BlackRock now has a higher percentage of engineers than JPMorgan, and it says a lot about the future of the money management industry

BlackRock now has a higher percentage of engineers than JPMorgan, and it says a lot about the future of the money management industry


BlackRock CEO Larry Fink.
Associated Press

About a quarter of BlackRock’s 14,000 employees work as technologists, the firm’s chief financial officer said Wednesday.That’s a higher percentage than at JPMorgan.Like its peers, BlackRock is betting on technology as a growth driver. BlackRock’s chief financial officer just disclosed a key figure that illustrates the importance of technology to the world’s largest asset manager. About a quarter of BlackRock’s 14,000 employees, or 3,500 people, work as technologists, BlackRock CFO Gary Shedlin said at an investor conference on Wednesday. That’s a higher percentage than the 20% of JPMorgan’s 250,000 employees who work in technology functions, but it still lags the 30% of Fidelity’s 40,000 employees who work in tech. Like its peers, BlackRock, which oversees $6.4 trillion in assets, is betting on technology as a growth driver. BlackRock’s signature technology product is Aladdin, an investment-management platform that touches $18 trillion of assets globally. Though technology services makes up just 6% of the firm’s revenue, which is largely dependent on fees paid for assets under management, the segment jumped 18% year-on-year for the third quarter to $200 million. The increase reflected “an outsized number of new clients sourced in 2017 and successfully implemented in the current year,” Shedlin said, noting that the firm was targeting low- to mid-teens growth for the technology business in the long term. Read more: Big asset managers are facing ‘intensifying headwinds’ with fees under pressure and market volatility on the upswing The firm has also picked up minority stakes in numerous financial-technology companies, including iCapital, Scalable Capital, and Acorn. Last week, the firm said it would buy a small interest in Envestnet, which will expand its reach in the financial-adviser community. BlackRock is spending about $1 billion annually in technology and data, Shedlin said. Earlier this year, JPMorgan Chase’s chief information officer said the firm was spending about $10.8 billion on technology, while Citigroup is dedicating about $8 billion. Morgan Stanley spends about $4 billion. Meanwhile, Fidelity spends about $2.5 billion annually on technology, research, and design, according to the firm’s website. A BlackRock representative declined to comment further on the firm’s tech spend. Read more: ‘Bite-size, usable, and shareable’: BlackRock’s CMO explains the $6.4 trillion giant’s digital rebrand How JPMorgan’s CIO decides which startups to partner with, which to invest in, and which to outright buy Citi has poached a Chase executive to run its ‘Shark Tank’-type program that lets employees build startups from within the company
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