Core Insights - The article highlights the evolution and impact of Vanguard Group, founded by John Bogle, who is recognized as the father of modern index funds. Vanguard has transformed the mutual fund industry and continues to lead in innovation and growth [1][9]. Group 1: Vanguard's Foundation and Growth - Vanguard's First Index Trust was launched in 1976 with an initial target of $150 million but only raised $11.3 million. Despite this, it has grown to manage over $8 trillion in assets, serving more than 30 million investors [1]. - John Bogle founded Vanguard at the age of 47, demonstrating that it is never too late to create a disruptive product or business model [9]. Group 2: Historical Context and Challenges - Bogle's early career at Wellington Fund revealed that actively managed funds underperformed the market averages by 1.6% annually. Wellington Fund, founded in 1928, managed $1.4 billion at the time of Bogle's joining [2]. - Wellington Fund faced significant challenges in the 1960s, with assets declining from $2 billion to $470 million, a drop of 75%. Bogle became CEO in 1970 but faced difficulties due to poor performance and a failed merger [3][4]. Group 3: The Rise of Index Funds - After being dismissed from Wellington, Bogle focused on creating a low-cost, efficient investment strategy, leading to the establishment of Vanguard in 1974. The first index fund was launched, which later proved to be a successful investment vehicle [6]. - Over the next 30 years, the S&P 500 achieved an annualized return of 11.3%, while actively managed funds returned only 9.7%. Vanguard's First Index Investment Trust grew to $600 million in its first decade [7][8]. Group 4: Vanguard's Market Position - Today, index funds account for 30% of the overall market size, with Vanguard's inflows in 2016 reaching $289 billion, surpassing the total inflows of 4,000 global funds combined [9].