The NYT had an article about alternative investment firms. It wasn’t materially insightful. Here’s the best passage that I found:
To that end, the journalists that cover the alts tend to lump them all together. They started from the same place, but are on very different paths. Within 5 years I expect them to be notable different to journalists, and within 10 years to be in different “categories” altogether. Here’s the quick hit-list on my expectations:
Blackstone: Will continue down the path of becoming equity beta of large private market subsections. A continuation of their thrust into industrial real estate, multifamily real estate, entertainment / experience focused real estate, growth equity, etc. The razor sharp focus on returns inevitably has to degrade as they trade growth and scale that dive the stock price.
Apollo: Will continue down the path of becoming the next iteration of GE Capital, a shadow bank that ceases to exist in its prior skin. The focus is on debt, not equity. I think it’s possible that they spin off their equity units as the debt side of the house blots them out from the sun.
KKR: They seem like they are playing both strategies that Apollo and Blackstone are pushing. At some point they either commit to go all in on one or be a second rate mixed bag player. Their giant balance sheet virtually guarantees complexity that the market does not like and I expect commentators to harp on the ‘discount to intrinsic value’ for years going forward.
That’s just three of a broader set of public alt firms. But you see my point.