Delivering Results, Achieving Scale
From all of us at Blackstone Private Wealth Solutions (PWS), we would like to take this opportunity to wish you and your loved ones health and prosperity in 2022. We continue to work hard to maintain your trust, expand resources dedicated to helping your business, and listen to your feedback on what we can do even better.
We would also like to update you on some very exciting developments across our business.
We believe our success in many ways is about scale – both delivering the scale of Blackstone as a firm to our clients, and helping our clients achieve scale in their own business growth. In an environment of market turbulence, concerns about the impact of inflation and the prospect of higher interest rates, Blackstone seeks to be a careful steward of your clients’ capital. There has been a sea change in investing, and we believe that more investors are gravitating to alternative asset classes to achieve their long-term goals.1 Many advisors and investors are seeking replacements for some of the more than $6 trillion of corporate fixed income and municipal bonds that sit in investor accounts in the U.S. alone.2 They are responding to the same environment that Private Wealth Solutions investment strategists Byron Wien and Joe Zidle highlighted in their latest quarterly webcast, in which they predict a rise in the 10-year Treasury yield to 2.75% during 2022 and a gain in the U.S. Consumer Price Index of 4.5%.
With a strong record of deploying capital at scale in these markets, Blackstone has been at the forefront of these changes. Blackstone ended the year with record assets under management of $881 billion and, within that total, retail assets represented $192 billion, also a record.
A Year’s Accomplishments, Advancing into 2022
Total firm assets under management
Investor capital deployed by the firm in 2021
Retail assets under management
Highlights of 2021:
- Firmwide, Blackstone delivered real value to clients with record realization activity of $77 billion and new capital deployment of $144 billion. Click here to read “Blackstone: the First Trillion is the Hardest” in the Financial Times’ Lex column.
- Across PWS during 2021, we undertook more than 42,000 client meetings (in-person and virtually), made more than 70 new hires, opened two new offices in Europe, and added operations in New York, London, Paris, Switzerland, Hong Kong, Singapore, and Japan.
- The year’s ESG milestones included:
- The buildout of an ambitious emissions reduction program for Blackstone portfolio companies.3
- Several high-profile investments in women-led companies as part of our commitment to women’s entrepreneurship.
- Blackstone’s incoming 2021 analyst class achieved 41% female representation globally and 49% racially diverse representation in the U.S., reflecting the ongoing success of the firm’s Diversity, Equity & Inclusion initiative.4
- Instituting a goal of one-third diverse representation on portfolio company boards for control investments across the U.S. and Europe.5
We believe these results reflect Blackstone’s large-scale thematic approach to deploying capital toward areas of the economy with outsized secular growth, coupled with robust portfolio management capabilities. President and COO Jon Gray highlights these achievements and more in his recent interview on CNBC.
High Conviction, Thematic Investing
Blackstone believes its portfolio overall is well-positioned for future cycles. The firm has been harnessing the power of thematic investing in megatrends and has identified sectors with strong secular tailwinds. Here are three transactions which, in our view, illustrate Blackstone’s investment themes particularly well:
Category-Creating Brands: Blackstone acquired a majority stake in SPANX, the mission-driven womenswear brand founded by Sara Blakely in 2000, at a $1.2 billion valuation. As a leading apparel, activewear and intimates brand, SPANX pioneered the shapewear category. Blackstone was the chosen partner for entrepreneur Blakely, whose mission is to help empower women globally. Blackstone’s investment in SPANX as well as recent investments in Supergoop!, Hello Sunshine, and Bumble underscore our dedication to partnering with women-led businesses.
Content Creation: Blackstone affirmed its commitment to driving innovative content creation by backing and supporting the launch of Candle Media, a next-generation media company run by leading entertainment executives Kevin Mayer and Tom Staggs. The company has established its initial scale via its recent investments in Hello Sunshine, the mission-driven media company founded by Reese Witherspoon in 2016; Moonbug Entertainment, a fast-growing kids’ digital content company behind popular shows including CoComelon (#1 kids program on YouTube and Netflix), Blippi, and Little Baby Bum; and Westbrook Inc., the media company founded by Jada Pinkett Smith, Will Smith, Miguel Melendez, and Ko Yada.
Professional Services: Blackstone Credit played a pivotal role in the acquisition of the Dovel Group, a federal government IT consulting firm and leader in the proprietary AI/machine learning space, by Guidehouse, a portfolio company of Veritas. Specifically, the firm provided $1.9 billion of a $2.85 billion first lien facility (consisting of a $2.65 billion first lien term loan and $200 million revolver) to support the acquisition.6 Guidehouse is a leading global provider of consultancy services to public and government sectors with expertise in management, technology, and risk consulting.
Staying Connected With Blackstone
As you position your business for the future, we are here to partner with you – and we are grateful for your trust.
We wish you and your family health and well-being, and continued good fortune in 2022.
Global Head of Private Wealth Solutions
Past performance is not indicative of future results. There can be no assurance that any Blackstone fund or investment will achieve its objectives or avoid substantial losses
- Money Management Institute, as of 2021.
- Morningstar, as of 1/26/2022.
- We will seek to reduce carbon emissions by 15% in the aggregate within the first three years of ownership across all new investments where we control energy usage.
- “An Integrated Approach to ESG,” Blackstone, November 2021.
- Applies to control investments made after January 1, 2021. Target of one-third (1/3) diverse representation on portfolio company boards starting in the US and Europe.
- Split between $1.77 billion of the first lien term loan and $133.6 million of the revolver.
Important Disclosure Information
This webpage does not constitute an offer to sell, or a solicitation of an offer to buy, any security or instrument, or a solicitation of interest in any Blackstone vehicle, account or strategy. If any such offer is made, it will only be by means of an offering memorandum or prospectus, which would contain material information including certain risks of investing including, but not limited to, loss of all or a significant portion of the investment due to leveraging, short-selling, or other speculative practices, lack of liquidity and volatility of returns. The foregoing information has not been provided in a fiduciary capacity under ERISA, and it is not intended to be, and should not be considered as, research or impartial investment advice.
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Case Studies. The selected investment examples, case studies and/or transaction summaries presented or referred to herein may not be representative of all transactions of a given type or of investments generally and are intended to be illustrative of the types of investments that have been made or may be made by a Fund in employing such Fund’s investment strategies. It should not be assumed that a Fund will make equally successful or comparable investments in the future. Moreover, the actual investments to be made by a Fund or any other future fund will be made under different market conditions from those investments presented or referenced in the Materials and may differ substantially from the investments presented herein as a result of various factors. Prospective investors should also note that the selected investment examples, case studies and/or transaction summaries presented or referred to herein have involved Blackstone professionals who will be involved with the management and operations of a Fund as well as other Blackstone personnel who will not be involved in the management and operations of such Fund. Certain investment examples described herein may be owned by investment vehicles managed by Blackstone and by certain other third-party equity partners, and in connection therewith Blackstone may own less than a majority of the equity securities of such investment. Further investment details are available upon request.
Epidemics/Pandemics. Certain countries have been susceptible to epidemics which may be designated as pandemics by world health authorities, most recently COVID-19. The outbreak of such epidemics, together with any resulting restrictions on travel or quarantines imposed, has had and will continue to have a negative impact on the economy and business activity globally (including in the countries in which the Funds invest), and thereby is expected to adversely affect the performance of the Funds’ Investments. Furthermore, the rapid development of epidemics could preclude prediction as to their ultimate adverse impact on economic and market conditions, and, as a result, presents material uncertainty and risk with respect to the Funds and the performance of their Investments.
ESG Investing. While Blackstone believes ESG factors can enhance long-term value, Blackstone does not pursue an ESG-based investment strategy or limit its investments to those that meet specific ESG criteria or standards (except with respect to products or strategies that are explicitly designated as doing so in their Offering Documents or other applicable governing documents). Any such considerations do not qualify Blackstone’s objectives to maximize risk adjusted returns.
Forward-Looking Statements. Certain information contained in the Materials constitutes “forward-looking statements,” which can be identified by the use of forward-looking terminology or the negatives thereof. These may include financial estimates and their underlying assumptions, statements about plans, objectives and expectations with respect to future operations, and statements regarding future performance. Such forward-looking statements are inherently uncertain and there are or may be important factors that could cause actual outcomes or results to differ materially from those indicated in such statements. Blackstone believes these factors include but are not limited to those described under the section entitled “Risk Factors” in its Annual Report on Form 10-K for the fiscal year ended December 31, 2020, and any such updated factors included in its periodic filings with the Securities and Exchange Commission, which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in the Materials and in the filings. Blackstone undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.
Highly Competitive Market for Investment Opportunities. The activity of identifying, completing and realizing attractive investments is highly competitive, and involves a high degree of uncertainty. There can be no assurance that a Fund will be able to locate, consummate and exit investments that satisfy its objectives or realize upon their values or that a Fund will be able to fully invest its committed capital. There is no guarantee that investment opportunities will be allocated to a Fund and/or that the activities of Blackstone’s other funds will not adversely affect the interests of such Fund.
No Assurance of Investment Return. Prospective investors should be aware that an investment in a Fund is speculative and involves a high degree of risk. There can be no assurance that a Fund will achieve comparable results, implement its investment strategy, achieve its objectives or avoid substantial losses or that any expected returns will be met. A Fund’s performance may be volatile. An investment should only be considered by sophisticated investors who can afford to lose all or a substantial amount of their investment. A Fund’s fees and expenses may offset or exceed its profits.
Opinions. Opinions expressed reflect the current opinions of Blackstone as of the date appearing in the Materials only and are based on Blackstone’s opinions of the current market environment, which is subject to change. Certain information contained in the Materials discusses general market activity, industry or sector trends, or other broad-based economic, market or political conditions and should not be construed as research or investment advice.
Reliance on Key Management Personnel. The success of a Fund will depend, in large part, upon the skill and expertise of certain Blackstone professionals. In the event of the death, disability or departure of any key Blackstone professionals, the business and the performance of a Fund may be adversely affected.
Third-Party Information. Certain information contained in the Materials has been obtained from sources outside Blackstone, which in certain cases have not been updated through the date hereof. While such information is believed to be reliable for purposes used herein, no representations are made as to the accuracy or completeness thereof and none of Blackstone, its funds, nor any of their affiliates takes any responsibility for, and has not independently verified, any such information.
Trends. There can be no assurances that any of the trends described herein will continue or will not reverse. Past events and trends do not imply, predict or guarantee, and are not necessarily indicative of, future events or results.