Speaker 1: Bloomberg Audio Studios, podcasts, radio News.
Speaker 2: Thank you both for sitting down with me, and first
Speaker 2: of all, congratulations. I know people will be viewing this
Speaker 2: after the race, but you've got to collectively a poll
Speaker 2: and a sprint win.
Speaker 3: Oh it's amazing. It's very easy.
Speaker 2: How is it to see the car yet again with
Speaker 2: the Carlisle name on it?
Speaker 1: It's just every time it's exciting. It's like a kid
Speaker 1: opening a gift and there it is. There's your toy.
Speaker 1: Except this is an extraordinary toy that they spend years
Speaker 1: building and then they just keep winning and winning and winning.
Speaker 2: It's a big toy and expensive toy, and I have
Speaker 2: to say it does have this element that it feels
Speaker 2: like a different Carlisle. Typically a Carlisle that operates behind
Speaker 2: the scenes working with institutional investors. But this is big,
Speaker 2: This is splashy, not to mention expensive. Why put yourself
Speaker 2: out there like this?
Speaker 1: Well, if you think about the evolution of finance the
Speaker 1: last thirty years, you've seen a remarkable development of prime markets.
Speaker 1: Private markets are really the primary source of capital for
Speaker 1: many companies. As that capital continues to grow, the market
Speaker 1: has just evolved to a place where wealth retail. The
Speaker 1: breath of what we do globally is just evolved also,
Speaker 1: and this is just part of the natural evolution.
Speaker 3: While it might feel.
Speaker 1: Unique now, I think it's actually not revolutionary at all.
Speaker 3: It's really just quite evolutionary.
Speaker 2: And why move that way With bread bull specifically?
Speaker 1: That was pretty easy. Everything about Oracle red bull Racing
Speaker 1: is about performance, execution, excellence, So that part was very
Speaker 1: easy to see and very easy.
Speaker 3: To relate to as a firm.
Speaker 1: The sport of one is also global and growing dramatically
Speaker 1: as we know, as are private markets, and so that
Speaker 1: all aligned. What made this really special was when Laurent
Speaker 1: and I spent time together, the teams spend time together,
Speaker 1: and it was almost like this sort of a very,
Speaker 1: i don't know, uniquely natural affinity where we all just
Speaker 1: became best friends really quickly, and and so hey, it's
Speaker 1: got to be fun too, But it is about performance
Speaker 1: excellence first and foremost.
Speaker 2: I was going to say, Laurn, given what Harvey is
Speaker 2: saying that the finance world in general has been more
Speaker 2: interested in sport, more interested in f one, have you
Speaker 2: been fielding a lot of calls before this partnership from
Speaker 2: Harvey's peers who wanted to get in like he did.
Speaker 4: You know, in reality, no, it felt it felt very
Speaker 4: natural straight away with Carlisle. With Harvey, you know, it's
Speaker 4: this moment where you realize that as a person you
Speaker 4: are talking with are the best at what they do
Speaker 4: in the world. And you know, we feel we are
Speaker 4: quite good at what we do, and what we see
Speaker 4: with our partners is that we go and try to
Speaker 4: partners with companies that are the best at what they do.
Speaker 4: And we had a lot more points of connections were
Speaker 4: we had these performance obsessions. We have this data driven
Speaker 4: approach in our very different business, but together with that
Speaker 4: quest for perfections in everything we are doing, it felt
Speaker 4: like very very That's what collections, to.
Speaker 2: Be fair, Harvey. There have been some outspoken critics about
Speaker 2: the move for private capital to do sponsorships to get
Speaker 2: invested in sports. Josh Easterly of Sixth Street said at
Speaker 2: a conference a couple of weeks ago it's representative to
Speaker 2: him that firms are more concentrated on fine tuning their
Speaker 2: brand than on the returns themselves. What do you say
Speaker 2: to that criticism.
Speaker 1: Our business is exactly where they'ren't just described it. It's
Speaker 1: first and foremost always about performance. Performance drives everything. If
Speaker 1: you have performance, you have success. Again, you think about
Speaker 1: everything they do at Oracle Red Bull Racing, it's all
Speaker 1: oriented around success. When he references data, we think about data.
Speaker 1: It's different data. But these are organizations driven around performance excellence.
Speaker 1: If you don't have performance, you don't have success. In
Speaker 1: terms of the partnership here, yeah, this is important to
Speaker 1: be able to reach a global audience. You know, you
Speaker 1: mentioned sport before. There's a real desire in the world
Speaker 1: for people to come together around sport and this is
Speaker 1: truly one of the fastest growing sports in the world,
Speaker 1: and so it's all very synergistic.
Speaker 3: But you don't have success with that performance. You can't
Speaker 3: sacrifice it. It has to stay number one.
Speaker 2: Well, the concentration of the sport, it's growing quickly. Apple
Speaker 2: now a US partnership with f one. But again, there
Speaker 2: is so much institutional money coming in, whether it be
Speaker 2: Carlisle sponsorship, whether it be other private capital firms taking
Speaker 2: investments in the team itself. What has that money done
Speaker 2: to change the sport?
Speaker 4: Lare on You know, I think as a sport we
Speaker 4: have spent years and decades to try to have a
Speaker 4: more global reach. You know, we have been trying to
Speaker 4: reach out to our fans, We've been trying to reach
Speaker 4: out to the businesses, and finally it seems that we
Speaker 4: are now having that incredible growth. You after you reach,
Speaker 4: we reach more fans, more global audience. We have now
Speaker 4: forty percent of our global audience in Formula one is female,
Speaker 4: forty percent that is under thirty five years old. And
Speaker 4: you know, we also had that common point of connections
Speaker 4: with Carolan. With Ave, they are trying to to get
Speaker 4: private markets to have that burder reach, and Phonua one
Speaker 4: is also trying to get set order reach towards a
Speaker 4: bigger fan base, and we are enjoying that. As a PRS,
Speaker 4: we worked a lot to be closer to our funds
Speaker 4: and you are right, there is so much more coming.
Speaker 4: We feel we are only at the beginning, especially in
Speaker 4: the US, in terms of reaching out to the wider audience.
Speaker 2: It's a fair point. This growth is happening to both
Speaker 2: of your industries at the same time, Harvey, that growth
Speaker 2: also coincides with you taking over the leadership of Carlisle
Speaker 2: in early twenty twenty three. It does feel like a
Speaker 2: different mindset coming from people institutions coming to buy funds
Speaker 2: versus you now having to sell them as well to.
Speaker 3: A broader audience.
Speaker 2: Is this a big cultural shift you think that you're
Speaker 2: leading at Carlisle? Is this a Carlisle two point out?
Speaker 1: Well, I think again, if you think about it's an
Speaker 1: incredibly competitive world out there. All organizations have to go
Speaker 1: through constant processes of self analytics, really being humble, asking themselves, Hey,
Speaker 1: what can we do better tomorrow? What can we do
Speaker 1: better for any client we serve around the world, whether
Speaker 1: it's a wealthy individual outside of the United States or.
Speaker 3: A future retirement.
Speaker 1: An individual planning for retirement in the United States when
Speaker 1: no rules change. And so no, I don't know if
Speaker 1: you're ever through your two point zeros. I think as
Speaker 1: a leader of any organization, you constantly have to be
Speaker 1: working with your teams to say, hey, on any given day,
Speaker 1: what can we learn, what can.
Speaker 3: We do better? And who can we serve better?
Speaker 1: And so again, I don't view that any of that
Speaker 1: as revolutionary. I just think of that as evolutionary. Now,
Speaker 1: the firm, as you point out, has been on a
Speaker 1: strong growth trajectory since I've shown up.
Speaker 3: The team's really rally They've gone an extraordinary job. I'm
Speaker 3: really quite proud of everything they've done.
Speaker 2: Is it a cultural shift, though, to go from institutions
Speaker 2: to have to think about retail and wealth.
Speaker 1: I wouldn't say it's a cultural shift because at the
Speaker 1: core of everything that is culturally relevant is performance. What
Speaker 1: I would say is understanding that end client. So you
Speaker 1: see a lot in the news today about retirement. It's
Speaker 1: not really even a sensible question to me whether retirees
Speaker 1: in the United States should have access to private markets.
Speaker 1: Firefighters millions of them, teachers millions of them have had
Speaker 1: access to these solutions through their pension plans. What is
Speaker 1: relevant is how do you structure them, how do you
Speaker 1: work with regulators to get it correct. So the real
Speaker 1: issue about extending private markets more broadly around the world
Speaker 1: to different clients is just getting it right.
Speaker 3: But it makes total sense.
Speaker 1: You know, since two thousand, we've lost half the public
Speaker 1: companies in the world.
Speaker 3: So private markets are the market that.
Speaker 1: People want to allocate capital to, and they shouldn't They
Speaker 1: shouldn't be deny that opportunity. We just as an industry
Speaker 1: have to be really thoughtful about how we deliver it right.
Speaker 2: Well, you coming in as leader, maybe there are some
Speaker 2: things that also mirror each other. Coming in when there's
Speaker 2: some tumult at the top, when there's maybe questions of leadership, Lauren,
Speaker 2: you've had to do that this year as well. Has
Speaker 2: Harvey given you any advice of what it's like to
Speaker 2: come in as a leader when there are questions surrounding past.
Speaker 4: Leadership, of course, of course absolutely, And you know it
Speaker 4: even goes beyond. You know, when we say why do
Speaker 4: we why do we partner with Calai? We partners with
Speaker 4: companies so that we can have that challenge, We can
Speaker 4: have that exchange about leaderships, about.
Speaker 2: What we have to know. What the advice was, We
Speaker 2: need to see behind the behind the scenes.
Speaker 4: You know, the behind the scene advice is as simple
Speaker 4: as that. You know, it's all about performance, and performance
Speaker 4: only comes from people. So get your people in the
Speaker 4: right conditions to work. Get them in, give them the
Speaker 4: possibility to express their talents. Make sure they have the
Speaker 4: right working environment for them to operate at best. That's
Speaker 4: what they do, that's what we do. That was one
Speaker 4: of his first advice. All of that is happening in
Speaker 4: an incredibly technological environment and data reveal you.
Speaker 2: Were also coming from racing balls where you were having
Speaker 2: a lot of success with the team, even our performing
Speaker 2: the team at certain points too. Was it a hard
Speaker 2: decision to make to come over to Red Bull or
Speaker 2: was it even a choice at all?
Speaker 4: You know, I think it was an incredible owner. You know,
Speaker 4: to receive that call, the first the first feeling you
Speaker 4: get is it is Red Bull asking you to step up.
Speaker 4: There there is a sense of loyalty towards the company,
Speaker 4: so of course it was it was you know, it
Speaker 4: was a big news and a big surprise, but it's
Speaker 4: also something that you know you have to jump into
Speaker 4: as part of the loyalty you have with the group,
Speaker 4: and you know it's an incredible owner and privileged to
Speaker 4: be part of a team that has been winning so
Speaker 4: much in such a competitive environment in the last two decades.
Speaker 1: Spill mis leaders, we can we can all learn from
Speaker 1: each other. And what he just talked about was really
Speaker 1: about talent and talent drives everything.
Speaker 3: We're in a people business.
Speaker 1: No matter how much data we collect, no matter how
Speaker 1: much technology we implement, we're in a data business. He
Speaker 1: didn't want to get into much detail. He has called
Speaker 1: me about tire selection and I did call him for
Speaker 1: advice during the government shutdown, I said, hey, should we
Speaker 1: brainstorm about these issues?
Speaker 3: But anyway, that's really just between him and me, his leaders.
Speaker 2: So for the sprint, you were a hardsoft medium. You
Speaker 2: were there every call.
Speaker 3: He doesn't call me live. We usually talk a couple
Speaker 3: of days before we've.
Speaker 1: Got a race, and then you know, I'll talk to
Speaker 1: him like leading up to the government shutdown, But once
Speaker 1: it happens, I'm doing my thing.
Speaker 3: He's doing well.
Speaker 2: Maybe you're the right person for this, Harvey, because I
Speaker 2: was really struck by something you said last week at
Speaker 2: a conference. You called yourself as part of being the
Speaker 2: top of Carlisle also the chief worry officer. Sure, what
Speaker 2: is your chief worry right now? As the chief worry officer, the.
Speaker 1: Important thing about being the chief warry officer is there's
Speaker 1: no list of things that one doesn't worry about. But
Speaker 1: I think that, you know, part of my role and
Speaker 1: primarily really what drives my role is exactly what Laurna
Speaker 1: said about enabling the team, motivating the team, bringing the
Speaker 1: team together, ensuring that the team, you know, feels good
Speaker 1: about success but not too good, always staying hungry but
Speaker 1: at the same time humble. They've had really remarkable success
Speaker 1: since he stepped in. I mean, it is a extraordinary
Speaker 1: with this with this man leader and friend and the
Speaker 1: whole team and Max.
Speaker 3: Have achieved like it's really needs to be underscored.
Speaker 1: I think in terms of worries, the key things about
Speaker 1: worrying is anticipating things that may happen, but allowing your
Speaker 1: teams to really digest that information. So at this particular
Speaker 1: point in time, as we said here, you know, there's
Speaker 1: a lot of people talking about markets being priced for perfection,
Speaker 1: or geopolitics or basically the way governments are relating, and
Speaker 1: trends that have existed for thirty forty fifty years that
Speaker 1: are somewhat reversing. I would put all these things sort
Speaker 1: of on my list of things I focus on. But
Speaker 1: there's nothing as I sit here this morning, that I'm
Speaker 1: worried about, you know, other than the that you know,
Speaker 1: we're going to win every race for the rest of
Speaker 1: the season, which also I will now say was part
Speaker 1: of our contractual agreement.
Speaker 5: Yeah, oh wow, Okay, Well, if something goes wrong we
Speaker 5: don't win, we're going to check in on this. Not
Speaker 5: at all to that point, Max has been closing the gap.
Speaker 5: What needs to go right in order for that not
Speaker 5: only to be closed, but to be surpassed.
Speaker 4: Look, we take it raised by race as much as
Speaker 4: the world would like us to talk about the World Championships,
Speaker 4: because yes, mathematically it has been reopened thanks to the
Speaker 4: string of success we have been having. The true seas,
Speaker 4: we take it raised by race. We even take it
Speaker 4: day by day sessionization. That's how we keep the right focus,
Speaker 4: the right intensity in every decisions we make, and that's
Speaker 4: you know the rest will be the consequence of that level.
Speaker 2: Only twenty six must be on your mind, and especially
Speaker 2: the second set I think is on a lot of
Speaker 2: people's mind. You take it day by day, but at
Speaker 2: what point do you think you'll have the information you
Speaker 2: need to make that decision for the second seat next year.
Speaker 4: You know, we are in a very comfortable situation. We
Speaker 4: have the year contracts on our site for all of
Speaker 4: our drivers. They are great kids. We want to give
Speaker 4: them as much time as possible to show us what
Speaker 4: they want to show us. So of course we don't
Speaker 4: want to wait until the last race, because you know,
Speaker 4: if somebody loses seat, we need to be fair with
Speaker 4: this person. But we think a couple of prices would
Speaker 4: probably make a core and.
Speaker 2: What are you focusing on the priorities for making that decision.
Speaker 4: It's super simple, is the same then for every single
Speaker 4: business it's performance of performance only.
Speaker 2: Performance only. Harvey, in thinking about where the world goes
Speaker 2: from here, I'd be remissified didn't bring up the chief
Speaker 2: worry of the moment, and that is concern about credit conditions.
Speaker 2: You've made it very clear that some of the issues,
Speaker 2: be it first brands, be it some of the regional
Speaker 2: banks more recently, if it is a cockroach, it's not
Speaker 2: termites that are destroying the foundation of the building. They
Speaker 2: might be a one off. At what point do you
Speaker 2: start to get concerned that maybe it doesn't necessarily show
Speaker 2: that the whole thing's going to crumble, but it's a
Speaker 2: late cycle and there have been mistakes made that might
Speaker 2: pop up more frequently.
Speaker 1: Well, I think a lot of the questions that are
Speaker 1: being asked make a lot of sense. You know, since
Speaker 1: the financial crisis, we've had generally speaking, very stimulative policy
Speaker 1: in all respects, quantitative easing, fiscal policy through the pandemic
Speaker 1: and beyond, and so it's unsurprising when you look back,
Speaker 1: of course, surprising when we came out of the financial crisis,
Speaker 1: but unsurprising when you look back the trajectory of markets
Speaker 1: that we've experienced. Anytime you're very late cycle like this,
Speaker 1: any news item could be disruptive to a market on
Speaker 1: any given day. I think that we haven't had really
Speaker 1: a credit or session driven credit cycle in a very, very,
Speaker 1: very long time, and so people are right to be
Speaker 1: concerned when they see credit under performance. Having said that,
Speaker 1: the bigger questions around systemic risk, or when you say
Speaker 1: will things crumble, Just because we haven't had a credit
Speaker 1: cycle in a long time doesn't mean if we go
Speaker 1: through a credit cycle, which inevitably we will, that's a
Speaker 1: certainty that things will crumble. I think the market structure
Speaker 1: is such today that it's pretty resilient. And when we
Speaker 1: look at our data across our portfolio companies, as we've
Speaker 1: talked about any there are seven hundred thousand employees and
Speaker 1: our portfolio companies around the world, they're twenty four hundred
Speaker 1: at Carlisle driving all this activity. When we look at
Speaker 1: that data today, that data suggests that companies are growing.
Speaker 1: Employment is steady, inflation is a little sticky, but there's
Speaker 1: nothing in the immediate horizon that suggests that as you
Speaker 1: would say things are crumbling. Having said that late cycle,
Speaker 1: it should be on a worry list.
Speaker 2: It should Okay, makes sense as chief worry officer, what
Speaker 2: specifically is the worry Then if it's not system.
Speaker 1: We should get to a point where markets are let's say,
Speaker 1: very stretched, credit spreads are very tight. It's about how
Speaker 1: you deploy marginal capital from our perspective, and so when
Speaker 1: we think about it again, we're not in the business
Speaker 1: of avoiding risk. That's not the business we're in. We're
Speaker 1: in the risk taking business. We have to be in
Speaker 1: the business of pricing it correctly. So anytime your late
Speaker 1: cycle you want to be very, very thoughtful about that
Speaker 1: marginal risk deployment. Last year we deployed billions of capital,
Speaker 1: sometimes in Europe, sometimes in the US, sometimes in Asia.
Speaker 1: But you have to be looking around the world for
Speaker 1: the capital with the right risk return. And that's what
Speaker 1: we do on behalf of all of our clients.
Speaker 2: Just to bring this back around, there have been some
Speaker 2: concerns that with the amount of money coming in from
Speaker 2: wealth that that gets harder to do just because there's
Speaker 2: that much more money that needs to be deployed, and
Speaker 2: maybe you go into things that you otherwise wouldn't have
Speaker 2: because that money needs to be put to work. Is
Speaker 2: that a fair concern?
Speaker 1: Well, I think it's a it's a fair concern if
Speaker 1: you're not thoughtful about deployment. In the history of cycles,
Speaker 1: what you tend to see is you tend to see
Speaker 1: too much capital coming into a space, chasing chasing too
Speaker 1: little return. It's our responsibility to manage that capital thoughtfully,
Speaker 1: and so that's our obligation.
Speaker 3: That's how we think it.
Speaker 2: Is there a concern that others aren't doing that as
Speaker 2: this money's coming in.
Speaker 1: I think any time you go through a long cycle,
Speaker 1: you're going to see marginal participants who may not make
Speaker 1: the best judgments. But again, your point is whether or not.
Speaker 1: Really what you're getting is whether or not it's systemic
Speaker 1: or not. I don't see that right now.
Speaker 2: Well, just before we let both of you go the
Speaker 2: first big splashy sponsorship, more more to come between you two,
Speaker 2: between Carlisle and other sports.
Speaker 1: Right now, we're pretty through with this partnership and we
Speaker 1: just continue to root for our friend here on the
Speaker 1: whole team in Max.
Speaker 3: And so now we're quite satisfied.
Speaker 4: And you know, on our side, we are very proud
Speaker 4: that Carlile is the first ever global investment firms to
Speaker 4: partners in Formula one, you know, is the first and
Speaker 4: also for the sport to be connected with as part
Speaker 4: of the business. And we are very poor that they
Speaker 4: chose or curricle racing.
Speaker 3: Yeah, we're thrilled with it.
Speaker 2: We're all excited to watch watch the race today with
Speaker 2: the Carlisles signed zipping by and good luck and congratulations
Speaker 2: already for this weekend.
Speaker 4: Thank you both so much.
Speaker 3: Thanks Danny