investment banking arm of Dallas’s Mercantile National Bank. Dain Rauscher Wessels came into being in 1998 due to yet another acquisition. The firm was acquired by the Royal Bank of Canada in 2000, which soon also bought Boston’s Tucker, Anthony and San Francisco’s Sutro & Company. The whole group became RBC Dain Rauscher in 2002. In 2008, this became RBC Wealth Management, focused on asset management like some of the other firms in this list.
Dean Witter – Dean G. Witter and Witter family members founded this San Francisco firm in 1924 after Witter left his partnership with Charles Blyth. In 1978, the firm merged with Reynolds Securities to form Dean Witter Reynolds Organization, Inc. That firm was then the fifth-largest US brokerage and the first to have offices in all 50 states. It was acquired by Sears, Roebuck in 1981 as part of that company’s efforts to expand its financial services offerings. In 1986, Sears/Dean Witter created the Discover credit card. In 1993, Sears spun out Dean Witter, Discover & Co. In 1997, that firm merged with Morgan Stanley to form Morgan Stanley Dean Witter & Discover Co. The Dean Witter retail brokerage operations were transferred to Morgan Stanley Smith Barney, initially a joint venture with Citigroup, in 2009. Today it is wholly owned by Morgan Stanley, part of their Wealth Management operations.
Dillon, Read – Founded in 1832 at Carpenter & Vermilye, the firm sold war bonds during the Civil War. In 1905 it was renamed William A. Read after its principal partner, then Dillon, Read in 1921 when Clarence Dillon joined the firm. The company was purchased by The Travelers Companies (insurance) in 1986, then by the British Barings in 1991. In 1997 Swiss Bank Corporation bought the firm, merging it with SG Warburg to become Warburg Dillon Read. When UBS bought Swiss Bank in 1998, it became part of UBS, and the Dillon Read name was dropped by 2000.
Dominick & Dominick (still operating) – Founded in 1870 as Dominick & Dickerman, this firm became Dominick & Dominick in 1899. They merged with A. Iselin & Co., which dated from 1868, in 1936. In 2015, the firm was renamed Dominick & Dickerman.
Donaldson, Lufkin, & Jenrette – This innovative firm was founded in 1959 as a boutique research firm and gradually became a major underwriter of equity (stock) issues. It was acquired in 2000 by Credit Suisse (First Boston).
Drexel Burnham & Co. – In 1935, “Tubby” Burnham, a Wharton graduate who borrowed most of the money from his grandfather who had founded a Kentucky distillery, founded Burnham & Co. In 1973, the firm merged with Drexel Firestone, becoming Drexel Burnham & Co. Three years later, in 1976, they merged with William D. Witter, also known as Lambert Brussels Witter, then becoming Drexel Burnham Lambert. This firm became very active in the “junk bond” market under lead bond dealer Michael Milken. Aggressive policies and sometimes questionable activities led to the 1990 bankruptcy of the firm and a prison sentence for Milken.
Drexel Firestone – This Philadelphia-based firm was founded in 1838 as Drexel & Co. by Francis Drexel. His son Anthony J. merged the firm with JP Morgan to form the powerful Drexel, Morgan & Co. in 1871 (renamed JP Morgan & Co. in 1895 after Drexel’s death). In 1940, a group of the firm’s former partners formed a new investment bank and acquired the rights to the old name, Drexel & Co. In 1965, that firm merged with Harriman, Ripley & Co. In the 1970s, the Firestone Tire & Rubber Company bought a stake in the firm and it was renamed Drexel Firestone, which merged with Burnham & Co in 1973 to form Drexel Burnham.
Duff & Phelps (still operating) – This firm was founded in 1932 as an investment research firm, later branching out into credit ratings and corporate finance. In recent decades, the firm has made numerous acquisitions in financial services, and has been owned by its employees in conjunction with a series of private equity firms.
duPont Glore Forgan – This firm was created in 1970 by the merger of Francis I. duPont (founded in 1931 by a member of the duPont chemicals family) with Glore Forgan Staats. Glore, Forgan was founded in 1937 in Chicago and William R. Staats in California in 1894; those two firms merged in 1965. In 1973 duPont Glore Forgan merged with Walston & Co., one of the largest brokerage firms in America, which was owned by Ross Perot, to become DuPont Walston. The firm then collapsed a year later, in 1974.
Eastman Dillon, Union Securities – Union Securities was created in 1938 but was descended from J&W Seligman, one of the oldest investment banks, with roots going back to 1846. In 1956, they merged with Eastman, Dillon, another major firm, founded in Pennsylvania in 1912. The new firm, Eastman Dillon, Union Securities, merged with Blyth in 1972 to form Blyth Eastman Dillon, and that firm was acquired by Paine, Webber in 1979.
F. Eberstadt – Founded in 1931 by former Dillon, Read partner Ferdinand Eberstadt, the firm was a 1930s pioneer in offering mutual funds and an early innovator in leveraged buyouts. The British Robert Fleming Investment bank bought Eberstadt in 1985.
AG Edwards – Founded in St. Louis in 1887, over the next 120 years the firm expanded to over 700 offices. Wachovia (bank) purchased the firm in 2007. The next year, another bank, Wells Fargo, bought Wachovia, resulting in the old Edwards operations becoming part of Wells Fargo Advisors and Wells Fargo Investments.
Equitable Securities – Founded in Nashville in 1930, this firm grew to be one of the largest investment banks before being purchased by American Express in 1968. A group of employees then bought the name and assets, making it independent again, but the firm was again acquired, this time by Suntrust Banks, in 1997.
Financo (still operating)—Founded in 1971 by Gilbert Harrison, this boutique firm is known for its specialization in the retail industry. From 1985 to 1989, it was owned by Shearson Lehman Brothers, at that time owned by American Express, but then again became an independent firm, which it remains today.
First Boston – This firm was created in 1932 when the First National Bank of Boston was required to separate its investment banking activities by the Glass-Steagall Act. In 1946 they acquired the Mellon Securities Corporation, which was likewise spun out from Pittsburgh’s Mellon Bank. By 1970, the firm was considered one of the top investment banks alongside Morgan Stanley, Dillon Read, and Kuhn Loeb. In 1990, longtime partner Credit Suisse bought control and the company became Credit Suisse First Boston or CSFB. That firm bought Donaldson, Lufkin, and Jenrette in 2000. Credit Suisse dropped the First Boston name by 2006.
Goldman Sachs (still operating) – Considered by many to be the premiere American investment bank, Goldman Sachs was founded in New York City in 1869 by Marcus Goldman and adopted its name when his son-in-law Samuel Sachs joined the firm in 1882. The firm was a pioneer in commercial paper financing and in taking non-railroad companies public, including Sears, Roebuck in 1906. Goldman alumni and chief partners have played a major role in the US economy, from serving as Secretary of the Treasury (Robert Rubin) to US Senator (Jon Corzine).
For what it is worth, this is our working list for future entries. We reserve the right to add, subtract, rename, or combine these entries as we research them more deeply:
- Hallgarten & Co.
- Halsey, Stuart
- WR Hambrecht (still operating)
- Harriman Ripley
- Hayden, Stone
- Hemphill, Noyes
- Hornblower & Weeks
- Hornblower & Weeks-Hemphill Noyes
- Houlihan Lokey (still operating)
- EF Hutton
- WF Hutton
- Jefferies & Co. (still operating)
- Edward Jones (still operating)
- Keefe, Bruyette, & Woods (still operating)
- Kidder, Peabody
- Kuhn, Loeb
- Ladenburg Thalmann (still operating)
- WC Langley
- Lazard (still operating)
- Lazard Freres
- Lee Higginson
- Legg, Mason
- Lehman Brothers
- Carl M. Loeb, Rhoades
- McDonald & Co.
- Merrill, Lynch, Pierce, Fenner, & Beane/Smith
- Mitchell, Hutchins
- Montgomery & Co. (still operating)
- Morgan Keegan (still operating)
- Morgan Stanley (still operating)
- FS Moseley
- Needham & Co. (still operating)
- Paine, Webber, Jackson, & Curtis
- Piper Jaffray (still operating)
- RW Pressprich
- Raymond James (still operating)
- Reynolds & Co.
- LF Rothschild
- Salamon Brothers & Hutzler
- Shearson, Hammill
- Shields & Co.
- Smith, Barney
- FS Smithers
- Spencer Trask
- Stephens (still operating)
- Stifel Financial (still operating)
- Stone & Webster
- Thomson & McKinnon Auchincloss
- Tucker, Anthony
- Union Securities
- CE Unterberg, Towbin
- GH Walker
- Walston & Co.
- Watling, Lerchen
- Wertheim & Co.
- Wheat First
- White, Weld
- Wood, Struthers
- Wood, Struthers & Winthrop
- BC Zeigler
American Business History Center
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