Exploring Growth in Asset-Based Finance and Private Credit

Today marks the launch of a new show on Alt Goes Mainstream: Going Public with Evercore’s Glenn Schorr.

17 years ago, there wasn’t a single alternative asset manager that was part of the public markets. Today, not only are a number of the industry’s largest firms public, but in 2024, the industry’s largest alternative asset manager, Blackstone, entered the S&P 500.

Understanding the inner workings, strategic moves, and financial performance of the industry’s largest players can help to explain many of the trends that are making alternatives become mainstream and these firms become mainstays in the financial services ecosystem.

Going Public will make private markets more public with expert analysis.

Glenn Schorr is a Senior MD and Senior Research Analyst at Evercore ISI, where he covers brokers, banks, asset managers, and trust banks as an analyst. 

He has covered financials since 2000 and started coverage of alternative asset managers when the first firms went public.

He’s consistently come up as one of the most thoughtful and well-respected analysts in the space. He balances deep research with a creative flair (just read one of the titles of his research reports and you can see his love of the game). He’s been named to Institutional Investor’s All-America Research Team for his coverage, most recently ranking #2 and runner up in 2023, #1 and #2 in 2022. Prior to Evercore, Glenn was a Senior MD at Nomura, serving as the lead financials analyst. 

Listen in as Glenn shares market stories, the evolution of alternative asset managers as businesses, the biggest and most exciting trends in private markets based on what the industry’s largest players are doing, and we go “around the horn” for his analysis on the publicly traded firms. 

Show Notes

00:38 Introduction to the Going Public Series and award-winning Wall Street Analyst, Glenn Schorr

01:54 Glenn's Career Journey

03:08 The Early Days of Alts Managers Going Public

03:26 Skepticism and Challenges in Going Public

04:06 Investor Skepticism and Challenges

07:00 Transformation and Tipping Points

09:03 Structural Tailwinds and Market Trends

10:57 The Decision to Go Public vs. Staying Private

12:39 Ambition and Vision in Asset Management

14:51 The Distribution vs. Manufacturing Debate

17:03 Lessons from Traditional Asset Management

18:55 Discipline and Growth in the Alts Market

20:03 The Future of Public and Private Markets

20:50 The Role of Distribution in Asset Management

21:59 Success Stories and Acquisition Strategies

23:02 Manufacturing Competency vs. Acquisitions

24:40 The Rise of Private Markets

26:07 How Alternative Managers Make Money

27:02 Valuation Factors for Alternative Managers

28:44 Profitability and Margins in Asset Management

29:23 Building a Business: Costs and Competitive Advantages

29:50 The Moat of Success in Business

30:15 Challenges for Traditional Asset Managers

30:56 The Importance of Vision and Technology

31:22 Scaling a Business with Proven Success

31:40 Insurance Asset Management: Strategic Moves and Structural Advantages

32:17 Structural Advantages in Asset Management

33:05 The Rise of Private Credit Managers

34:43 The Impact of Interest Rates on Private Credit Managers

35:32 Navigating Rate Sensitivity in Capital Markets

38:25 Deployment and Monetization in Asset Management

39:08 The Challenge of Dry Powder in Private Equity

41:14 The Role of Deployment in Investment Success

41:46 The Resilience of Publicly Traded Alts Managers

43:26 Spotlight on Blackstone's Growth and Innovation

46:38 KKR's Global Expansion and Innovation

48:41 Apollo's Market Leadership and Challenges

50:11 Blue Owl's Strategic Investments and Challenges

53:56 TPG's Public Transition and Growth

55:11 Carlyle’s Progress and Future Challenges

56:11 Looking Ahead: Key Trends and Expectations

Disclosures

Evercore ISI

Glenn Schorr

Company Coverage and Disclosures

Ticker      Company

APO         Apollo Global Management, Inc.

BAC         Bank of America Corporation

Glenn Schorr holds a long position in equity securities of Bank of America Corporation.

BK            Bank of New York Mellon Corp.

Glenn Schorr holds a long position in equity securities of Bank of New York Mellon Corp.

BLK          BlackRock, Inc.

Glenn Schorr holds a long position in equity securities of BlackRock Inc.

BX            Blackstone, Inc.

Blackstone, Inc. is a client of Evercore LLC, and Evercore LLC has provided investment banking services to Blackstone, Inc. in the last 12 months.

Evercore ISI or an affiliate expects to receive or intends to seek compensation for investment banking services from Blackstone, Inc. within the next three months.

An employee, employee's immediate family member, director or consultant of Evercore ISI or one of its affiliates (but not the covering research analyst or a member of the covering re advisory board member of Blackstone, Inc..

Evercore ISI or an affiliate has received compensation from Blackstone, Inc. for investment banking services in the last 12 months.

Analyst has a financial interest in a private equity fund managed by Blackstone, Inc.

Glenn Schorr holds a long position in equity securities of Blackstone, Inc.

OWL         Blue Owl Capital, Inc.

Evercore ISI or an affiliate has acted as a manager or co-manager of a public offering of securities by Blue Owl Capital, Inc in the last 12 months.

Blue Owl Capital, Inc is a client of Evercore LLC, and Evercore LLC has provided investment banking services to Blue Owl Capital, Inc in the last 12 months.

Evercore ISI or an affiliate has received compensation from Blue Owl Capital, Inc for investment banking services in the last 12 months.

BSIG        BrightSphere Investment

C               Citigroup, Inc.

An employee, employee's immediate family member, director or consultant of Evercore ISI or one of its affiliates (but not the covering research analyst or a member of the covering re advisory board member of Citigroup, Inc.

Glenn Schorr holds a long position in equity securities of Citigroup, Inc.

BEN          Franklin Resources, Inc.

Glenn Schorr holds a long position in equity securities of Franklin Resources, Inc.

GS            Goldman Sachs Group Inc.

IVZ           Invesco Ltd.

JPM        &nb...