Summary
- Long-term winner in alternative asset management.
- $152bn of firepower to deploy in an attractive environment for capital allocation.
- Culture of the firm and access to talent is best-in-class.
Company Overview & Strategic Advantages
Blackstone (BX) is the world's largest alternative asset manager with $540 billion in AUM across private equity, hedge funds, real estate and private credit. Such is its prowess, Blackstone is actually the world's largest investor in leveraged loans and real estate. The firm has several competitive advantages:
- Blackstone has a strong industry reputation and is one of a handful of top-tier private equity houses clients feel comfortable committing large sums to for extended multi-year periods. Blackstone tends to feature prominently in the 'beauty parade' for selecting a private equity investment advisor.
- The firm clearly has the ability to attract and retain leading investment talent and is highly focused on assembling a broad array of skill-sets to assist its portfolio companies. BX has nearly 100 functional experts in areas such as pricing, digital marketing and procurement. Its team of data scientists helps its portfolio companies monetize their data. The ability to source and purchase raw materials at scale across its companies is highly advantageous.
- On a look-through basis the firm has unique insights into a range of industries globally which allows the investment team to synthesize information and improve its investment underwriting.
- Blackstone is not a passive owner of assets and has a track record of driving value through strategic engagement and ongoing dialog with management teams.
- By virtue of its size and reputation, Blackstone has strong access to deal flow and is widely perceived as the 'gold standard' investment partner.
The firm aims to deliver institutional quality funds to investors across alternative asset classes accompanied with service excellence.
Performance has been strong. According to a recent interview with its COO, the firm has generated 14% compound annual returns in private equity and 15% in real estate in its 40 years since inception.
