Masters in Business: Alternate Investing with Kristin Olson

Podcast: Masters in Business
Host: Barry Ritholtz (Bloomberg)
Guest: Kristin Olson, Global Head of Alternatives for Wealth, Goldman Sachs
Date: November 12, 2025

Episode Overview

This episode of Masters in Business features a deep dive into the world of alternative investments with Kristin Olson, a 27-year veteran and Global Head of Alternatives for Wealth at Goldman Sachs. Barry Ritholtz and Olson explore how the alternatives space — covering private equity, private credit, hedge funds, and real assets — has evolved, the growing role of alts for individual investors, practical challenges of allocation and manager selection, and the trends shaping the future. The conversation also delves into survey insights, the shifting behavior of wealthy investors, generational differences, and advice for newcomers to the field.

Key Discussion Points & Insights

1. Kristin Olson’s Career Path and Background

• Straight from College to Goldman Sachs:
  Olson joined Goldman Sachs after graduating from Georgetown, initially in investment banking, before gradually moving to the world of alternatives.

  “I was fortunate enough through the interview process to land at Goldman Sachs... a fantastic place to start my career in investment banking in the Financial Institutions group.” (02:14)

• The Pivot to Alternatives:
  Her route was unconventional, briefly helping with goldman.com at the dawn of online investing. The dot-com bust nudged her toward the “special investments group,” Goldman's early alternatives business.

  “I didn’t know anything about alternatives... The seat I got put into at the time was called our special investments group. So that's what we called alternatives back then.” (04:44)

• Longevity at Goldman Sachs:
  Olson has spent 27 years at Goldman, crediting the people and the dynamism of alternatives for keeping her engaged.

  “It’s all about the quality of the people and the engagement. I think I got lucky falling into a really interesting part of Goldman Sachs.” (13:18)

2. The Growth and Evolution of Alternative Investments

• Goldman’s Scale in Alternatives:
  Over 500 billion dollars managed in private assets, a business spanning 30+ years.

  “Over $500 billion… We are one of the largest managers of alternative assets. People don’t know.” (05:51)

• Expansion of Alternative Asset Classes:
  The “alts” universe now includes:

  • Hedge funds (less of a focus today)
  • Private equity: from buyout, growth, venture capital
  • Private credit: direct lending, hybrid capital, distressed strategies
  • Real assets: real estate, infrastructure

  “The asset class has become much more mature and much broader.” (06:30)

• Relative Size Compared to Public Markets:
  Despite the excitement, alternatives remain smaller than public markets but are outpacing in economic impact, especially as public company counts shrink.

  “It’s still a fraction of the size of the public markets... Yet a lot of the economy is driven by private companies.” (07:18-07:31)

3. Alternatives and Wealth Management

• Why Alts Matter for Wealthy Clients:
  Historically, alternatives were for institutions; now, individuals are turning to them to access growth otherwise missed by sticking solely to public markets.

  “If you’re only investing in public markets… there’s an imperative to learn more and start to invest in private markets.” (07:31)

• The Rise of Private Credit & Structural Innovations:
  Innovations like evergreen and open-ended structures are making alts more accessible and reducing complexity (e.g., capital calls).

  “What you’ve seen over the last few years is this incredible innovation around different structures… catering to individual investors.” (20:51)

4. Portfolio Allocation: The New Mix

• Re-examining Traditional Portfolios:
  The classic 60/40 model (stocks/bonds) is being challenged with notions of “60/20/20” or “50/30/20” — 20% allocated to alternatives.

  “I think the idea that people should have that 20% in there… we’re going to talk about a lot more across all levels of investors.” (11:51)

• Sources for The Alts Allocation:
  Where that 20% comes from depends on alts exposure (equity-like vs. credit-like strategies).

  “If you’re leaning more into equity-related strategies… more out of equities. If private credit, then out of fixed income.” (12:26)

• Allocation for UHNW Clients:
  For ultra-high-net-worth clients, the target can be 27% to alternatives — but the process to build there is complex, due to long-term capital commitments and staggered capital calls.

  “How do you get to 27% in alts? Right. It’s going to take you five, seven, ten years to get to that target…” (17:42)

5. Mechanics and Practicalities of Investing in Alts

• Capital Calls and Laddering:
  Building a private market portfolio requires years of ongoing commitments, not just single lump sums, to manage illiquidity and capital deployment.

  “You need to be very close to that client... making commitments every single year so that when we get to five to six years in, you hopefully have a self funding portfolio…” (18:51)

• Move Toward Open-Ended/Evergreen Structures:
  Newer vehicles simplify liquidity and access, though sometimes at marginally lower returns.

  “You might be giving up some performance in exchange for a whole lot more simplicity.” (21:28-21:33)

6. Manager Selection, Due Diligence, and Diversification

• Multi-Manager, Multi-Strategy Approach:
  Emphasis on diversification — across strategies (buyout, venture, private credit, real assets), managers, and “vintage year” (when commitments are made).

  “We want to be open architecture… different fund to funds… secondaries… co-investment vehicles… direct access to some of the best Alts managers.” (21:53-23:09)

• The Complexity of Due Diligence:
  Professional expertise is essential, with Goldman’s external investing group (250+ dedicated to manager diligence).

  “We have a group called our external investing group… 250 people doing manager selection and diligence… Each manager is going to take a couple months to do the diligence.” (25:36)

• Relative and Absolute Performance:
  Seeking the “illiquidity premium” — returns several hundred basis points above public benchmarks — is key to making alts worth it.

  “If I've gotten 300 basis points a year or something in that ballpark better… then maybe you would say it was worth it for that illiquidity.” (24:47)

7. Trends from the Goldman Survey of Investors

• Alts Adoption Grows with Wealth, but Millennials Are Key Drivers:
  Surprisingly strong participation even among investors with $1–5M, not just ultra-high-net-worth.

  “Down the wealth spectrum, the fact that there's a fair amount of participation all the way down to the, you know, one to $5 million clients. And I think as it becomes easier…those numbers are going to continue to go up.” (33:29)

• Millennials Lead a Behavioral Shift:
  Millennials, shaped by the financial crisis, are at the vanguard of investing in innovation via alts.

  “Their interest in accessing innovation… a lot of that is in the private markets. Right.” (34:22)

• Low Percentages Seek Professional Advice, Especially Among Less Wealthy / Younger:
  59% of surveyed wealth is professionally managed—much lower than among ultra-wealthy, suggesting opportunity for advisor education.

  “Something less than 50% of advisors have even brought up alternatives with some of the [clients].” (36:44)

• Multiple Advisors at Higher Tiers, But the Need for a Lead “Quarterback”:
  Ultra-high-net-worth households often engage two advisors but eventually designate one as the lead.

  “You know, we talked about how hard it is to build these alternatives portfolios, doing that in two places… I think you start to see this shift to one advisor really being the lead advisor… the other maybe a secondary.” (38:47)

• Generational Media Divergence in Advice:
  Millennials cite social media for financial learning, while boomers favor traditional outlets—a potentially risky trend.

  “IRS put out a list of 40 tax statements… wrong… Do not do any of these things. So that’s why I say I get a little nervous when I see millennials citing social media.” (39:52)

8. Current Themes and Opportunities in Alts

• Tech, AI, and Growth:
  The AI boom is reviving risk appetite for venture and growth equity, impacting every sector from traditional tech to healthcare and life sciences.

  “Incredible advances in AI is bringing back a lot of risk appetite to invest in venture and in growth…” (41:44)

• Secondaries, Real Assets, Infrastructure:
  Growth in secondaries (both LP- and GP-led) and real assets, especially new infrastructure like digital/data centers and energy transition.

  “Infrastructure is one we're spending a lot of time with… has inflation protection benefits… it's not your grandfather's infrastructure. Digital infrastructure, data centers, energy transition…” (43:28)

• Private Credit — The Hot Spot for Yield:
  Investor demand is strongest for private credit, combining yield, capital structure protection, and cash flow.

  “What we're hearing from clients for the last few years has been a search for yield… private credit… yields that are high single digits with quarterly cash flow.” (46:18)

9. Looking Forward: Cautions and Evolution

• Open-Ended/Perpetual ALTs Vehicles:
  Olson worries about whether managers of very large vehicles can “originate” enough high-quality opportunities as these funds grow, and how underperformance or redemptions will play out.

  “If you have more capital coming in than you can actually invest, you're going to start diluting returns… I'll be curious to see how investors react to performance divergence or negative performance on some of these.” (47:06)

Notable Quotes & Memorable Moments

• On Being a Goldman ‘Lifer’:

  “It’s all about the quality of the people and the engagement… I get to watch the evolution of alternative investments… That dynamism has also kept me engaged.” (13:18)

• On The Evolving Alts Landscape:

  “The asset class has become much more mature and much broader… we've seen tremendous inflows over the last two, three decades.” (06:30)

• On the Importance of Due Diligence:

  “Most investors need to seek the help of a professional organization… It’s a pretty intense process, each manager is going to take a couple months to do the diligence.” (25:36)

• On Millennials and Information:

  “If you go, even on your LinkedIn feed, you see videos… from major alternative investing firms… you can see why millennials are… being more inclined to alternatives.” (39:29)

• On AI and Private Markets:

  “The incredible advances in AI is bringing back a lot of risk appetite… Not just in venture, tech, and growth, but how AI is going to transform other traditional businesses.” (41:44)

• Advice to Young Professionals:

  “Be prepared, and then don’t be scared to network… Use your relationships, meet people, reach out.” (52:23)

Key Timestamps for Important Segments

| Timestamp | Segment / Topic | |------------|------------------------------------------------------| | 01:01 | Guest introduction, Olson’s background | | 05:09 | Early days of alternatives at Goldman | | 06:10 | How the alternatives space has broadened | | 10:01 | Appeal of alternatives for individual investors | | 11:08 | Alts allocation: Then vs. now (20% → 27%) | | 17:36 | The challenge of building to alts allocation targets | | 21:53 | Manager selection and diversification process | | 25:36 | Due diligence and risk assessment process | | 32:45 | Goldman survey: adoption trends, millennials | | 39:09 | Generation shift: Social vs. traditional media | | 41:40 | Themes: AI innovation, real assets, infrastructure | | 46:11 | Surge in private credit demand | | 47:06 | Cautions on fund size, origination, performance | | 48:39 | Mentors and career influences | | 50:44 | Book and podcast recommendations | | 52:02 | Advice to college grads | | 52:37 | “One thing you wish you knew” in alternatives |

Closing Resources

• Books Recommended:
  • Walter Isaacson biographies: Elon Musk, The Code Breaker (Jennifer Doudna and CRISPR)
  • How Not to Invest by Barry Ritholtz (host plug)
• Podcasts:
  • Smartless (for comedy)
  • Bloomberg podcasts (recommended by guest)

Summary Takeaway

Kristin Olson offered a highly educational look into the evolving world of alternatives — from portfolio construction realities, due diligence requirements, and how investor demographics and innovations are changing the game. With alternative assets now increasingly central to diversifying wealthy individuals’ portfolios and a focus on future trends like AI-driven innovation, private credit, and infrastructure, the conversation is a must-listen for industry professionals, wealth advisors, and investors looking beyond the traditional 60/40 allocation model.

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