CAIS Live Conversations, Building With Alts Building Bridges in Private Markets (EP. 5)
Feb 24, 2025
Michael Rees, Co-President of Blue Owl Capital, has a diverse background in chemical engineering and investment banking. He discusses the innovative growth of Blue Owl’s GP stakes business, shedding light on the evolving dynamics of private markets. Rees shares intriguing insights into their strategic expansion into sports investing, particularly in the NBA. He also emphasizes the importance of creative partnerships and a blue-collar ethic in building a resilient business model while expressing his passion for teaching finance and impacting future leaders.
AI Snips
Chapters
Transcript
Episode notes
Unplanned Career Path
- Michael Rees's career path wasn't planned; he initially worked in consulting and investment banking.
- He stumbled into asset management at Lehman Brothers and discovered GP stakes through M&A deals.
Capital Needs in Private Markets
- The private markets industry has become increasingly capital-intensive, requiring firms to seek capital partners.
- The best-performing firms often need capital partners the most, similar to tech or healthcare companies.
GP Stakes Return Profile
- Investing in GP stakes funds offers exposure to private markets, primarily private equity, with some private credit and infrastructure.
- This strategy provides early cash flow due to the immediate distribution of management fees, carried interest, and underlying asset returns.