RITHOLTZ: Youre like late 20s at this time? What is . He is also a member of the Board of Trustees of Georgetown University, is a trustee of the Tate Foundation, serves on the board of Year Up, an organization focused on youth employment, and serves on the Board of Trustees of Trinity School in New York City. We use cookies for a number of reasons, such as keeping The Information reliable and secure, personalizing content and ads, providing social media features and to analyze how our sites are used. And as an asset class, theyve performed extremely well, with low incidence of loss, good returns. And for a while, it looked like the lower quality the stock was, the better it did. BARATTA: Right into the thick of it, trying to figure out what a two younger might my colleague, David Blitzer, I think he was maybe 31. Well, if you do this if youve been doing this long enough, which fortunately, I have, since really 1095, you see different cycles, and you see what happens when capital becomes cheap and money becomes easy, and interest rates are lower, not really a factor. RITHOLTZ: Post Brexit, is that the driver? I know the Savoy is in the U.K. and in Europe. We bought their Climate Technologies business called Copeland. All of our earlier podcasts on your favorite pod hosts can be found here. 2013-2023 The Information. RITHOLTZ: Im halfway through it, really loving it. It was more of a cottage industry. BARATTA: Yeah. And they had like bottles of Bordeaux on the conference room table. So taking advantage of the currency declining, a lower cost base in India, but revenues denominated in dollars or euros. So the rate of increases is declining. The Tate Foundation is the private philanthropic arm of the Tate that helps fund special projects, whether its exhibitions or building new buildings, you know, the big Tate Modern gallery was, in large part, funded by private donations. So its a whole broad spectrum of investing in the energy complex focused on the transition from hydrocarbons to renewable sources. And so, we bought the pub business. RITHOLTZ: So here we are, enter the first quarter 2023, whats the environment look like relative to mid-2021? Were down to our last two questions, what sort of advice would you give to a recent college grad who was interested in a career in private equity? And, you know, I needed to earn some money and I was adept in finance. And the cost of financing and the quantum isnt the biggest driver of our returns. Thank you, Joe, for being so generous with your time. Im assuming that all these different names all come from different work products, different strategies, different funds, or is just everybody getting this wrong? You had Lehman almost go bust, I think, around that time for maybe the first or second time. Two years ago, Joe Baratta couldnt figure out what Blackstone, the private equity giant he worked for, should do for its next move in media and entertainment. You know, that did not happen when we were kids. You end up in London. You have your way. BARATTA: Like, it probably isnt going to happen forever. And like I said, those companies arent too big to make good returns with. Mr. Joseph Patrick Baratta, also known as Joe, has been the Global Head of Private Equity at The Blackstone Group, Private Equity Group since July 2012. Inflation is significant. But its nothing like it is today. The firm had had , RITHOLTZ: Do you need language skills in England, or is it . BARATTA: and nice calling card. It wasnt very long after the handover of Hong Kong to China, like a lot of things were changing in both the U.K. and Europe. RITHOLTZ: So heres the really interesting observation that youre making, Blackstone has boots on the ground in all these different sectors. BARATTA: Its certainly investable for venture investors and smaller guys who are willing to sort of dig holes in the ground and hope something comes out. You can stream and download our full conversation, including any podcast extras, iTunes, Spotify, YouTube, Stitcher, Google, Bloomberg, and Omny. We find great management teams. What are you looking at that might not have been on the table a decade ago? Both in terms of the aggregate revenue of our company, size of our portfolio, were probably now something like 150 total investments, many hundreds of billions of revenue, hundreds of thousands of employees if you add up all of the companies in which were invested. Its a solution and source of a problem, sort of. So we were working with our real estate guys in health care facilities, and visitor attractions, and theme parks. RITHOLTZ: So eventually you leave Morgan Stanley, you ended up at Tinicum Incorporated and McCown De Leeuw & Company. India is very attractive. I was 29. Sebastian Escobar is my audio engineer. Its where we play. So not a lot of money, you know, get engaged in the arts and really important cultural institution; where in the U.K., its less sort of focused on the elite and more focused on like the democratization of art and culture for the people of the U.K., and I really identified with that. BARATTA: Not a bit, not a bit. Happy to be here. He also sits on the firms Management Committee. At that point in my career, I was 20 I think 27 years old, I wanted to attach my myself to a firm that I thought really had a lot of growth potential, where I could learn from the best people in the industry, and that certainly was what I found there. RITHOLTZ: How did you first get involved with them? You got to get it elsewhere. My friend and former Morgan Stanley analyst, colleague, Chad Pike, ran our European real estate stuff. And then it evolved. So you move to the U.K. RITHOLTZ: Youre an hour to hop from all the key places . BARATTA: Well, I would say in my 25-year history at Blackstone, there were certain industries that were growth industries that we were investing in in the mid 90s and late 90s and early 2000s, that now are no longer investable. Weve had a big business there for a long time and we see really attractive assets. While Qatar has reportedly spent $200 billion or more, most nations are now unwilling to spend a fraction of that on money-losing mega-events like the World Cup or the Olympics. RITHOLTZ: Really interesting. Meaning, your team, your group would be a Fortune Top 20 Company. My sense is that AI and chatbots, and the recent, you know, multibillion dollar acquisitions that have been done by firms like Microsoft and Google, this doesnt seem to be that sort of ephemeral hype story. In London, in September, I had him come to talk about like what it means to be from where you should be deriving your happiness. And so, yeah, and weve had limited partners in our funds whove been with us since the early 90s now and keep re-upping because we deliver a good return for their beneficiaries. And by the time theyre 30, they wanted to have, like, declared victory on their career. In the long run. He is also a member of the Board of Trustees of Georgetown University; is a trustee of the Tate Foundation; and serves on the board of Year Up, an organization focused on youth employment. Joe Baratta, Blackstone's global head of private equity, says even though loan markets are not really open right now Blackstone is well-suited to have access to capital. And heres this like schmuck from Sacramento, like, you know, 30 years old, like pitching him on why wed be a good partner for him. Not to say like we executed on that vision perfectly, I mean, we would have made some mistakes, but we definitely became much more cautious when the bull market really ramped up, in particular, post COVID, when not only did you have the low rates which the Fed double down on, you had this huge transfer payment from the federal government . RITHOLTZ: So you lasted two or three years, and then you get tapped to go to London in 2001. You see these things before they start to show up in the economic data. They introduced me to the head of a significant private equity firm in Europe. These are physical assets. I would be remiss if I did not thank the fine team who help put this conversation together each week. From Strength to Strength: Finding Success, Happiness, and Deep Purpose in the Second Half of Life by Arthur C. Brooks. Theres plenty of great smaller banks whose business strategy is to serve smaller and medium-sized businesses. And the total AUM of our private equity business, AUM assets under management is roughly $80 billion, $90 billion. Lets start out with just a little background on your career. RITHOLTZ: So you end up at Blackstone in 1998, at a time when public equity prices became a little unmoored and were on the way up to a real bubble. I will learn something, and Ill have something else to do on the other side of it. RITHOLTZ: Theres still textbooks in schools. We all wanted to get there fast, but I think its entered a new level. The first job for Morgan Stanley was McCown De Leeuw. Markets never sleep, and neither does Bloomberg News. So a big part of what we do is trying to figure out where we dont want to invest, and whats going to be dislocated by ubiquitous broadband back in 2005, 06, 07, and now, AI with a rate of sophistication of that technology. Ive been hearing recession chatter it seems like for six months, at least. You can stream and download our full conversation, including any podcast extras, iTunes, Spotify, Stitcher, Google, Bloomberg, and Omny. Fast. By selecting the relevant option, you certify that it accurately reflects your residency. BARATTA: I think starting with the fundamentals, you know, the economy is quite sound. It kind of helped us get off the ground, so to speak. Joseph Baratta Age : 51 Public asset : 567,113,101 USD Country of residence : Unknown Linked companies : Blackstone Inc. - Merlin Entertainments plc Biography of Joseph Baratta Joseph Patrick Baratta is Director & Head-Global Private Equity at Blackstone, Inc. and on the board of 13 other companies. So we operate from a board level and really focus on key strategic and risk management variables. BARATTA: I mean, theres no question that financing costs are higher, both debt and equity, which is a healthy thing because I think the global cost of capital was too low, induced by super low rates and capital allocation to riskier assets, institutional investors chasing return. You know, the blockchain, when it came people like, hmm, Im always like, whats the use case? The modern day striker has to be many things to make it to the top. RITHOLTZ: Really quite interesting. I mean, this is the ultimate French establishment. We recently announced to take private of a technology company called Cvent, which is publicly traded. It feels like were very early stages of transitioning to being able to pull up somewhere and spend 10 minutes charging the car to get you another 100 miles or so. RITHOLTZ: So lets talk about some of those different types of funds. What are some of your favorites? BARATTA: I think private credit has filled the hole for these smaller businesses, but really not on the full banking suite. I recognized that it was still pretty early in the development and there should be a lot of growth in these firms. BARATTA: Even more mature companies. And I was like, geez, okay, well . And I think, largely, you want to avoid highly regulated industries, where youre relying on the government to do something. Business models are changing. The big TV companies, such as ViacomCBS and Discovery, were bleeding viewers as people cut the cord to cable television and streaming powerhouses like Netflix grew ever bigger. As an example, the firm invested in Reese Witherspoons production company Hello Sunshine versus the legacy cable and satellite firms. BARATTA: Yeah. Blackstone has raised the largest-ever long-hold private equity vehicle as interest in the strategy from both investors and managers increases.. We also discuss how Private Equity has developed over the past three decades from a small $50 billion alternative to a massive multi-trillion dollar investment sector. Since Sundar Pichai became CEO of Googles parent company, Alphabet, in 2019, he has been honest with colleagues about the difficulties of overseeing a sprawling conglomerate thats under constant strain from internal power struggles, regulators and rebellious employees. RITHOLTZ: I was waiting for you to say, and it was 10:00 a.m. and they broke open the bottles of Bordeaux. So I actually think, at the large end of the private equity market, were undercapitalized. Hes way more interesting than me. And David and I moved over to do the private equity stuff. How do you keep all that straight? Mr.Barattahas served on the boards of many past Blackstone portfolio companies and currently serves as a member or observer on the boards of. RITHOLTZ: So lets talk about geographies, and lets talk about sectors. These are people who were, you know, in their late 20s, early 30s, oldest maybe mid-30s, and they kind of grew up with the firm, and they were able to be the translator, so to speak, both physically and culturally, in some of these other countries. Our final question, what do you know about the world of investing today you wish you knew back in the 90s when you were first getting started? No, no, thats I mean, the firm is called Blackstone, period. I mean, inflation is higher than normal, but thats going to come down. BARATTA: into peoples pocketbooks, which massively accelerated the economy and rates stayed low. Now, the funniest story I can remember is, in these early days, when we were out trying to introduce ourselves to the local private equity firms, I went to Paris and went to Lazard Freres, which was you know, that is the bastion of, like, French establishment business. Youre still dealing with people in Brussels, and people in Paris, and people in Milan.
Kinetic Energy Of A Proton,
Stabbing In South Ockendon Today,
Stratford Borough Clerk,
Who Plays Ncis: Hawai'i Jane Tennant Ex Husband,
Articles J