9. Jack Bogle

Benjamin Wachenje

Founder and former CEO, The Vanguard Group
Born: May 8, 1929, Montclair, N.J.
Education: Bachelor's in economics, Princeton University

Index mutual funds are so common today that it's nearly impossible to believe the ridicule John C. "Jack" Bogle got when he created the first one almost 40 years ago. "Bogle's Folly" was the printable epithet hurled from the corner of Wall Street that his move upended.

Bogle was telling professional money managers something dangerous—that individual investors no longer had to put up with being overcharged for mutual funds that underperformed the market. Instead, they would be better off buying and holding the broad market rather than endlessly running after hot stocks. Such a challenge was "un-American," one outraged critic charged.

It is the visionary's lot to suffer such condemnation. Bogle's lasted a while.Though he founded The Vanguard Group in 1974 and launched the first retail index fund about two years later, he makes our anniversary list of the 25 transformative leaders, icons and rebels of the past quarter-century because it wasn't until 1990 that index funds took root—thanks largely to Bogle's evangelism.

Bogle was finally validated in the money management industry's eyes that year, with his Vanguard 500 Index fund getting its first direct competitor when Fidelity Investments launched its first index funds. Now, a third of households with a mutual fund own an indexed fund. They have also attracted a new cohort of female and younger investors that traditional money managers had neglected.

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From his research for his undergraduate thesis at Princeton, Bogle knew that most mutual fund managers underperform the market. And the overwhelmingly majority of the few professional money managers who did beat the market in any particular year struggled to repeat their success. Transaction and management fees ate into investors' returns even further. Long term, Bogle reasoned, investors would be better served by buying and holding a low-cost, diversified portfolio of stocks mimicking the broader market. Such a fund eliminated the need for high-priced stock pickers and heavy portfolio turnover, and it would beat an actively managed one on an after-cost basis.

On the last day of 1975, Vanguard launched the First Index Investment Trust, which tracked the S&P 500. Later renamed the Vanguard 500 Index Fund, it started with meager assets of $11 million, a fraction of the $50 million to $150 million Bogle had hoped for—and not even enough to buy every stock in the index. But the trek through the wilderness had begun.

Vanguard eventually emerged as the world's second-largest mutual fund company. The Vanguard 500 Index Fund hit the milestone of $100 billion in assets in 1999 and overtook the actively managed Magellan Fund as the world's largest mutual fund the following year. In 2011, it crossed the $200 billion in assets mark. By then, there were 383 index funds in the U.S., managing total assets of $1.1 trillion. Bogle had moved beyond tracking the S&P 500 and into a raft of funds mimicking domestic and international indexes, and to bonds and equities.

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Vanguard now has assets of $2 trillion—the same aggregate size as U.S. hedge funds—that it manages in mutual and exchange-traded funds, a fund variant that trades in real time as opposed to being priced at the end of the day as mutual funds are. As of the end of the first quarter of 2014, ETFs had nearly $3 trillion in assets.

Bogle remained CEO of Vanguard until 1996 and chairman until 1999, when he reached Vanguard's mandatory retirement age of 70. The later years were marked by a falling out with his hand-picked successor, John Brennan, who introduced sector funds—too close to chasing hot stocks for Bogle's taste.

Vanguard also differs from other Wall Street asset managers in that it is owned by its funds, not by investors.

"Putting the mutual back in mutual funds," as Bogle once put it. Such a structure let Vanguard pass on the benefits of extremely low operating and management costs to shareholders. As he has said on many occasions, and to the enormous benefit of millions of individual investors over the past 25 years, "Costs matter."

Jack Bogle: Lifelong highlights

• Described his thesis as "prepared by a callow and idealistic young scholarship student working his way through a great university"
• Acknowledges the work of John A. McQuown and William L. Fouse in developing indexing techniques that let Wells Fargo Bank build a short-lived $6 million index account for Samsonite's pension fund
• Has said Vanguard wouldn't exist had he not been fired from Wellington Management for approving an "extremely unwise" merger
• Published investing classic, "Common Sense on Mutual Funds: New Imperatives for the Intelligent Investor," in 1999
• Followed by legions of individual investors known as Bogleheads
• Founded the Bogle Financial Markets Research Center, of which he is president, in 2000

Read MoreFULL LIST: CNBC FIRST 25