Speaker 1: This is Mesters in Business with Very Results on Bluebird Radio.
Speaker 1: This week, on the podcast, I have an extra special guest,
Speaker 1: Joan Solitar. She's the global head of Private Wealth Solutions
Speaker 1: at private investment giant black Stone. They run about six
Speaker 1: four billion dollars in assets. The Private Wealth Solution Group
Speaker 1: runs over a hundred billion dollars and man, this is
Speaker 1: name it. If you're interested in any sort of alternative investment,
Speaker 1: from private equity to real estate, to non traded rates
Speaker 1: to debt and credit, you're gonna find this to be
Speaker 1: absolutely fascinating. Joan has had really an amazing career from
Speaker 1: from research uh to she helped bring black Stone public.
Speaker 1: She's just got a tremendous background and is incredibly knowledgeable
Speaker 1: about the space. I only suggests listening to this twice
Speaker 1: because a lot of stuff goes by quickly with no
Speaker 1: further ado. My conversation with Joan Solotar. This is Master's
Speaker 1: in Business with Very Renaults on Bloomberg Radio. My special
Speaker 1: guest this week is Joan Solotar. She is Blackstone's global
Speaker 1: head of Private Wealth Solutions. She has been named one
Speaker 1: of the hundred most Influential Women in Finance several years running.
Speaker 1: Black Stone is the world's largest alternative asset manager, with
Speaker 1: six four billion in assets. Jones Department, the Private Wealth
Speaker 1: Solution manages over a hundred billion dollars in assets. Before
Speaker 1: joining black Stone in two thousand and seven, Miss Solotar
Speaker 1: was head of equity research at Bank America Securities and
Speaker 1: a highly ranked institutional investor All Star. Joan Solotar, Welcome
Speaker 1: to Bloomberg. Thank you, thanks for having me my pleasure. So,
Speaker 1: so let's talk a little bit about your career. You
Speaker 1: were at Credit Swiss and uh D l J as
Speaker 1: a highly ranked analyst. What what did you cover? What
Speaker 1: was your space? I covered financial services pretty much anything
Speaker 1: non bank uh so started in insurance and then wound
Speaker 1: my way to you know, mortgage insurance companies. Eventually really
Speaker 1: focused on the brokerage industry and asset management. Very interesting.
Speaker 1: And then you end up at a Bank America Maryland Securities.
Speaker 1: You were head of research there, correct that I know
Speaker 1: lots and lots of folks from old Mother Meryl were
Speaker 1: either strategists or in the research department. How did you
Speaker 1: leap from there to Blackstone? So? When I was at
Speaker 1: D l J, I worked on the firm's public offering.
Speaker 1: We were spun out of Equitable and Tony James was
Speaker 1: president of d LJ Very Senior credit Suites, and then
Speaker 1: he went over to become president of Blackstone and called
Speaker 1: me when they filed to go public to see if
Speaker 1: I would join to help them with that process and
Speaker 1: run sharehold relations and strategy, which is what I did initially. So,
Speaker 1: so how do you transition from shareholder relations to private
Speaker 1: wealth solutions? So I I've held a few different roles
Speaker 1: at Blackstone. I'd say the common theme among them is
Speaker 1: that I've always worked across the entire firm and in
Speaker 1: private wealth. I was asked to move in and and
Speaker 1: really create a scale, global business, and so I took
Speaker 1: the skill set that I had around uh, being a
Speaker 1: strategic thinker and being able to manage teams of people,
Speaker 1: which I did at UM at b of A, and
Speaker 1: really applied that here the last six years. So you
Speaker 1: were there pre I p O, two weeks pre IPO. Okay,
Speaker 1: so that counts a little bit a little. I was
Speaker 1: going to ask you what the difference was working at
Speaker 1: a private company versus a public company, but I don't
Speaker 1: know how much that would apply you've mostly been at
Speaker 1: public companies your whole career. Yes, well, d l J
Speaker 1: was subsidiary of Equitable, which was a subsidiary of Access,
Speaker 1: So until it yourself went public, didn't feel like that.
Speaker 1: It felt very much UM in a lot of similar
Speaker 1: ways to Blackstone, like a partnership, and even Blackstone when
Speaker 1: I first joined, you know, fewer than a thousand employees,
Speaker 1: it was, it felt like a partnership, still small, and
Speaker 1: now it's considerably larger than than a thousand employees, isn't
Speaker 1: it correct? So probably not as big as many think,
Speaker 1: But we're about a little more than three thousand employees globally.
Speaker 1: That's that's quite a chunk. So black Stone has made
Speaker 1: a very large bet on the individual, focusing on one
Speaker 1: to five million dollar clients through investment advisors. Tell us
Speaker 1: a little bit about the thinking behind that move, because
Speaker 1: I think when most people think of of black Stone,
Speaker 1: they think big institutions, not individuals. So you have to
Speaker 1: really go back in time, and I'll put my strategy
Speaker 1: pat back on UM. During the financial crisis, we were
Speaker 1: thinking a lot about where money was coming from for
Speaker 1: our funds, and we were very heavily dependent upon us
Speaker 1: pension funds, who are still quite an important set of
Speaker 1: clients for the firm, And at that time we made
Speaker 1: the decision to expand internationally, both Europe and Asia, and
Speaker 1: then also start to think about how we would approach
Speaker 1: private wealth. Uh So we started distributing through the big
Speaker 1: wire houses initially and really focused on qualified purchasers. Uh
Speaker 1: so those five million and above who could invest in
Speaker 1: the traditional private equity funds UM. But more and more
Speaker 1: we were getting inquiries, well, how do we give access
Speaker 1: to good products, good service to more people. And for that,
Speaker 1: uh we began creating bespoke funds to address that market.
Speaker 1: And these are accredited investors or not, and somewhat more
Speaker 1: sophisticated than UM the average investor. When I was preparing
Speaker 1: for this, I came across a Business Insider column that
Speaker 1: described what you you said was your AHA moment that
Speaker 1: totally changed your career. Tell us what was that moment
Speaker 1: I believe you're referring to. When I was at d
Speaker 1: l J and one of the we call them principles
Speaker 1: like partners came into my office and said, Hey, you know,
Speaker 1: I'm going to this dinner tonight for Principles and and
Speaker 1: you really should be there, but you need to tell
Speaker 1: people that becoming a principle is important to you. And
Speaker 1: that just never occurred to me. I just thought, like,
Speaker 1: you put your head down, you do a job, and
Speaker 1: someone's like, oh, let's make let's make her a principle.
Speaker 1: And I'm sure that often is the case, but it
Speaker 1: certainly isn't always the case. And so I went into
Speaker 1: the office of the head of research and just said,
Speaker 1: I think I deserved to be principal for the following reasons.
Speaker 1: It is something that's very important to me. And I
Speaker 1: was named a principle that year. So let's talk a
Speaker 1: little bit about black Stone. They've created a tremendous amount
Speaker 1: of wealth with their limited partners and employees as well
Speaker 1: as their shareholders. What do you have to do to
Speaker 1: stay ahead of the pack? This is a hyper competitive
Speaker 1: space with billions and billions of dollars looking for an edge.
Speaker 1: What does Blacks don't have to do to keep its
Speaker 1: leadership role. I think it's a great question. Uh. Steve
Speaker 1: Schwarzman often says that there's nothing patentable in finance, meaning
Speaker 1: everyone in the world can see what you're doing and
Speaker 1: they're app to copy it. If it's successful, so you
Speaker 1: have to keep moving and for our firm, that means
Speaker 1: continuing to find new areas where we see great investment
Speaker 1: opportunities where others aren't as competitive, and that might mean
Speaker 1: you know, we are, for example, the biggest real estate
Speaker 1: investor in the world, so from a scale perspective, there
Speaker 1: are transactions we can do that no one else can do.
Speaker 1: And building that kind of scale in life sciences, in
Speaker 1: direct lending, in private equity, which is a bit more competitive,
Speaker 1: but again not at the scale that we're at, that's
Speaker 1: been a huge advantage for us, especially in this environment.
Speaker 1: Huh So, so you're running the Global Private Wealth Group,
Speaker 1: tell us about that role and what your responsibilities include.
Speaker 1: So it's been just terrific to be involved in the
Speaker 1: building of this business. So essentially we are running Private
Speaker 1: Wealth as an end to end business rather than a
Speaker 1: sales organization. And what does that mean. It means everything
Speaker 1: from product development on the front end, to providing education
Speaker 1: for advisors and marketing material, using data analytics to better
Speaker 1: focus our salespeople, and having a robust investors erviss team
Speaker 1: on the back end and doing that globally, so serving
Speaker 1: your clients. Uh In Japan with folks who are on
Speaker 1: the ground speaking Japanese and having websites in native language,
Speaker 1: which may sound obvious, but takes a lot of people,
Speaker 1: a lot of effort, and we've been able to continue
Speaker 1: to vault ahead of the competition. So you mentioned investors
Speaker 1: and clients, who are the clients tell us about a
Speaker 1: typical PWS investor. So I'll divide the clients into really
Speaker 1: three buckets. At the wealthiest end our family offices which
Speaker 1: are often run like institutions with the chief investment officer, cetera,
Speaker 1: but really want a single point of contact into all
Speaker 1: the Blackstone offers. The next tronche would be qualified purchasers,
Speaker 1: so folks also very wealthy individuals with five million dollars
Speaker 1: or more, and they really are by SEC standards allowed
Speaker 1: to invest in anything. A big part of the market.
Speaker 1: It's what we call accredited in the US. It has
Speaker 1: different names all over the world, but essentially investors with
Speaker 1: one to five million dollars who want and historically have
Speaker 1: not had access to great product. And we also do
Speaker 1: serve investors who are below the million dollar level, but
Speaker 1: not with that many products that are suitable for them,
Speaker 1: and and so one to five five plus. I tend
Speaker 1: to think of family offices as fifty plus, but I
Speaker 1: know that number some people say, some people say hundred.
Speaker 1: How do you look at family offices? Typically we really
Speaker 1: haven't defined it that way, but I think you're fifty
Speaker 1: million is probably a good place. So now an investor
Speaker 1: has five or ten million dollars in a total portfolio,
Speaker 1: and I'm just spit bowling here. They have a million immunis,
Speaker 1: they have another six seven million in traditional, active and
Speaker 1: passive funds, and they have a couple of million dollars
Speaker 1: lying around that. They're looking for a little more non correlated,
Speaker 1: maybe a little alpha. How do you fill that gap
Speaker 1: for that client? Are you selling that through O I
Speaker 1: A S or you're selling it direct? Tell us a
Speaker 1: little bit about what that um slug in that portfolio
Speaker 1: looks like. So we are absolutely partnering with R A
Speaker 1: S and with advisers again around the world, whether they're
Speaker 1: in global banks, private banks, big wire houses, or independence. Uh.
Speaker 1: And you know, to you to your question about where
Speaker 1: people are invested now and what they're looking for at
Speaker 1: the moment, historically you would say, oh, you know, our
Speaker 1: clients are are really looking at portfolio that's sixty forty
Speaker 1: something like that the traditional mix. And I would say today,
Speaker 1: given the search for yield, which is very hard to
Speaker 1: find everywhere in the world, the need for private credit
Speaker 1: is greater. Uh, given where market valuations are, private investing
Speaker 1: is more attractive because you have more control over the asset,
Speaker 1: you're not subject to the whims, and we're not investing
Speaker 1: in the market per se. We're choosing the neighborhoods we
Speaker 1: want to be in. So you know, I'm fortunate in
Speaker 1: that the performance of Blackstone funds across all the alternative
Speaker 1: asset classes has been good over a long period of time,
Speaker 1: So we have a lot of material to work with,
Speaker 1: and then we meet the individual needs. So it could
Speaker 1: be that your client, as an advisor, you know, want
Speaker 1: to put of her or his assets into alternatives and
Speaker 1: they want a diversified portfolio. We have a product that
Speaker 1: matches that. Or they're earning you know, x percent three
Speaker 1: on the municipal Bomb portfolio. And we have other funds
Speaker 1: in real estate and credit that can return much more
Speaker 1: that are also floating rate, which gives them better inflation protection.
Speaker 1: So some of what you're doing is a non correlated
Speaker 1: substitute for traditional equity, Hey, equity prices are let's call
Speaker 1: it fully valued. Some people think it's gone beyond that um,
Speaker 1: although we seem to be having delightful earnings this quarter,
Speaker 1: so maybe this market can grow into its valuation. But
Speaker 1: that's one alternative. You reference yield and and what what
Speaker 1: investors are looking for. If someone says, hey, I want
Speaker 1: a higher return, I'm willing to take a little more risk,
Speaker 1: but not I don't want to run into the same
Speaker 1: problem we run into with subprime What sort of products
Speaker 1: do you have for I'm gonna ap peel some of
Speaker 1: my forty off to to something that is going to
Speaker 1: do better than one point two percent that I'm getting
Speaker 1: on on my treasuries? What do those fixed income like
Speaker 1: products look like? Are they structured notes? Are they real estate?
Speaker 1: Tell us a little bit about that, sure. Uh so.
Speaker 1: For example, one fund right now that has a lot
Speaker 1: of traction is our non traded read, which invests in
Speaker 1: high quality US real estate. Again, the same themes that
Speaker 1: we're investing in for the institutional fund and the same team. Importantly,
Speaker 1: so areas like multi family housing where there's a supply
Speaker 1: demand mismatch or logistics playing on a very long term
Speaker 1: theme around e commerce, which is only accelerated during COVID.
Speaker 1: Tell us a little bit about the credit side you mentioned. So,
Speaker 1: there's a secular trend in private credit that really started
Speaker 1: in the financial crisis where banks no longer wanted to
Speaker 1: hold onto risk and we're syndicating out. And it also
Speaker 1: at that time became clear that they were less willing
Speaker 1: to lend to middle market companies. So originally what began
Speaker 1: as a middle market industry in private credit emerged, and
Speaker 1: we were certainly one of the leaders in that. But
Speaker 1: I would say today, because of the scale that we have,
Speaker 1: we're actually able to lend to much larger companies. So
Speaker 1: it's an industry that has real secular tail winds in
Speaker 1: terms of the demand for private credit, and we're able
Speaker 1: to deal with you know, large companies, complex transactions, unitron
Speaker 1: to take the whole deal, uh, And we've been able
Speaker 1: to create funds around that for individuals that deliver good returns.
Speaker 1: And importantly, we've been able to create structures that also
Speaker 1: work outside of the US. And so both of these areas,
Speaker 1: whether it's private real estate or private credit, have appeal
Speaker 1: right now in the US, in Europe, in Latin America
Speaker 1: in Asia. Uh. And you know we're able to service
Speaker 1: those folks because our businesses of scale on the private
Speaker 1: wealth side and also of scale in terms of how
Speaker 1: much we can invest. That's quite quite intriguing. Let's talk
Speaker 1: a little bit about E. S. G. Blackstone has said,
Speaker 1: as the world's largest alternative asset manager, we are uniquely
Speaker 1: positioned to make a positive impact through our investments. Tell
Speaker 1: us a little bit about how you approach environmental, social,
Speaker 1: and governance impact investing. So we've really taken a holistic approach,
Speaker 1: both for our own company as well as the companies
Speaker 1: that we own inside our various funds. And to start
Speaker 1: with the environmental even going back, you know, many years now,
Speaker 1: we looked at efficiency around energy and water, etcetera. So
Speaker 1: for example, if you own hotels, thinking about what kind
Speaker 1: of light bulbs, where do you set the temperature? Things
Speaker 1: of that nature. Flushers on toilet's probably a little less sexy,
Speaker 1: but actually important. And today we've made a commitment that
Speaker 1: for any property or a company that we control, we
Speaker 1: will reduce emissions by at least fifteen percent um. You know,
Speaker 1: we we I don't know if you know, in one
Speaker 1: of the folios we actually own uh Sty Town here
Speaker 1: in New York, and we created the largest solar farm
Speaker 1: on any multi family housing development in the US. There,
Speaker 1: that's one example, uh And I would say around the
Speaker 1: other areas when it comes to UM governance, and by
Speaker 1: that I assume you mean diversity on board director C
Speaker 1: we have likewise a commitment there for at least thirty
Speaker 1: percent representation by women underrepresented groups, and again for our
Speaker 1: own company as well as for our portfolio companies. So
Speaker 1: let's talk a little bit about PWS as it's called. Internally.
Speaker 1: Your group runs over a hundred billion dollars. Tell us
Speaker 1: about some of the attractive places that you're deploying capital today. Sure,
Speaker 1: so we tend to be very thematic at Blackstones. A
Speaker 1: lot of research comes into play upfront. We figure out
Speaker 1: where we have the most conviction, and then we're not
Speaker 1: afraid to go all in. And importantly, if you think
Speaker 1: about investing as pattern recognition, and you think about everything
Speaker 1: we own real estate companies, all different types all over
Speaker 1: the world. It's just a lot of information flow that
Speaker 1: comes into play. So today areas off of themes, like
Speaker 1: you know, the digitization of everything. So if you think
Speaker 1: about our investment in Bumble or Ancestry was on that
Speaker 1: in e commerce. This has been a long running theme
Speaker 1: through the firm over the last ten years. So that
Speaker 1: informs not just what you invest in, but what you avoid.
Speaker 1: So we we have not been investing in closed malls,
Speaker 1: but we have been buying up warehouse assets, especially first
Speaker 1: mile those that are closest to clients. Again, everywhere around
Speaker 1: the world housing there's a housing shortage, uh really in
Speaker 1: a lot of different regions, and and what just meaning
Speaker 1: that there hasn't been enough supply. And when you think
Speaker 1: about all of the delays caused by shutdowns due to COVID,
Speaker 1: it's just exasperated those or exaggerated those trends even more so.
Speaker 1: And um, when you have supply demand and balances, that's
Speaker 1: usually pretty good for appreciation. We coming through the financial crisis,
Speaker 1: had created the largest single family housing you know, owned
Speaker 1: to rent company, and we're continuing to invest in those
Speaker 1: types of assets. We really like life sciences. You mentioned uncorrelated.
Speaker 1: That's an area that is uncorrelated, and we partner with
Speaker 1: major pharmaceutical companies. We invest in their Phase three trials
Speaker 1: which have very good high percentage UH chance of success.
Speaker 1: Cloud computing, and there's a lot of different neighborhoods that
Speaker 1: we like. And then I would say, also we like
Speaker 1: the industries that serve those. So once we find a
Speaker 1: theme something like life sciences, were also then interested in
Speaker 1: owning the real estate that's catering to life sciences companies.
Speaker 1: So the intellectual capital really moves through the firm, and
Speaker 1: we're able to whether it's growth equity, private equity, real estate,
Speaker 1: life sciences credit, run that all the way through. And
Speaker 1: so you would find over the firm's history and continuing today,
Speaker 1: our various different businesses may invest in a different part
Speaker 1: of the capital structure. Uh, they may invest in different companies,
Speaker 1: but they're all focused on this idea of good neighborhoods. Huh.
Speaker 1: So that that's very intriguing. I always have a hard
Speaker 1: time drawing a bright line between what sounds a lot
Speaker 1: like private equity but looks a little bit like late
Speaker 1: stage venture capital. I hear cloud and life sciences and
Speaker 1: bumble and ancestry dot com. How does that distinction make
Speaker 1: any difference to you, guys? Is it really just an
Speaker 1: academic distinction or clearly you're not doing seed investing. We
Speaker 1: understand that, but what is the difference between black Stone
Speaker 1: private equity and very late stage venture investing. So, by
Speaker 1: and large, we have not been venture investors in the
Speaker 1: way that you're thinking about, in part because the outcomes
Speaker 1: are binary, and when we're making an investment, we always
Speaker 1: try to think about protecting on the downside, and that's
Speaker 1: quite difficult to do in a venture deal. So I'm
Speaker 1: distinguishing that from growth equity because these are larger companies
Speaker 1: where the entrepreneur doesn't want to seed control but is
Speaker 1: attracted to what we can bring in helping her him
Speaker 1: really scale the business. So again I'll go back to
Speaker 1: UH company like you know, Bumble or where we made
Speaker 1: an investment in Totally and what is it we bring.
Speaker 1: We have this massive portfolio of companies and properties that
Speaker 1: we can introduce them to. We have a data science
Speaker 1: team of more than thirty people that we then deploy
Speaker 1: right onto these companies. We have a suite of highly
Speaker 1: talented former CEOs executives who partner with UH. Those CEOs,
Speaker 1: who again are are often entrepreneurs who may have not
Speaker 1: usually have not taken their company and built it into
Speaker 1: some major global institutions. So I would distinguish it in
Speaker 1: a lot of Uh, those aspects were coming in much later.
Speaker 1: We're not saying this technology works or doesn't. It's already proven,
Speaker 1: and then we're bringing something to much greater scale. Right.
Speaker 1: I like the concept of Hey, if it's truly binary,
Speaker 1: then that's much more like UM venture capital. If there's
Speaker 1: a range of potential outcomes with a very very low
Speaker 1: possibility that the whole thing goes to zero, that's more
Speaker 1: private equity that that. That's a really good framework for
Speaker 1: that UM. So let's let's stick with you mentioned the
Speaker 1: intellectual capital that moves around the firm. UM. We're kind
Speaker 1: of sort of reopening people little nervous around delta UM.
Speaker 1: How did you guys operate during the pandemic. I assume
Speaker 1: everyone was working from home, and what are your plans
Speaker 1: going forward? How are you going to manage? Yeah, it
Speaker 1: was certainly turbulent times. We acted very quickly. So one
Speaker 1: thing that UM launched literally the week that we shut
Speaker 1: down in the US is John Gray, our president and CEO,
Speaker 1: launched a global call for all employees, which still happens
Speaker 1: every single week. And during that meeting, we hear about
Speaker 1: macro government, what's happening in some of the portfolio companies,
Speaker 1: new investments, and the basic trends. It was also just
Speaker 1: the best mechanism for everyone at the firm UH to
Speaker 1: know what was going on, talk about COVID and really
Speaker 1: around the world, and we do that on Zoom so
Speaker 1: that you're present. And again this has now been going
Speaker 1: on since mid March of with my own team, I
Speaker 1: made great efforts to stay connected. Again, we were all
Speaker 1: on Zoom, not telephone, so you can actually see people.
Speaker 1: I personally added many more meetings than I had previously,
Speaker 1: regularly scheduled meetings with my sub teams, with the leaders
Speaker 1: of my business to make sure we were connected. And
Speaker 1: we also added in a lot of virtual events, you know,
Speaker 1: whether they were virtual cocktail hours or lunches or breakfast
Speaker 1: we did hold. I my my children make fun of
Speaker 1: me because I did the same cooking class like five
Speaker 1: different times, so I can now make an excellent you know,
Speaker 1: pasta sauce um. But I think it was important not
Speaker 1: just to get the business done, to prosecute the business,
Speaker 1: of course, that's important, and serve your clients, but equally
Speaker 1: important was to keep the team together, have everyone with
Speaker 1: full information feel connected, even though we weren't physically in
Speaker 1: the same place, and then I didn't mention, but as
Speaker 1: importantly was staying connected with our clients, and so we
Speaker 1: immediately launched webinars conference calls about what we were seeing
Speaker 1: from a macro level in our portfolio. Companies very transparent
Speaker 1: about what was happening in the funds and just providing
Speaker 1: advisors and clients with the most up to date information
Speaker 1: that we had, and I think they appreciated that. Huh.
Speaker 1: Quite quite interesting. So so within financial services, people like
Speaker 1: Jamie Diamond at JP Morgan Chase Morgan, Stanley Goldman, Sachs
Speaker 1: a roll calling staff back to work. Other places are
Speaker 1: talking about a hybrid all going forward. You're in a
Speaker 1: couple of days a week, but it's not Monday to
Speaker 1: Friday nine to five. Have you, guys thought about what
Speaker 1: you want to do and have have you come out
Speaker 1: with any decision yet publicly? Yes, So we have. The
Speaker 1: investing teams have by and large been back full time
Speaker 1: now for several months. For my team, I said we
Speaker 1: would remain flexible through the summer and then we'll figure
Speaker 1: out the cadence. But the vast majority of my team
Speaker 1: comes in and there were several employees not surprisingly who
Speaker 1: were quite nervous. But the firm invested a lot uh
Speaker 1: in terms of creating our own testing mandatory testing, distancing
Speaker 1: tracing app that we have to keep open at all
Speaker 1: times to make people feel safe in the environment that
Speaker 1: we were in. A number a number of big firms
Speaker 1: are mandating vaccines? Did you guys go that far? Also?
Speaker 1: It makes perfect sense to me, but I know you
Speaker 1: can get pushed back from some quarters. So just this
Speaker 1: week we told employees that if they're not vaccinated, they
Speaker 1: shouldn't come to the office, and if you're not in
Speaker 1: the office, your career is probably not fast track. I
Speaker 1: hope that everyone will decide to take the vaccine just
Speaker 1: for their own health. We have not said you can't
Speaker 1: work at the firm um, but I think it's it's
Speaker 1: in the interim. You can certainly do whatever you're doing remotely,
Speaker 1: but you just you lose the connectivity. And to me,
Speaker 1: what you know, one of the great parts of my
Speaker 1: job is actually being with the team, interacting, exchanging ideas.
Speaker 1: I think that's much harder to do when your box
Speaker 1: on someone's computer. So you referenced earlier the impact of
Speaker 1: low rates where clients were previously allocating money to the
Speaker 1: bond portion of a sixty forty portfolio. How are low
Speaker 1: rates impacting everything today and what is black Stone doing
Speaker 1: about it? So I think about the impact of low
Speaker 1: interest rates from two perspectives. One is how does it
Speaker 1: affect an investor, an individual investor or an institutional investor,
Speaker 1: and how does it affect Blackstone investing in companies and properties.
Speaker 1: So on the former, it is much harder to reach
Speaker 1: your goals, whether their retirement or sending your kids to college,
Speaker 1: or even just saving for the next few years at home, whatever.
Speaker 1: If interest rates are very low, you're earning nothing on
Speaker 1: your bank account, You're earning very little from your simple
Speaker 1: bond portfolio, etcetera. So how do you create more wealth?
Speaker 1: And for that, individuals institutions have been seeking yield in
Speaker 1: private credit, private real estate, as we mentioned, where you
Speaker 1: could just get better returns where you can apply a
Speaker 1: bit of leverage, but you don't have to extend all
Speaker 1: the way out on the risk curve. To do that,
Speaker 1: you don't have to be in highly levered funds, you
Speaker 1: don't have to be in the riskiest assets. And I'm
Speaker 1: often asked like, do you like non traded reads? Do
Speaker 1: you like private credit, and I always say it's it's
Speaker 1: for me. It's really not the fund structure as much
Speaker 1: as it is who is the investor putting the assets in.
Speaker 1: I mean, there's certainly not all created equally. So you
Speaker 1: want to be with a very high quality GP like
Speaker 1: black Stone if you will, But you want to, you know,
Speaker 1: really think about who you're entrusting your wealth or your
Speaker 1: client's wealth with. As it relates to Blackstone. On the
Speaker 1: investing side, I'll put credit aside for the moment. That
Speaker 1: means that you can borrow at much better rates um
Speaker 1: and you know that certainly helps the return. But I
Speaker 1: would say, really importantly, we always think about when we're underwriting,
Speaker 1: what will the next buyer have to borrow at to
Speaker 1: make it work. You don't want to get lulled into
Speaker 1: this false sense of complacency where you're like, oh, I
Speaker 1: could borrow for nothing and therefore, wow, this looks really attractive. Uh.
Speaker 1: Kind of similar to what happened to people when you
Speaker 1: think about, you know, the housing crisis, where they were
Speaker 1: just taking on way too much debt. So you know,
Speaker 1: it's it's that toggle between yes, we can borrow at
Speaker 1: very attract to rates but that doesn't mean that we
Speaker 1: want to inflate the price of the assets that we're buying.
Speaker 1: So it's it's really quite a balance, so not the
Speaker 1: greater fool approach to investing it. You're looking for a
Speaker 1: long time. So you mentioned equity richly valued and bond
Speaker 1: rates at long time uh lows. When we look at
Speaker 1: both asset classes, there each at all time highs. The
Speaker 1: one exception seems to be commercial real estate is in
Speaker 1: fact still at levels UM that are far below where
Speaker 1: we were during the pandemic. How attractive is commercial real estate?
Speaker 1: And we know Blackstone is a big investor in UM
Speaker 1: individual homes, rent to own, etcetera. What about traditional commercial
Speaker 1: real estate? So there too, you have to divide it
Speaker 1: into sectors. So if you're talking about offices or example
Speaker 1: today you would say, wow, like how could you invest
Speaker 1: in offices Actually not a big part of our portfolio,
Speaker 1: but with a pandemic and people working from home, and
Speaker 1: I would say you have to distinguish where you're investing
Speaker 1: and the type of offices. So on the lending side
Speaker 1: in real estate for us, you know we think about
Speaker 1: are these high end offices that are open plan that
Speaker 1: have a lot of amenities for tenants, those would be attractive.
Speaker 1: We look at office space for life sciences companies, UH,
Speaker 1: for production studios because one of the big themes for
Speaker 1: us is live streaming and how that's increasing. We look
Speaker 1: at where regionally we're investing. So if you use data
Speaker 1: and see you know where in which areas are the
Speaker 1: greatest number of ads for were jobs? Where are young
Speaker 1: people going? You can get a feel for housing trends,
Speaker 1: office trends, and very importantly in real estate, because buildings
Speaker 1: don't just pop out of the ground, you know what
Speaker 1: supply is, and so you're always looking for supplied demand
Speaker 1: imbalance and UH, we typically don't invest in new construction,
Speaker 1: and so we want to buy at a discount to
Speaker 1: replacement value. And that's really the formula. It sounds simplistic,
Speaker 1: but it's supplied demand discount to replacement value. That is
Speaker 1: the mantra that Blackstone has stuck to everywhere in the
Speaker 1: world since the early nineties. So I'm hearing two things.
Speaker 1: I'm hearing data matters, and what you pay for an
Speaker 1: investable asset is important. Yes, all right, that that makes
Speaker 1: a lot of sense to me. Uh, tell us what
Speaker 1: your clients are asking about today that you guys are
Speaker 1: not currently doing. What what's the next thing out there
Speaker 1: that's interesting. We typically when we venture into a new area, Uh,
Speaker 1: it's because we see an interesting investment opportunity, So we
Speaker 1: never think about it in terms of how much money
Speaker 1: can we raise. It's always how much money can we deploy.
Speaker 1: But to your question, increasingly investors are asking us about
Speaker 1: E s G investing, and Uh, it started more so
Speaker 1: outside of the US, in Europe in particular, but I
Speaker 1: am increasingly asked about it in the US. And E
Speaker 1: s G is something that's infused in all of our
Speaker 1: funds and investments. It's not something that to date we've
Speaker 1: really carved out as a product, but it's certainly something
Speaker 1: we're thinking about. So that's kind of interesting because the
Speaker 1: criticism has been E s G captures a huge amount
Speaker 1: of mind share, but only near as much capital as
Speaker 1: you would imagine. And when we do surveys of who's
Speaker 1: going to inherit the baby boomers money, it's invariably women
Speaker 1: and younger people, and they're both much more enthusiastic about
Speaker 1: E s G than the average investor. Is this something
Speaker 1: that you're really seeing start to change or is that
Speaker 1: change still out there. So there are different elements to it.
Speaker 1: One is that people are mindful of E s G,
Speaker 1: but they don't want to sacrifice on returns. So when
Speaker 1: you talk to foundations and endowments for example, very mindful
Speaker 1: of E s G, but the responses usually that's why
Speaker 1: we want to generate the greatest returns on the portfolio,
Speaker 1: so that we can then distribute the money, you know,
Speaker 1: to those causes. And when it comes to individuals, by
Speaker 1: and large, it's the same. They want to support these
Speaker 1: are topics that are important, but they don't want to
Speaker 1: really detract tremendously from returns. I don't imagine Blackstone will
Speaker 1: ever create a copycat or me too product Um. We
Speaker 1: spend quite a lot of time at the front end
Speaker 1: thinking about what we'll go into any of our funds.
Speaker 1: So I think when we do launch something, uh, it
Speaker 1: will be unique in the market. Interesting. So some people
Speaker 1: are quite worried about valuations, not just in the public market,
Speaker 1: but there's so much capital slashing around and it's found
Speaker 1: its way into the private markets. How concerned are you
Speaker 1: about valuations and and what sort of advice do you
Speaker 1: have for investors about that? So I am a warrior
Speaker 1: by nature, and I worry when valuations are high. I
Speaker 1: worry when they're low. And in my fourteen years at Blackstone,
Speaker 1: I don't think that I've really sat through a meeting
Speaker 1: where anyone thought the kind of investing we do is easy.
Speaker 1: There are always challenges, uh, and either you know, prices
Speaker 1: are low but no one's selling, or prices are too high.
Speaker 1: I think the key is not to buy a market
Speaker 1: and to focus on the sectors that you like, the
Speaker 1: companies where you think you can affect change. And this
Speaker 1: is a key in private markets versus public So we
Speaker 1: sign non disclosure agreements, we get inside information if you will,
Speaker 1: we have six months or whatever the time period is
Speaker 1: to do full due diligence. We have our portfolio operations
Speaker 1: team all over the company figuring out where we can
Speaker 1: make improvements. And you know, when in the old days,
Speaker 1: when those were industrial companies, was more about cost cutting.
Speaker 1: Today it's much more about leaning in on growth, connecting
Speaker 1: our portfolio companies to one another, making them more tech enable, etcetera.
Speaker 1: And that's really the of formula. You know, it's taking
Speaker 1: the company or the asset and applying either capital or
Speaker 1: talent to it. Rather than relying on on the market.
Speaker 1: If all you're doing is paying more than anyone else,
Speaker 1: that's a hard way to make money. To say the least.
Speaker 1: You mentioned fourteen years at black Stone. I remember the
Speaker 1: Blackstone I p O and I'm the pandemic has completely
Speaker 1: ruined my sense of time, because I never would have
Speaker 1: guessed that was fourteen years, but that was two thousand
Speaker 1: and five. That's a long long It seems like a
Speaker 1: long time ago. Um. One of the things I wanted
Speaker 1: to ask that I didn't get to before was the
Speaker 1: liquidly or illiquidly premium. When someone puts money in a
Speaker 1: black Stone funds, my assumption is they don't have access
Speaker 1: to that the way they would a regular publicly traded
Speaker 1: stock for an extended period of time. What's the typical
Speaker 1: lock up without penalty like for for your funds? And
Speaker 1: I'm also assume there's a wide range and there is
Speaker 1: no one number. So for the typical private equity or
Speaker 1: private real estate fund, uh, those are only accessible to
Speaker 1: qualified purchasers or institutional investors, and you're locked up for
Speaker 1: the life of the fund very deliberately, which is seven
Speaker 1: years typically or so. It's usually a ten year fund
Speaker 1: varies a little bit, but you control the timing going
Speaker 1: in and you control the exit. So you never want
Speaker 1: to be in a position where you're forced to invest
Speaker 1: quickly or you're ever forced to sell. So there is
Speaker 1: no early redemption. The redemption happens as you start selling
Speaker 1: down companies or assets in that portfolio. Makes a lot
Speaker 1: of sense. So I want to circle back to your
Speaker 1: You mentioned you're a warrior. Everybody I know who worked
Speaker 1: in equity research is a giant warrior. They're like, what
Speaker 1: did I miss? What's gonna ruin my investment thesis? How
Speaker 1: has the world of equity research changed from your perspective?
Speaker 1: You got to see it from the public side, from
Speaker 1: the private side, and over a couple of decades of investing,
Speaker 1: tell us a little bit about how research has changed. Yeah,
Speaker 1: it really has evolved. So in my earliest days, it was,
Speaker 1: first of all, we didn't even have excel um and
Speaker 1: there was, you know, no way to reach clients other
Speaker 1: than meeting with them or or calling them or companies
Speaker 1: for that matter. Um And but you were really an advisor,
Speaker 1: not just two investors, but also to the companies that
Speaker 1: you covered, and that endured, Uh, most of my tenure.
Speaker 1: It was what I enjoyed the most, getting to know
Speaker 1: the management teams, understanding their strategies, working on you know,
Speaker 1: I worked on dozens of I P those UH secondary offerings,
Speaker 1: M and A transactions and there was nothing nefarious about it.
Speaker 1: I worked closely with the investment bankers to really help
Speaker 1: the companies figure out their strategy. That all changed, if
Speaker 1: you remember, UH Elliot Spitzer came in looked at research.
Speaker 1: This was during the tech bubble and found that there
Speaker 1: were conflicts of interest UH that maybe investors didn't know about,
Speaker 1: maybe they did, but really hived off equity research from
Speaker 1: every other part of the business. And in many ways,
Speaker 1: I think it diminished um the value of the equity analysts.
Speaker 1: And you know, by and large, who's folks who had
Speaker 1: studied really probably knew these industries better than many of
Speaker 1: the management teams, if you will, working in them, because
Speaker 1: they had such a good feel for the competitive landscape
Speaker 1: as well. And at the same time, you had the
Speaker 1: proliferation of the hedge fund industry, so a lot of
Speaker 1: research analysts went to the buy side, left the cell side.
Speaker 1: You've had compression of commissions, etcetera, making cash equities a
Speaker 1: less profitable business that it once was. And so, uh,
Speaker 1: while I still know very many talented research analysts, I
Speaker 1: think it's unfortunate that what they're doing has been so restricted.
Speaker 1: Makes a lot of sense. What about social media has
Speaker 1: that disrupted cell side research? That is a good question.
Speaker 1: I don't know that social media has disrupted as much
Speaker 1: as information comes generally much more quickly than it ever did,
Speaker 1: and the expectation to have an immediate response. You know,
Speaker 1: when I go back in time where you really really
Speaker 1: had the time to think through and crunch numbers and
Speaker 1: you know, form of an opinion. Today it's much harder,
Speaker 1: and like you know, with social media, to to your point,
Speaker 1: everyone's out there with a view, with an opinion. It
Speaker 1: probably does make it much more challenging. So let me
Speaker 1: switch up gears on you a little bit. I want
Speaker 1: to ask you about uh black Stone Woman's Initiative, which
Speaker 1: I know you're involved with. Tell us about that. So
Speaker 1: I was involved in the formation of it, and at
Speaker 1: the time that I joined black Stone, only about ten
Speaker 1: percent of the analysts, applications applicants were female, and about
Speaker 1: of the class was female, and so I was really
Speaker 1: interested in how we can improve that. Uh, there was
Speaker 1: a perception that somehow, how private Equity Alternatives is in
Speaker 1: a great career for women. Not true, and so um,
Speaker 1: you know, I was trying to figure out what what
Speaker 1: we could do. So at the beginning, we really focused
Speaker 1: on educating young women, sophomores, juniors in college, inviting them in,
Speaker 1: teaching them you know what you need to know, uh,
Speaker 1: figuring out, you know, why they weren't applying, why we
Speaker 1: weren't hiring more, and going to those solutions. Today it's
Speaker 1: light years ahead of that. You know, between forty and
Speaker 1: fifty percent of our classes female now. Yeah, so big
Speaker 1: improvement there, and a lot of focus on professional development
Speaker 1: and networking and really trying to find common derailers for
Speaker 1: women and addressing those. So there's a quote of yours
Speaker 1: that I very much like because it's a philosophy that
Speaker 1: could apply to a lot of different people. But I
Speaker 1: like quote, get comfortable being uncomfortable. Explain what that means.
Speaker 1: It means that many women, especially young women, are comfortable
Speaker 1: doing the things that they know well. And unless you're
Speaker 1: willing to stretch, you're just never going to grow in
Speaker 1: your career. You don't have to know it all on
Speaker 1: day one, it's all learnable. You know, nothing that we're
Speaker 1: doing in at least in the roles that I've had,
Speaker 1: is rocket science. So if you apply yourself, if you
Speaker 1: ask questions, if you really want to learn it, you
Speaker 1: can learn it. But you have to be willing to
Speaker 1: push yourself a little bit and know that the first
Speaker 1: time you do anything, whether it's you know, speaking in
Speaker 1: front of a large group or presenting to senior people
Speaker 1: at the firm, whatever it is, it's not going to
Speaker 1: be as good as the hundredth time you do it.
Speaker 1: And that's okay. Is that a gender specific difference? And
Speaker 1: my flavor of sexism is dudes are just reckless and
Speaker 1: we are. They are not smart enough to think I
Speaker 1: don't know anything about this, so I'm just gonna plow
Speaker 1: ahead anyway. I get the sense that women tend to
Speaker 1: be a little more circumspect and thoughtful, or is that
Speaker 1: you know a stereotype and it's not accurate. So there
Speaker 1: have been studies showing that, for example, um, women will
Speaker 1: not raise their hands for the promotion unless they think
Speaker 1: they can tick off every single skill set, where as
Speaker 1: men may have very few of those skills, but they
Speaker 1: raise their hands, say I could do it. So that's
Speaker 1: definitely a gender difference. Hold my beer, that's a that's
Speaker 1: a dude thing. So this leads me right into tell
Speaker 1: us about truth for our daughters. So my daughter, Lindsay
Speaker 1: at the time was a freshman in college. She was
Speaker 1: a math major, so very few women already, you know,
Speaker 1: breaking barriers exactly, and some of her classes, although I
Speaker 1: guess increasingly there are a lot of women majoring in
Speaker 1: math now. And she had applied for leadership program and
Speaker 1: called me in tears and said, I just got called
Speaker 1: for the third round and I'm not qualified. And I said,
Speaker 1: you're a freshman in college. What qualifications do you think
Speaker 1: you need? Um? But it really made me sit back
Speaker 1: and think, here is this daughter of mine who is
Speaker 1: so capable, and she's showing all the insecurities that I,
Speaker 1: of course also had and that I've witnessed so many
Speaker 1: other women had. So it it really caused me to
Speaker 1: put pen to paper sort of a if I knew then,
Speaker 1: you know what I know him now? And um, and
Speaker 1: it was she she loved it. So it was it
Speaker 1: was and some of this some of the bullet points,
Speaker 1: we're pretty straightforward and and not a big surprise, but
Speaker 1: some were giant surprises that when I when I read
Speaker 1: through this, be ready for anything. That's good advice for
Speaker 1: anybody in finance. Be confident. I see the gender specific
Speaker 1: but um reasons for that. But but some of the suggestions, UM,
Speaker 1: speak twice as loudly as you think you need to.
Speaker 1: And I have a problem. I don't hear how loud
Speaker 1: I speak, so I speak too loud. Why is that
Speaker 1: advice necessary for women to tell them you have to
Speaker 1: speak loudly if you're a room full of people. So again,
Speaker 1: if you're generalizing, women tend to speak more softly and
Speaker 1: therefore don't come across having as much conviction in their
Speaker 1: ideas even if they do. Uh. And it really harkened
Speaker 1: back to when I was in a room, uh filled
Speaker 1: it was a boardroom and I was presenting on something
Speaker 1: I actually knew a lot about, and so and said, oh,
Speaker 1: can you speak up. I couldn't hear you, know, I
Speaker 1: couldn't hear you, And it just set me back, and
Speaker 1: I thought, this will never happen again. I also think
Speaker 1: there is sometimes a tendency when someone is speaking softly
Speaker 1: for someone else in the conference room to just come
Speaker 1: right over the top, and you know, interrupt and that
Speaker 1: doesn't happen when you're forceful. So it's one of the
Speaker 1: basic things I tell any mentee I have, any women
Speaker 1: that I'm meeting with, just speak loudly. Uh, make your
Speaker 1: voice heard. Uh. You don't need to know it all
Speaker 1: on day one. Very straightforward. You have no idea where
Speaker 1: you career will lead. Very straightforward. Here's another one that
Speaker 1: leapt out at me that I never would have thought of.
Speaker 1: Draw lines in the sand. Tell us what that means.
Speaker 1: So for me as a parent once I had kids,
Speaker 1: it was figuring out what I wouldn't give up. I
Speaker 1: think there many women are conflicted. They feel awkward saying
Speaker 1: I'm leaving the office because I have to take my
Speaker 1: child to the doctor, etcetera. And there were certain things
Speaker 1: I just wouldn't give up. I never missed a school
Speaker 1: performance or play. I never missed a parent teacher conference.
Speaker 1: But was I able to go to the gym? Was
Speaker 1: I able to make it home for dinner every night? No,
Speaker 1: So figure out where your lines in the sand are.
Speaker 1: Although I will tell you after a year of work. Um.
Speaker 1: My daughter was reflecting on those truths and she said,
Speaker 1: I get it, but as a for sere, I just
Speaker 1: have to put my head down work. I don't have
Speaker 1: lines in the sand. So well, it's different when you're
Speaker 1: twenty four and single versus married with kids. Obviously the
Speaker 1: obligations are different. Well, well, I found it to be
Speaker 1: really interesting, and um, I'm glad we got to talk
Speaker 1: about a little bit. Let's I only have you for
Speaker 1: a limited amount of time. Let's jump to everybody's favorite questions,
Speaker 1: starting with so, tell us what you were watching during lockdown?
Speaker 1: What was your Amazon Prime or Netflix favorite shows? I
Speaker 1: don't know what this says about my emotional state. So
Speaker 1: I've definitely evolved a little more, you know, high brow
Speaker 1: versus where I started, is what I'll say. Uh. So,
Speaker 1: at the beginning, I was watching shows like Love Is Blind.
Speaker 1: I don't know, uh And my version of that, by
Speaker 1: the way, was The Gilmore Girls. In the beginning of Lockdown,
Speaker 1: my wife and I streamed the whole Gilmore Girls, which
Speaker 1: I should be embarrassed us to admit, but I'm not.
Speaker 1: And now it's evolved to something a little more sophisticated exactly.
Speaker 1: And then I enjoyed shows like ted Lasso and others.
Speaker 1: Right now I'm watching White Lotus on HBO literally teed
Speaker 1: up for tonight. I hear it's hilarious. Is it as
Speaker 1: funny as everybody says it's Is it as funny sardonic? Yes? Okay,
Speaker 1: is what I would say. You probably won't like anyone
Speaker 1: on the show, right, which is usually a bad sign,
Speaker 1: Like people love succession, I hate everybody on that show.
Speaker 1: When I never got past this second episode, I think
Speaker 1: you'll find I hear similarities, okay, where as something like
Speaker 1: Ship's Creek in the beginning, everybody is totally contemptible, but
Speaker 1: they all become lovable characters over time. So it's funny
Speaker 1: you mentioned Ship's Creek. So so my two go twos
Speaker 1: when I need to just relax and laugh. Stressful day.
Speaker 1: Modern Family so good, so good. I could just watch
Speaker 1: them over not right, and they're they're both. So I'm
Speaker 1: going to come back to Ship's Creek in a couple
Speaker 1: of years and rewatch it um because like the Nightcap
Speaker 1: is it has been these classic sitcoms like UM, thirty Rock,
Speaker 1: and Community. It's like a good way to um. Modern
Speaker 1: Family is terrific. And there's another one that you know.
Speaker 1: It only lasted four seasons, but it's so good called
Speaker 1: Life and Pieces tells the story of a family, an
Speaker 1: extended family. In each episode is three vignettes, one about
Speaker 1: the parents, one about the kids, one about the grandparents,
Speaker 1: and they're all into related. If you like modern family,
Speaker 1: try that. It's like it's just a nice relaxing and
Speaker 1: all the actors and actresses are great in it. It's
Speaker 1: just it's just a sort of show. Um. And I
Speaker 1: was like the last two Ships Creek that my wife
Speaker 1: had a drag me kicking and screaming because the first episode,
Speaker 1: everybody is just so contemptible. But if you give it
Speaker 1: a little breathing room, they grow out of it. Tell
Speaker 1: us about your early mentors who helped to shape your career.
Speaker 1: So I really had several. Unfortunately, I'm sure I'll be
Speaker 1: leaving people out here because I really do feel like it.
Speaker 1: It took a village. But my first mentor was David Cipher.
Speaker 1: He was an insurance analyist. He was the number one
Speaker 1: ranked equity research analysts at First Boston. That's where I started. Uh,
Speaker 1: he was not my first boss. I was working for
Speaker 1: someone else and I was there one night at ten
Speaker 1: o'clock at night, David had hosted a dinner for a
Speaker 1: company I think it was Tokyo Marine and came back
Speaker 1: to the office. I was the only one still there,
Speaker 1: and so he said, I need you on my team. Literally.
Speaker 1: That was our connection, and UM goes to show you
Speaker 1: being in the office has as could have positive results.
Speaker 1: So another female thing here. You know, Historically I would
Speaker 1: have said I was lucky. Now I just say I'm fortunate.
Speaker 1: There's no goiness there. So we connected and I followed
Speaker 1: him to d l J. But he really pushed me.
Speaker 1: He was the one who, when I didn't feel ready,
Speaker 1: had me go meet with portfolio managers and he used
Speaker 1: to say, like, you know all the numbers. You can
Speaker 1: answer all their questions, you know. I So I credit
Speaker 1: my career really to him and uh Tom Letty, who
Speaker 1: ran the morning meeting at d l J. He's a
Speaker 1: wonderful person, but he was very tough and very tough
Speaker 1: on me, and I'm ever grateful to him for that.
Speaker 1: He would let me come in super early. I would
Speaker 1: tell him what I was thinking of saying, and he
Speaker 1: would just say, that's not what you want to say,
Speaker 1: you know, in a in a pretty harsh tone. Um,
Speaker 1: But it forced me to just get better and better
Speaker 1: at it. So those were the two early but you know,
Speaker 1: I have to say, even my time at Blackstone, I've
Speaker 1: learned a lot from just watching Steve and Tony and
Speaker 1: John Byron ween Is on my team and um, you know,
Speaker 1: just the collective experience and different style. So uh, you know,
Speaker 1: from all of them, I would say, just thinking big
Speaker 1: about building your business, and you know, not incrementally. My
Speaker 1: team hears me say this at nausea. I did a
Speaker 1: hundred this year, so next year I'm going to do
Speaker 1: a hundred of ten. No, I want to think about
Speaker 1: how big can this be and how do we get
Speaker 1: there quickly? So that combination of you know, thinking big, impatience,
Speaker 1: really focusing and just being a flex civil thinker and
Speaker 1: you know, an equity research you certainly go through different cycles.
Speaker 1: But at Blackstone I've really learned, uh to not say like, well,
Speaker 1: when a happens, you do be or etcetera. It's really,
Speaker 1: well a happened, But I don't know, maybe we should
Speaker 1: be thinking about X, Y and Z that no one
Speaker 1: else has done. And so it's been expansive for me,
Speaker 1: very interesting. Uh, tell us about some of your favorite
Speaker 1: books and and what are you reading right now. So
Speaker 1: I just finished reading Hamnet, which I don't know if
Speaker 1: you've heard of it, but it's so it's fiction, but
Speaker 1: it's based on Shakespeare's son Hamnet. Notice connection to Hamlet,
Speaker 1: who died when he was eleven, and uh, and around
Speaker 1: Shakespeare's wife. The story itself is fictional because there's just
Speaker 1: very little information on them, but it was beautifully written
Speaker 1: and fatacinating. Um. I often also am drawn to biographies,
Speaker 1: either autobiographies or or others. So uh, the Einstein biography
Speaker 1: and Steve Jobs. I loved Phil Knight's book Shoe Dog. Um.
Speaker 1: On audio, I listened to Ruth Bader Ginsburg Obama, and
Speaker 1: I just love hearing one about for none of them,
Speaker 1: you know, was any of this easy? They all had
Speaker 1: repeated failures, but also Einstein in particular. It was this
Speaker 1: light bulb went on that here's the guy we all
Speaker 1: call a genius. He was and um, we refer to
Speaker 1: people who excelled in in all different subjects geniuses, but
Speaker 1: he really excelled in one. He was nniacally focused on
Speaker 1: one area. He didn't do well in chemistry. He needed
Speaker 1: language tutors. I just thought it was I never really
Speaker 1: thought about that in that was that Walter Isaacson's book,
Speaker 1: because I know he did the Steve Jobs book as well.
Speaker 1: And then I'd say the final category for me is
Speaker 1: just something that's so beautifully written. So my favorite book
Speaker 1: of all time is Crossing to Safety and it's not
Speaker 1: a big story, it's sort of a quiet story, but
Speaker 1: the use of language is just wonderful. There's an autobiography
Speaker 1: I read last summer by David McCullough on the right
Speaker 1: Brothers that if if you're an autobiography fan, I have
Speaker 1: no interest in that particular genre of flying or it's
Speaker 1: just so well done. And if you like autobio, if
Speaker 1: you like biographies, everything mccullo writes is coming away with
Speaker 1: great recommendations. Well thank you. You know. That's the beauty
Speaker 1: of where I sit is I get recommendations from some
Speaker 1: everybody each week, and you're getting the cherry picked versions
Speaker 1: of that um our. Last two questions, what sort of
Speaker 1: a vice would you give to a recent college grad
Speaker 1: who was interested in a career in either private equity
Speaker 1: or investing or finance. So this is the advice that
Speaker 1: I've given my own adult children, and and I give
Speaker 1: to their friends and anyone I speak to um, which
Speaker 1: is when choosing not a job, think about the skill
Speaker 1: set that you want to acquire. Make sure you're going
Speaker 1: to a place where you could really learn, where you
Speaker 1: think it's a quality firm and you're gonna learn from
Speaker 1: quality people. But most importantly, just about how you act,
Speaker 1: how you present. You want to be the person that
Speaker 1: everyone says, I want her on my team. And what
Speaker 1: does that mean. It means you're working hard, You're willing
Speaker 1: to put whatever it takes to get the job done.
Speaker 1: You're focused on the details, you're reviewing everything you know.
Speaker 1: What can your value be as a young person, and
Speaker 1: it's that you know no one's expecting you to have
Speaker 1: the judgment of the partner. But whatever you're doing, just
Speaker 1: make sure it's as excellent as it can possibly be.
Speaker 1: Good good advice. Our final question, tell us what you
Speaker 1: know about the world of investing today that you wish
Speaker 1: you knew thirty years or so, or go thirty years
Speaker 1: ago or so when you were first getting started. So
Speaker 1: when I look back and I think about all of
Speaker 1: the market disruptions during my career, so starting in the
Speaker 1: summer of eighty six, when I began shortly after that
Speaker 1: you had the stock market correction when five points seemed
Speaker 1: like a day. That's can we call that a crash?
Speaker 1: That's more than a correction. That's true. That's true, that's
Speaker 1: a crash. And then you know the SNL crisis, interest
Speaker 1: rate shock of nine for the tech bubble rise and
Speaker 1: then deflation, the global financial crisis, disruption from a pandemic.
Speaker 1: I mean, it's like, wow, floods every couple of years,
Speaker 1: don't So in hindsight, it would have been wonderful to
Speaker 1: know that we get these floods and that you have
Speaker 1: to be nimble and flexible, uh in your thinking and
Speaker 1: anticipatory and understand that you have no idea what's coming
Speaker 1: your way. Uh So I think the other thing is,
Speaker 1: which maybe I did know but proved to be true.
Speaker 1: Finance is in my mind one of the most fascinating
Speaker 1: industries because I mean, think about what I just mentioned
Speaker 1: and all of the the derivative impacts of that and
Speaker 1: inputs from that. I mean, you have to be thinking
Speaker 1: about not just an industry, but what is happening on
Speaker 1: the regulatory front, geo politically, secular trends. You know, we
Speaker 1: were talking about the Internet disrupting retail. You know in
Speaker 1: the nineties, the late nineties. Now it took a while
Speaker 1: to to really um disrupt. But for someone who is
Speaker 1: intellectually curious, there is just so much going on. Huh.
Speaker 1: Quite fascinating. UM. Joan, thank you for being so generous
Speaker 1: with your time. We have been speaking with Joan Solitar.
Speaker 1: She is the global head of Private Wealth Solutions for
Speaker 1: Investing Giant black Stone. If you enjoyed this conversation, well
Speaker 1: check out all of our previous interviews. You can find
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Speaker 1: my weekly column on Bloomberg dot com slash Opinion. Follow
Speaker 1: me on Twitter at rit Halts. I would be remiss
Speaker 1: if I did not thank the crack staff that helps
Speaker 1: put these conversations together each week. Paris Wald is my producer,
Speaker 1: Attica val Bron is my project manager. Tim Harrow is
Speaker 1: my audio engineer. Michael Batnick is my head of research.
Speaker 1: I'm Barry Ridholts. You've been listening to Masters in Business
Speaker 1: on Bloomberg Radio