Has Blackstone Lost Its Edge? 8-21-25

Summary

Episode Overview

Episode Title: Has Blackstone Lost Its Edge?
Podcast: Becker Private Equity & Business Podcast
Host: Scott Becker
Date: August 21, 2025

In this episode, Scott Becker examines whether Blackstone—the world’s largest alternative asset manager—has lost its competitive edge. He analyzes Blackstone’s performance, recruitment prowess, and challenges in the current private equity market, providing context on industry trends and drawing comparisons to peers.

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Key Discussion Points & Insights

1. Blackstone’s Position in Private Equity

• Size and Scale:
  • As of late 2024, Blackstone managed around $1.3 trillion in assets, significantly outpacing competitors like KKR, which manages approximately $635 billion.
    "[00:22] So Blackstone is the biggest. The biggest so far."
• Performance Context:
  • Blackstone is down about 5% year to date, while the S&P is up, but this underperformance isn't isolated to Blackstone.
    • "[00:30] I don't think you could say that's a Blackstone-specific issue. That's really a deal market issue..."
  • The whole M&A and private equity market is experiencing difficulties, particularly in asset divestitures.

2. Market Headwinds for PE Firms

• Challenging Exit Environment:
  • Blackstone is holding onto assets longer than anticipated due to a sluggish market for divestitures.
    • "[00:36] Blackstone still holding lots of positions in lots of things for a lot longer than they expected to originally."
  • These issues are present across the industry and are not unique to Blackstone.

3. Recruitment and Talent Edge

• Elite Recruiting:
  • Blackstone remains a highly prestigious and selective employer.
    • "[00:45] Blackstone is more difficult to get into...than it is to get into Harvard or Harvard Law School."
  • The firm continues to attract the "best and brightest" despite some changes in candidate decision-making.
• Subtle Shifts Noted:
  • Anecdotally, there have been rare instances where top candidates are choosing not to go to Blackstone, which was virtually unheard of in previous years.
    • "[00:55] Anecdotally, we've recently seen a candidate choose not to go to Blackstone who had a chance to go there...something you didn't see that much of years ago."

4. Overall Outlook and Conclusion

• Industry vs. Firm-Specific Challenges:
  • The hurdles Blackstone faces are attributed to broader trends in private equity, not a loss of firm-specific edge.
    • "[01:05] It's not a Blackstone-centric issue. It's more a private equity in general issue."
• Recognition of Excellence:
  • Despite recent anecdotes about top candidate choices, Blackstone retains strong performance and reputation.
    • "[01:15] Blackstone seems to be performing quite well...they will be fine. So hats off to Blackstone and so forth."

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Notable Quotes & Memorable Moments

• On Blackstone’s Prestige:

  • "[00:45] Blackstone is more difficult to get into as an analyst, as an employee...than it is to get into Harvard or Harvard Law School." — Scott Becker

• On Market-wide Headwinds:

  • "[00:30] I don't think you could say that's a Blackstone-specific issue. That's really a deal market issue that the big private equity funds [are]… challenged in terms of divestiture of assets." — Scott Becker

• On Anomalies in Recruitment:

  • "[00:55] Anecdotally, we've recently seen a candidate choose not to go to Blackstone…" — Scott Becker

• Overall Sentiment:

  • "[01:15] Blackstone seems to be performing quite well...they will be fine. So hats off to Blackstone and so forth." — Scott Becker

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Timestamps for Important Segments

• [00:00-00:30]: Blackstone’s size and performance overview
• [00:30-00:45]: Market challenges and holding assets longer
• [00:45-01:00]: Recruitment standards and selectivity
• [01:00-01:20]: Anecdotal recruitment shifts and concluding thoughts

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Summary & Takeaways

Scott Becker’s analysis suggests that Blackstone has not lost its edge. Despite lagging S&P 500 returns and isolated instances of star candidates declining job offers, the firm remains the industry leader in scale and talent acquisition. The challenges it faces are reflective of broader private equity market headwinds, not internal shortcomings. In Becker's view, Blackstone continues to set the benchmark in the industry.

Transcript

[A]

This is Scott Becker with the Becker Business Podcast and the Becker Private Equity Podcast. Today's discussion is has Blackstone lost its edge? So Blackstone is the largest operator of alternative assets, large alternative asset manager. He had, as of the end of 2024, about 1.3 trillion assets under management. By contrast, KKR has about 635 billion assets under management or somewhere in there. So KK. So Blackstone is the biggest. The biggest so far. Blackst is down about 5% year to date. At a time when the S and P is up, I don't think you could say that's a Blackstone specific issue. That's really a deal market issue that the big private equity funds in the entire M and A universe is a little bit challenged in terms of divestiture of assets. Blackstone still holding lots of positions in lots of things for a lot longer than they expected to originally. He hasn't lost its edge in recruiting. Here's the issue in general, Blackstone is more difficult to get into as an analyst, as an employee, as a. For a position here, than it is to get into Harvard or Harvard Law School. So from all practical purposes or all statistical data, Blackstone is still doing an incredible job on the recruiting side and getting the best and the brightest. Anecdotally, we've recently seen a candidate choose not to go to Blackstone who had a chance to go there, you know, which is something you didn't see that much of years ago. But. But I think when you look at this, overall, Blackstone is facing some of the same headwinds the private equity industry is facing. It's not a black, Blackstone centric issue. It's more a private equity in general issue. So I would say, you know, all things being equal, notwithstanding the anecdotal discussions we've had with people, Blackstone seems to be performing quite well. And even though the candidate they lost is a rock star, one of the greatest of the greats, they will be fine. So hats off to Blackstone and so forth. Thank you for listening to the Becker Business podcast and the Becker Private Equity Podcast.