Scale is our Greatest Advantage

I founded Blackstone with my partner Pete Peterson in 1985 with $400,000 of start-up capital. We sent out 450 personal announcements of our new venture and published a full-page newspaper ad, with the expectation that the phone would start ringing off the hook. It was a humbling experience when no one called, other than a few people wishing us luck. Fortunately, we persevered, and we were ultimately successful.

Looking at Blackstone today, I feel an immense sense of pride. We’ve established an unparalleled global platform of leading business lines, offering over 70 distinct investment strategies. We’ve built extraordinary trust with our investors over four decades and delivered for them in good times and bad, generating $300 billion of aggregate gains, with minimal losses. Our performance has helped secure retirees’ pensions; fund students’ educations; pay healthcare benefits; and protect and grow the savings of individual investors. We are tremendously proud of the role we’ve played in driving these outcomes.

This milestone is also reflective of Blackstone’s distinctive positioning as the leading innovator in our industry. At our founding, we determined that building a great company required us to be in a continuous innovation mode. Our original strategic plan was to start in corporate advisory and then quickly move into private equity, followed by a succession of other asset management businesses over time. We only entered a new area when we saw the opportunity to generate great risk-adjusted returns for our customers; we identified a remarkable leader; and the new area created intellectual capital that benefitted the rest of the firm. Today, nearly all of our major business lines – from earlier expansion into real estate, hedge funds and credit to more recent adds like infrastructure, life sciences, and more – are leaders in their respective asset classes, with exceptional long-term performance.

There are many advantages that come from our unique scale. With our portfolio of over 230 companies, 12,000 real estate assets and one of the largest lending businesses in the world, we believe we have more information than anyone competing with us. We specialize in the production and analysis of enormous amounts of data, which we review every week in our Monday meetings with each of our major product lines. This process helps us identify trends before others and adjust where we invest our clients’ capital. Our focus on data aggregation and analysis also led us to establish our own data science group in 2015. We started building a team of exceptional data scientists, which numbers over fifty today, and we are rapidly and significantly expanding our capabilities in artificial intelligence. Blackstone fortunately is in an enviable position in the alternative asset world, with an eight-year head start in this field, and we are committed to further expanding our leadership position as quickly as possible.

Our growth, along with our commitment to meritocracy, have also allowed us to attract and retain great talent. Many of the best people in the world want to work at Blackstone. This year we had 62,000 unique applicants for 169 first-year analyst positions, equating to a selection rate of less than 0.3%. Getting an entry-level job at Blackstone is twelve times harder than getting into Harvard. I doubt I’d be able to be hired today!

Our mission since 1985 is to be the best in the world at what we choose to do. Even as we’ve grown, we’ve never strayed from this mission or from the core values that have defined us, including excellence, integrity, meritocracy, teamwork and dedication to serving our customers.

Blackstone is an extraordinary place, and our prospects are accelerating.