The Blackstone Group Inc. is an alternative asset management firm specializing in real estate, private equity, hedge fund solutions, credit, secondary funds of funds, public debt and equity and multi-asset class strategies. The firm typically invests in early-stage companies. It also provide capital markets services. The real estate segment specializes in opportunistic, core+ investments as well as debt investment opportunities collateralized by commercial real estate, and stabilized income-oriented commercial real estate across North America, Europe and Asia. The firm’s corporate private equity business pursues transactions throughout the world across a variety of transaction types, including large buyouts, mid-cap buyouts, buy and build platforms, which involves multiple acquisitions behind a single management team and platform, and growth equity/development projects involving significant minority investments in operating companies and greenfield development projects in energy and power, financial services, healthcare, life sciences, enterprise tech and consumer, as well as consumer technologies. Its hedge fund business manages a broad range of commingled and customized fund solutions and its credit business focuses on loans, and securities of non-investment grade companies spread across the capital structure including senior debt, subordinated debt, preferred stock and common equity. The company is publicly listed on NYSE under the ticker “BX”.
Our considerations
Blackstone needs no introduction: the firm is a behemoth. The company is focusing on alternative assets, which are not liquid, and the company is aiming for institutional clients who seek extremely long-term investments, applying a whole different perspective when it comes to the investment approach compared to the other asset managers. Indeed, Blackstone specializes in real estate, private equity, hedge fund solutions, secondary funds of funds, public debt and equity, and multi-asset class strategies. Further, the company typically invests in early-stage companies and provides capital market services.Its closest competitors are KKR & Co., Apollo Global Management, The Carlyle Group, Brookfield Asset Management and Blue Owl Capital.
Well known asset management firms like BlackRock, Vanguard and State Street Corporation have more AUM than Blackstone has, but at the same time they are primarily focused on mutual funds and ETFs, so they aren’t really comparable. Among asset management firms, those focused primarily or exclusively on raising and managing capital to invest in alternative assets must be viewed through the right lens: indeed, that’s the only way we have to appreciate their risks, their strengths and their negative aspects.
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