Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: So, David Bondman, it's amazing to read about his impact
Speaker 2: on the broader investment world. He is a one of
Speaker 2: the best known names, one of the icons. You knew
Speaker 2: him better than anybody in this business. What specifically did
Speaker 2: he bring to this business that was unique to him?
Speaker 1: David really is a legend in the industry. But he's
Speaker 1: a legend for several reasons, and I think there's three
Speaker 1: particular things. First of all, he pioneered a type of investing. Secondly,
Speaker 1: he built a firm that had a distinctive place in
Speaker 1: the industry. And thirty had a really interesting personal style
Speaker 1: that I think helped evolve the style of this industry.
Speaker 1: And So what did he do, how did that work
Speaker 1: in practice?
Speaker 2: What was he doing as a deal maker that really
Speaker 2: set him apart?
Speaker 1: David did deal making as problem solving. So if you
Speaker 1: think about some of his signature deals, they were deals
Speaker 1: that everyone saw but no one else was willing to
Speaker 1: take on. And it wasn't that he was taking on
Speaker 1: more risk, it was that he saw something different. Take
Speaker 1: the Continental Airlines deal, a legendary deal in the industry,
Speaker 1: the most hated company in America, the biggest bankruptcy in
Speaker 1: US history had sat there for two years. Dave and
Speaker 1: I put together a deal that carved out a new
Speaker 1: continental and took it from worse to first in seven years.
Speaker 1: It was Warren Buffett said that airlines were financial sinkholes.
Speaker 1: David over and over made successful investments in airlines. When
Speaker 1: others saw the SNL crisis, David saw the SNL opportunity.
Speaker 1: We created the good bank bad bank structure for American
Speaker 1: savings when working with Bess, and then we exported that
Speaker 1: structure around the world to do bank rescues in China,
Speaker 1: in Korea, again deals that no one else did, and
Speaker 1: that a problem solving approach really appeared a moment that
Speaker 1: the industry was mostly about changing capital structures, not companies.
Speaker 2: All right, So you said something to me before we
Speaker 2: came on air which I found fascinating, which is that
Speaker 2: David was a polymath investor. The Blueberg audience is pretty smart,
Speaker 2: but you need to break this down what that actually
Speaker 2: means in practice.
Speaker 1: Poly Math is from the Greek and it's basically a
Speaker 1: person who has broad and diverse interests but uses that
Speaker 1: knowledge and interest to solve problems and So David really
Speaker 1: didn't come to investing until his forties. Yeah, think about that.
Speaker 1: He had several careers before he was a litigator. He
Speaker 1: was argued in front of the Supreme Court. He taught
Speaker 1: law Tulane, he studied Islamic law on Tunis. This was
Speaker 1: a person that never took a finance class, didn't know accounting,
Speaker 1: and yet he brought that broad experience and problem solving
Speaker 1: expertise to the problems of investing. And his ability to
Speaker 1: use different experiences he had to solve problems I think
Speaker 1: really created his style, and it's a polymass style. It
Speaker 1: was not one thing. It was a unique ability to
Speaker 1: see opportunity and frankly solve problems well.
Speaker 2: And it translated into him being, I have to say,
Speaker 2: one of those eclectic, maybe eccentric sort of figures in
Speaker 2: an industry that didn't always certainly the broader Wall Street
Speaker 2: doesn't always sort of embrace change.
Speaker 1: So how was he received in this broader Wall Street world?
Speaker 1: In your estimation, David was many things, but he was
Speaker 1: never boring. We used to laugh that David often brought
Speaker 1: like a rock and roll backbeat into rooms that were
Speaker 1: used to classical music. It was a very different style.
Speaker 1: He was known for his ridiculous socks. I mean they
Speaker 1: were just ridiculous. When others were drinking fine wine, he
Speaker 1: was drinking diet coke. He's flew one thousand hours a
Speaker 1: year to meetings anywhere. It's a very personal thing for him.
Speaker 1: And his style was informal, it was direct. He couldn't
Speaker 1: stand obfuscation. And that style was sort of a different
Speaker 1: a different wind in the industry at the time, and
Speaker 1: it opened up the opportunity for different types of styles
Speaker 1: to really flourish. It's an industry that had incredible talent
Speaker 1: among its founding brethren, but David brought I think a
Speaker 1: little bit of a different attitude and frankly, you know,
Speaker 1: a lot of fun into a very serious business. And
Speaker 1: so how do you be able to firm around that?
Speaker 2: I mean that you can be sort of a you know,
Speaker 2: sort of an iconoclast as a single person.
Speaker 1: You know, maybe as a small firm.
Speaker 2: You guys started out as three people in ninety two,
Speaker 2: ninety three, but now thousands of employees, quarter trillion dollars
Speaker 2: in assets. How does that sort of grow into something
Speaker 2: this big.
Speaker 1: I've been doing this long time. Culture and curiosity, so
Speaker 1: in some ways, what we described you and I about
Speaker 1: David became how you would describe PPG in some ways.
Speaker 1: At a time that the industry was very much about finance,
Speaker 1: was very much focused in New York. We came out
Speaker 1: of a family off in Texas. We set up on
Speaker 1: the West Coast. I used to say that when you
Speaker 1: do sports a lot, Jason, that we were playing the
Speaker 1: same game, but differently. We were the West Coast offense
Speaker 1: of private equity. And to do that you have to
Speaker 1: get a culture of curiosity and problem solving. And I
Speaker 1: think at the first fundraise we did for TPG, our
Speaker 1: tagline was contrarianism, complexity, and change. At a time the
Speaker 1: industry was more focused on franchise businesses and finance. Contrarianism, complexity,
Speaker 1: and change. And I think those lines of problem solving
Speaker 1: and a different approach really were what David brought to
Speaker 1: the business in the early days.
Speaker 2: Not afraid to take big swings, I mean, was that
Speaker 2: but part of his ethos do you think, like being
Speaker 2: able to really go big on something.
Speaker 1: It was never about ego or size. It was about
Speaker 1: really interesting problems and sometimes we got it wrong. Yeah,
Speaker 1: if you're doing this type of investing. You know, five
Speaker 1: percent of the time you'll make mistakes, and probably you
Speaker 1: should be making that sort of risk. But the key
Speaker 1: is never make the same mistakes if you can help it,
Speaker 1: and importantly learn from all of them. And David and
Speaker 1: I think our firm has been a lifelong learner on those.
Speaker 1: So I think somehow we've been able to grow with
Speaker 1: the industry but still keep some of that essence of
Speaker 1: doing it a little differently and looking at new deals.
Speaker 1: I mean even today, as you know, Jason, we've taken
Speaker 1: on impact investing, climate investing. These are new things, new problems,
Speaker 1: done in a new way, and that ethos I think
Speaker 1: was what we started with almost forty years ago, and
Speaker 1: we've tried to very much guard today.
Speaker 2: How did you build a partnership with him? You guys
Speaker 2: are not the same You showed up in Texas? You know,
Speaker 2: Dartmouth undergrad, Stanford Business School, He was a University of
Speaker 2: Washington bankruptcy lawyer, save Grand Central. How does that marriage
Speaker 2: of a sort happen?
Speaker 1: I think there's two types of partnerships. One are people
Speaker 1: who are very much the same, almost can complete each
Speaker 1: other's senses. The other type of partnership are people who
Speaker 1: are very different but share the same values. And I
Speaker 1: think David and I brought different skill sets, different views
Speaker 1: of the world, but values on fairness, the idea of
Speaker 1: you can leave the last cent on the table to
Speaker 1: create a win win, and we agreed on the type
Speaker 1: of firm and culture we wanted to build, so complimented
Speaker 1: each other, respected each other, but also brought some balance
Speaker 1: to the equation.
Speaker 2: How do you think he changed you as an investor
Speaker 2: and as an executive.
Speaker 1: I think David was, as well as being a great investor,
Speaker 1: simply a great business person. You know, he served on
Speaker 1: eighty different corporate boards. Who does that? Eighty different corporate boards,
Speaker 1: from GM to Dakati, from Behringer to Burger King. Immensely diverse,
Speaker 1: and that viewpoint, something that was often underestimated with David,
Speaker 1: really helped me be a better businessman. It's about being straightforward,
Speaker 1: about seeing different things. It's about patients from time to time,
Speaker 1: and even when things go wrong, you don't step back,
Speaker 1: you step in. So I think his polymath skills really
Speaker 1: extended into the business world.
Speaker 2: All right, I mentioned earlier this is a massive, massive
Speaker 2: industry at this point that what we used to call
Speaker 2: private equity, it's now alternative investing. These firms, including yours,
Speaker 2: are doing lots of different things.
Speaker 1: How do you take that Bonderman.
Speaker 2: Ethos, you know, the sort of like you know he's
Speaker 2: calling into an investment committee, meaning from Tim buck to
Speaker 2: to you know, now a publicly traded company. How do
Speaker 2: you maintain that essence? Because I know that culture is
Speaker 2: something that's important to you, you study it, how do
Speaker 2: you really institutionalize that culture fight conformity.
Speaker 1: In all ways? I think if you were starting this
Speaker 1: business today, sometimes I think the people who are looking
Speaker 1: at it feel they have to learn finance in their
Speaker 1: crip and have to go through internships. David came to this,
Speaker 1: as I said before ines, he brought that wide set
Speaker 1: of experiences, and I think the understanding that you can
Speaker 1: ask different questions, approach problems in different ways is something
Speaker 1: the industry needs to say true to today. So that spirit,
Speaker 1: the spirit of problem solving, curiosity, a little bit of
Speaker 1: courage put together with a broad view, is something the
Speaker 1: industry still needs to say. And I think the industry
Speaker 1: is delivering that immense talent in the industry. We have
Speaker 1: to just make sure that it's not delivered in one Way.
Speaker 2: And so as he sort of kind of moved on
Speaker 2: from the firm, and we'll talk a little bit about
Speaker 2: what he was doing in the latter years of his life.
Speaker 2: You know, how did you know, how did you sort
Speaker 2: of honor his legacy?
Speaker 1: How did he stay involved? Well, David always had broad
Speaker 1: interests and one of the interesting things about his career
Speaker 1: is he's mentored and spawned many businesses and helped many businesses,
Speaker 1: from Mark Lazari to Tom Barrick to Mark's Stad to
Speaker 1: Way Jan Sean. There are disciples around the industry that
Speaker 1: have picked up some of his investing style in ethos
Speaker 1: and he continued to do that as he continued to
Speaker 1: have a TPG as a cornerstone. But he went on,
Speaker 1: as you know, to be active in sports. And yes
Speaker 1: he had been an investor in the Celtics, but he
Speaker 1: did a typical Bondo thing. By the way, just the
Speaker 1: nickname Bondo was different in the industry. He did a
Speaker 1: typical Bondo thing, which is he took on a problem
Speaker 1: no one else would bringing back a team indoors in Seattle,
Speaker 1: rebuilt an arena where he had worked as a security
Speaker 1: guard when he was an undergrad at university of Washington,
Speaker 1: and we were listening there to TPG founding partner James
Speaker 1: Coulter reflecting on the life and legacy of his business
Speaker 1: partner David Bonderman, a legend in the world of private equity,
Speaker 1: who passed away yesterday at the age of eighty two.