This article concerns Vanguard, the company, not its funds and ETFs. While it may not have implications for your portfolio today, I believe in keeping tabs on the company we’ve entrusted with our hard-earned dollars.

What does it mean to be a Vanguard owner? It’s a question I find myself asking more and more these days.

A recent catalyst for the question was the Bloomberg article Planet Boglehead: Vanguard Struggles to Win Over the World.

For those who can’t access the article, Loukia Gyftopoulou (the author) describes Vanguard’s struggles to expand in foreign markets. Her story isn’t flattering—Vanguard has been misreading markets, chopping and changing strategies, opening and closing offices, and all the while they’ve been dealing with high employee turnover. On top of that, the “powers that be” in Malvern, PA, are said to want to see results (asset growth) sooner rather than later.

Here are two key quotes from the article:

Vanguard, meantime, has been spending many millions to expand its reach from the Baltic to the Mediterranean […] And yet the payoff – or at least one big enough to move the needle back in Pennsylvania – remains elusive.
Mortimer “Tim” Buckley, the former Bogle assistant who runs Vanguard Group, at some point has to show his board that the long, costly push into Europe will pay dividends.

As I read this article, my first reaction was, “What’s the rush?!” Vanguard is already a behemoth, with over $7 trillion in assets and over 20% market share, but the firm was not an overnight success. It took decades of consistent messaging (and Jack Bogle’s media savvy) for Vanguard to get where it is today.

Why would Buckley and company expect to achieve anywhere near the same level of success in a new market, far from home, in such short order? I’m on the record saying that Vanguard’s playbook will work overseas, but it will take time, and there’s no guarantee that Vanguard itself will be the one to achieve success with that playbook.

My second thought … Wait, whose millions is Vanguard spending in this rush to expand into foreign markets?

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