The Truth Behind Private Equity’s Megaboom

Summary

The Compound and Friends – Episode Summary

Podcast: The Compound and Friends
Episode: The Truth Behind Private Equity’s Megaboom
Date: September 5, 2025
Host(s): Josh Brown, Nicole, Michael Batnick
Guest: Michael Sidgimore (Partner and Co-founder of Broadhaven Ventures, Host of “Alt Goes Mainstream”)

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Overview

This episode dives deep into the explosive growth of the private equity and private credit markets, often referred to as “alts,” and unpacks the nuanced shift of these asset classes from traditional institutional investors to the broader “Wealth Channel.” Josh Brown and Nicole interview alternative investing expert Michael Sidgimore about the scale, business models, investor concerns, and cultural dynamics driving this megaboom. The conversation balances honest skepticism with industry insights, aiming to demystify terms and trends for advisors and investors navigating this evolving landscape.

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Key Discussion Points & Insights

1. Origins, Trends, and Definitions in Private Markets

(11:32 — 20:16)

• Private markets have exploded to roughly $25 trillion in assets under management (“alts” includes private equity, private credit, hedge funds, infrastructure, real estate, etc.).

  “About 25 trillion of assets in alternatives or private markets. … Private equity is the biggest asset class.”
  – Michael Sidgimore (12:44)

• A notable shift: Institutional allocations to alts (~15-20%) have plateaued, pushing managers to target private wealth as the next major capital source.

  “Institutional investors have reached a point where they’re relatively fully out… We need a new buyer. Hey, we’re super interested in democratizing this for wealth management.”
  – Josh Brown (14:23)

• There’s healthy skepticism: Is “democratization” driven by access—or by managers needing new capital?

  “Let’s put that aside, the cynical aspect aside for a second…”
  – Michael Sidgimore (15:13)

• Private Wealth Channel: Currently massively underallocated to alts (only 1-3% vs. 15-20% in institutions), signaling room for significant growth.

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2. The Wealth Channel: Business Models & Advisor Adoption

(20:17 — 28:49)

• The cultural divide between traditional wirehouse advisors (performance-driven, experienced with alternative products) and RIA advisors (planning-focused) shapes adoption patterns.

  “Wirehouse guys… were typically selling performance. So it’s just a very different mentality.”
  – Nicole (21:23)

• Most of the alternative flows today come from a small segment:

  “There’s 10% of the advisors doing 90% of the flows.”
  – Michael Sidgimore (20:17)

• Private equity investment in RIAs changes incentives:

  “Private equity investing into wealth management is part of this.”
  – Michael Sidgimore (23:56)

• Smoother performance reporting (quarterly “marks” instead of daily) is attractive for wealth managers, but can also obscure volatility:

  “Cliff Asness calls this volatility laundering… the private equity manager gets to skate through a lot of [drawdowns]...”
  – Josh Brown (26:03)

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3. Products & Access: Evergreen, Interval, and Tender Offer Funds

(28:49 — 39:02)

• Traditional PE/credit funds have illiquid, closed-end, drawdown structures (10+ year commitment, capital called over multiple years).
  • Evergreen/Interval/Tender Offer funds have emerged as the preferred “Wealth Channel” solutions—allowing ongoing subscriptions and periodic (albeit limited) withdrawals, better fitting individual investors’ needs.

    “Evergreen funds are… continuous ability to invest… ability to withdraw capital… the firm needs to have enough deal flow…”
    – Michael Sidgimore (30:28)

• Technology platforms (e.g., iCapital) have professionalized and streamlined advisor/private investor access.

  “The market structure needed to be built… Just like the pipes and plumbing of equities, fixed income, derivatives needed to be built… Private markets is obviously much younger…”
  – Michael Sidgimore (35:33)

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4. Alts as Market Necessity: Opportunities and Growing Pains

(39:02 — 52:22)

• Private equity opens investing to a vast universe of companies otherwise inaccessible to public-market investors.

  “87% of companies in the US with $100 million in revenue or greater are private.”
  – Michael Sidgimore (39:58)

• Private credit is especially compelling due to structural changes:
  • Regulations have pushed banks out of lending to middle-market companies, giving rise to huge direct lending opportunities for private credit funds.

  “Banks were regulated out of… in stepped these Blackstones… this part of the market banks were regulated out of.”
  – Nicole (39:37)

• Explosive growth and yield stories spark concerns about excesses (“too much money chasing too few deals”), deteriorating loan covenants, and potentially riskier portfolios:

  “Is there too much money chasing too few deals where the terms are getting shittier… it’s the easiest thing in the world to sell is 12% income returns and they’re steady and there’s no volatility.”
  – Nicole (41:53) “There’s an increase in pick coverage… All those things are a cause for concern for the private credit industry.”
  – Michael Sidgimore (42:54)

• The line between private credit, private equity, and traditional lending is blurring; scale is a key competitive advantage.

  “Scale is their advantage as a firm because scale begets skill.”
  – Michael Sidgimore on Blackstone (56:02)

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5. Industry Structure: Consolidation and Brand Wars

(52:22 — 57:38)

• The “Alts” industry is fragmenting and consolidating at once:
  • Huge asset managers (Blackstone, BlackRock, Apollo, Ares, KKR, Carlyle) are swallowing up market share via capability, scale, and distribution innovation.
  • Traditional managers (T. Rowe, BlackRock, Franklin) are pushing deeper into private markets—sometimes through joint ventures (eg. T. Rowe Price & Goldman Sachs).

  “BlackRock has always had a foot in private markets… but that’s not who we are anymore…”
  – Nicole quoting Larry Fink (49:32)

• For advisors, brand and perceived stability/reputation are paramount.

  “I gotta be honest… it’s what is a big enough name that when I say it to my clients, they’re not afraid anymore, and what’s the price. The branding culture shit—nobody cares.”
  – Josh Brown (52:22)

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6. Secondaries and Illiquid Markets: The Next Frontier

(59:05 — 61:39)

• Secondaries (the marketplace for buying interests in existing private funds/companies) solve for liquidity and are seeing huge growth, especially with mega-unicorn private companies (e.g., OpenAI).
• Access for average investors remains limited; even many advisors struggle to participate except through new semi-liquid structures.

  “That part is—the market is still not built out for the everyday investor. Not even close. … And it’s a pain in the ass.”
  – Nicole (61:29) “That’s why I think this is going to be advisor led for a while, as it should be.”
  – Michael Sidgimore (61:41)

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7. The Culture of Private Equity: Stereotypes, Realities, and Brand Building

(62:12 — 71:25)

• The “douchiness” associated with private equity is partly overblown, partly true, and definitely memeable.

  “Do you know who Johnny Hillbrandt is? … All his videos are like, I’m in Nantucket now, I’m in the Hamptons now...”
  – Josh Brown (65:01) “I think there’s a lot of people in the industry who are not like that…. those focused on the Wealth Channel… are business builders.”
  – Michael Sidgimore (68:20)

• Asset managers must elevate their authentic brand while connecting at a cultural level with advisors, especially as memes and social media accelerate finance’s culture collision.

  “We’ve gone through the memeification of everything… I think they need to realize and think through how they want to work with the wealth channel that might be different…”
  – Michael Sidgimore (68:20) “Private equity and private markets don’t work unless the returns are higher than public markets. Why do it?”
  – Michael Sidgimore (69:48)

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Notable Quotes & Memorable Moments

• On the big shift:

  “The era of three basis points Vanguard, you don’t need anything else—like, I don’t think everyone has accepted that that investing era is over and we’re in a new era.”
  – Josh Brown (04:35)

• On private credit risk:

  “Is there too much money chasing too few deals where the terms are getting shittier because there is just a torrent of capital? … The easiest thing in the world to sell is 12% income returns and they’re steady and there’s no volatility. Is that the danger?”
  – Nicole (41:53)

• On democratization—or just finding new clients:

  “When I hear that stat [institutions are maxed out], I hear it cynically, I hear it like the institutions can’t physically buy any more of this stuff. We need a new buyer…”
  – Josh Brown (14:23)

• On “volatility laundering”:

  “Cliff Asness calls this volatility laundering and he flies into a rage over this… the private equity manager gets to skate through a lot of that, unless it’s a sustained drawdown.”
  – Josh Brown (26:03)

• On “scale begets skill”:

  “Scale is their advantage as a firm… That’s why I think they’ve leaned so hard into scale.”
  – Michael Sidgimore on Blackstone (56:02)

• On brand and advisor choice:

  “I gotta be honest… it’s what is a big enough name that when I say it to my clients, they’re not afraid anymore, and what’s the price. The branding culture shit—nobody cares.”
  – Josh Brown (52:22)

• On the asset class’s test:

  “Private equity and private markets don’t work unless the returns are higher than public markets. Why do it?”
  – Michael Sidgimore (69:48)

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Timestamps for Key Segments

• Intro/social banter: 00:00-07:46 (skip)
• Private markets size, institutional/wealth shift: 12:44-20:16
• Advisor adoption, wirehouse vs RIA culture: 20:17-23:56
• Private equity in RIA business, marking and volatility issues: 23:56-28:49
• Evergreen, interval, tender-offer funds & tech platforms: 28:49-39:02
• Private company/credit market structure: 39:02-52:22
• Big asset manager partnerships, consolidation, branding: 48:25-57:38
• Secondaries evolution and access: 59:05-61:39
• Private equity “culture” and memes: 62:12-71:25

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Takeaways

• Private equity and private credit are entering a new era—moving from a niche institutional playground to being integrated into wealth management, with profound impact on portfolio construction, advisor business models, and industry culture.
• The boom brings real opportunity for investors to access vast new parts of the global economy—but everyone, from investors to advisors, needs greater education and must carefully weigh risks, manager selection, and structural fit.
• Branding, authenticity, scale, and distribution are increasingly as important as the underlying investments. Advisors and clients will be both the battleground and beneficiary as this evolution plays out.

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How to Learn More:

• Michael Sidgimore’s podcast & substack: Alt Goes Mainstream
• Follow Josh Brown & Nicole for real-time takes on finance, investing, and advisor challenges.

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(Summary captures all major topics and tone, skipping ads and boilerplate. For exact speaker quotes & context, please refer to timestamps above.)

Transcript

[Josh Brown]

Where do you live?

[Michael Sidjimore]

Between D.C. and here.

[Josh Brown]

Okay.

[Michael Sidjimore]

I split my time.

[Josh Brown]

Where. Where are you more often?

[Michael Sidjimore]

Here. I'm here pretty much. Our office is three blocks up from you.

[Josh Brown]

So why are you also in dc?

[Michael Sidjimore]

That's where I built the home podcast studio when I started AGM during COVID.

[Josh Brown]

You know you can move the microphones.

[Michael Sidjimore]

I could. I could. You know, I know I could move the microphones. It is. It's a cool background though, so it's hard to.

[Josh Brown]

So I listened. I listened to your show and I really liked it. And I know it's very long running. You've done a ton of episodes.

[Nicole]

He caught one, but he caught one.

[Josh Brown]

No, you're. Dude, you're. You can do it. You're good. You're good.

[Michael Sidjimore]

Appreciate it. Yeah, it's good to hear from another podcast.

[Nicole]

I thought that this episode was just gonna be. I thought I was gonna be in this seat. Josh was not supposed to be here, so I invited you.

[Josh Brown]

Well, surprise, surprise.

[Nicole]

So I invited you and somebody who canceled 24 hours ago.

[Josh Brown]

Dead to us. Right, Nicole?

[Nicole]

And I'm not gonna name companies. I'm not gonna name names. I'm not gonna do it. No, I'm not gonna do it. But let's just say it rhymes with.

[Josh Brown]

Stop, stop, stop, stop, stop, stop.

[Michael Sidjimore]

Do it.

[Nicole]

And listen. You are not encumbered by corporate speakers.

[Josh Brown]

Yeah, but I saw the. I saw the person's title, and I don't know how they even got into our show.

[Nicole]

What do you mean?

[Josh Brown]

This person was like the vice president of human resources or something. It's like a. It's not CEO. It's not a portfolio manager.

[Nicole]

It was not.

[Josh Brown]

I would never. I would have edited this person out if they came here.

[Nicole]

It was none of those things.

[Josh Brown]

I only want to hear from Michael.

[Nicole]

But I guess, like there's. I thought the doc looked K. Like if there's too much smoke. Come on.

[Josh Brown]

Some people can't handle the truth.

[Nicole]

Some people can't handle it. All right, all right. Well, you can handle the truth.

[Michael Sidjimore]

I will say it does bring up an interesting point in this space, is that I think firms take their brand very seriously, as they should, as they agree. But at the same time, they may have to recalibrate some of that as they think about working with the Wealth Channel.

[Josh Brown]

Well, they're going to lose, cuz John Gray is not taking himself seriously and Harvey Schwartz is not taking himself seriously. I think the best, the leading avatars for the private equity market are people like David Rubenstein, who mix it up with the Crowd and have unexpected conversations and are not scripted. When they do media, they're gonna win because that's what the advisor audience responds to. So if you want to come on and read your PR talking points, you're not gonna do that here, right? I don't even know where is the venue for that. Yahoo Finance. Like, where. Where could you go where they're like, tell us what questions we can. We can ask you. I don't even know if that even exists anymore. So anyway, you ready for this?

[Michael Sidjimore]

Yeah, I'm ready. I thought we were going. I was. I was ready.

[Josh Brown]

We're going. We're going. We start recording you the minute you get off the elevator. I don't know if you know this.

[Nicole]

So you've been podding for a while. When did you start? A couple years ago.

[Michael Sidjimore]

The 20. April 21st was the first podcast.

[Josh Brown]

Okay. This show started. This show started in June 21st, so.

[Michael Sidjimore]

Oh, really?

[Josh Brown]

I think a lot of. A lot of pods were born in that era because none of us knew what to do with ourselves.

[Michael Sidjimore]

Okay, we can talk.

[Josh Brown]

Yeah. How many episodes have you done?

[Michael Sidjimore]

170.

[Josh Brown]

It's amazing. Congratulations.

[Michael Sidjimore]

Thank you.

[Josh Brown]

Congratulations. How many have we done?

[Nicole]

206.

[Josh Brown]

Not too bad.

[Michael Sidjimore]

I got. I gotta. I gotta pick up the pace here.

[Josh Brown]

Are you, as far as, you know, the predominant podcaster in the alternative asset space? I think you probably are focused on.

[Michael Sidjimore]

The intersection of private markets and private wealth. Yes. Ted. Ted has obviously done this for.

[Josh Brown]

But Ted goes way more hedge fund than you do.

[Nicole]

Ted's more institutional.

[Josh Brown]

Yeah.

[Michael Sidjimore]

Do you not consider hedge fund? So. So I haven't done as much on the hedge fund side. And then I would think of hedge funds as alternatives. I think what they haven't done as much of is work with the wealth channel in the same way that the larger alternative asset managers.

[Josh Brown]

They tried. It didn't go well. The returns were bad, but they.

[Michael Sidjimore]

We'll see if they try again.

[Josh Brown]

They had their moment 15 years ago after the financial crisis, and unfortunately, it was like the worst time to get into global macro. But that's what all the advisors were looking for. They wanted the people that called the crisis correctly. Unfortunately, those people then went on to predict 10 other crises. And the end result for wealth management clients was, when can I get out of this thing? And, you know, this history.

[Michael Sidjimore]

Well, this is, I think, important thing to talk about in the context of evergreen funds, which I'm sure we'll discuss, which is how should advisors think about investing in private markets?

[Josh Brown]

And what's evergreen funds you buying like Christmas trees. I'm kidding. No, I agree. I actually, I'm going to do a lot of questions with you.

[Michael Sidjimore]

Yeah.

[Josh Brown]

Mostly because I have not paid close enough attention to this space over the last five years as I should have. But also our audience. We have a lot of people working in wealth management and a lot of people who are the clients of people working in wealth management. And I think it hasn't really dawned on everyone that the era of three basis points vanguard. You don't need anything else. Like, I don't think everyone has accepted that that investing era is over and we're in a new era. So I think because of that, there's a lot of just. I don't wanna call it ignorance, but there's just like a lot of. I'm too afraid to ask these questions. What is an interval fund? What is this? So I'm gonna pepper you with, like, give me definitions as we discuss.

[Nicole]

Wait, where's your compute? You have an investpedia open. How are you gonna do this?

[Josh Brown]

No, no, no. But, like, when you talk to Ted. When you talk to Ted. Cites. You guys are speaking at a level that makes sense given his audience, which is institutions. My audience. They wanna learn.

[Michael Sidjimore]

Yep.

[Josh Brown]

But, like, they're not ready to. They're not ready to hear some of those terms without us pausing and saying, what does that mean?

[Michael Sidjimore]

Which is good. I mean, I think. Look, like, that's one.

[Josh Brown]

That's missionary work. It's missionary work, of course.

[Michael Sidjimore]

But I mean, all the firms are doing that. Like, what's Blackstone doing? Blackstone University. Apollo has Apollo Academy, you know, et cetera, et cetera. And they all know they need to educate the advisor. We did that at I Capital. That was a huge part of what we did. The iCapital is still doing it today. And. But that, I think, is a hugely.

[Josh Brown]

Important education is marketing. These firms pay for their universities out of the marketing budget. Nothing wrong with it. You know who I had here the other day? I had Shonali Basak here. And I think she maybe has, like, the most consequential role in this ecosystem out of anyone because she's like, basically going to be the face of ICAP and the voice of ICAP when she starts doing media.

[Nicole]

Did you know Michael is one of the first. What employees there?

[Josh Brown]

Yeah, I know.

[Michael Sidjimore]

That helped build the sales team. Number nine.

[Josh Brown]

Okay.

[Nicole]

Number nine.

[Michael Sidjimore]

Yeah.

[Josh Brown]

And so she. So she's like, I'm so excited because, you know, working at one private equity firm, basically, that's the whole story that I have to tell and that's the whole job is marketing that. But sitting at iCapital, I work with every firm and I can really put my contacts to good use by connecting people from all over the ecosystem. So I think she's like perfectly positioned for.

[Michael Sidjimore]

Oh, I mean, and that's critically important. Right? Like somebody has to connect public and private. Somebody has to make sense of what's going on in the industry, what the different firms are doing, how they're doing it, how advisors think about private markets, how to fit into a portfolio. All those things I think are top of mind, right. And they're going to have to think about and the productization around it. There's model portfolios, there's, I mean different advisors have different types of clients. All of those things.

[Josh Brown]

I hold your thought. So let's start the show. He's, he's brimming with information.

[Michael Sidjimore]

We're going.

[Nicole]

To stop the clock. Here's a word from our sponsor.

[Josh Brown]

Today's episode is brought to you by Wisdom Tree. Enhance your portfolios with expert insights from WisdomTree. WisdomTree's portfolio consultations provide a comprehensive review that includes unbiased forward looking investment ideas tailored to your needs. The experienced consultants at WisdomTree leverage insights from a global research team to offer fresh perspectives and help you achieve your clients portfolio goals. WisdomTree offers a range of services including individual fund analysis, asset allocation guidance, portfolio stress testing, risk deconstruction and more. The review includes a detailed analysis of your portfolio, helps pinpoint unforeseen risks and includes actionable insights. Connect with WisdomTree for a no cost consultation today, visit wisdomtree.com portfolioconsultations before investing, carefully consider a fund's investment objectives, risk charges and expenses contained in the Prospectus. Available at wisdomtree.com investments Read it carefully. There are risks involved with investing, including the possible loss of principal. This episode is sponsored by GPZ by Veneck. When private markets expand, who leads the charge? The asset managers behind the scenes. Those investing in private equity, credit infrastructure and real estate. Introducing GPZ, the VanEck Alternative Asset Manager ETF. For the first time, retail investors can invest alongside Blackstone, Brookfield, KKR Apollo and peers sharing in the growth of private markets with minimal effort. GPZ tracks a specialized index of ultra pure alternative asset managers capped at a low cost 40 basis point expense ratio. Want diversification? With a twist? Step beyond traditional funds. GPC gives you access to the firms making private markets move for less. Ask your advisors today or find it by ticker. GPZ. For more information and the prospectus, visit vaneck.com gpz Josh.

[Michael Sidjimore]

Welcome to the compound. And friends.

[Josh Brown]

All opinions expressed by Josh Brown, Michael.

[Michael Sidjimore]

Batnick and their castmates are solely their own opinions and do not reflect the opinion of Ritholtz Wealth Management.

[Josh Brown]

This podcast is for informational purposes only and should not be relied upon for any investment decisions.

[Michael Sidjimore]

Clients of Ritholtz Wealth Management may maintain.

[Josh Brown]

Positions in the securities discussed in this podcast. Oh my God. Episode 207. Ladies and gentlemen, you are now listening to one of the best investing podcasts in the world. We have a very special guest here today. He is a podcaster, thought leader, operator, expert in an area of the market that is in one of the biggest bull markets any of us have ever seen. Super excited to learn from him today. Maybe push back a little bit. We'll see what happens. Either way, we're going to have some fun. Michael Sidjimore is a partner and co founder of Broadhaven Ventures, a global early stage investor that makes principal capital investments in financial technology companies and venture capital funds. Michael is also the founder of Alts. Alt goes mainstream. No S or S. All right.

[Nicole]

Don't always trust me. Up to you. Change it. It's not too late.

[Michael Sidjimore]

You know, I've thought about. I've built out the brand.

[Nicole]

Nah, just do it.

[Josh Brown]

If you added an S, nobody would care. The brand is you. As you know, it's not like somebody else could sit in the seat and do all goes Mainstream. You're the brand boy, Micah.

[Nicole]

You guys are also an investment bank?

[Michael Sidjimore]

Yes, we have an investment bank called Broadhaven. About 65%.

[Josh Brown]

You said that you listen to my.

[Nicole]

Wasn't listening. I was distracted. No, you didn't. You didn't say that.

[Michael Sidjimore]

You didn't say that.

[Josh Brown]

Literally said it. Co founder of Broadhaven Play. Do I have to play the tape or can we.

[Nicole]

That makes principal capital. You didn't say they're an investment bank. I said you didn't say it.

[Josh Brown]

What do you mean? What is Broadhaven Ventures?

[Michael Sidjimore]

We're the principal investment arm that sits on top of the investment bank that my.

[Josh Brown]

So I said I said it wrong. What you guys do now?

[Michael Sidjimore]

What I. Not what I do.

[Josh Brown]

He knows what he said.

[Nicole]

It was incomplete.

[Josh Brown]

All right, all right. Just kidding. Michael, it's so great to have you here and I've been overdosing on listening to you over the last couple of days and I'm so excited to have this conversation. Let's start with this. How big is the alternative investing market right now? Give us some sense of the. The scale as we sit here today.

[Michael Sidjimore]

Yeah. So I'll go from a chart from Brookfield, which is probably based on some other data like the Bain and companies, the prequins, etcetera, of the world, about 25 trillion of assets in alternatives or private markets. Day. Now, private markets is not just private equity, which is what we may think of. It's also private credit and hedge funds and infrastructure, real estate, private GP stake. So it's about 25 or so trillion today. Private equity is the biggest asset class within private markets. Now, over time, let's see what happens with things like secondaries. I think if there's going to be a $50 billion fund that's raised, secondaries is probably the first place that that would happen.

[Josh Brown]

Secondaries is private equity funds that have holdings they'd like to get liquidity on. A secondary fund would come along. It's just another private equity fund. But they specialize in buying those assets away from the primary. Correct. Why is that so vital and necessary right now? The second. Is it because there's a lack of liquidity?

[Michael Sidjimore]

To some extent, yes. So there's. In today's world of private markets, yes, absolutely. There's been a lack of liquidity, lack of distributions, mainly because the institutions. And we'll talk about this as it relates to the Wealth Channel, I think that's all part of the story here. Is that part of why the alternative asset managers, the Blackstones, Apollo's, kkrs, et cetera, of the world are choosing to work with the Wealth Channel is because institutional investors have reached a point where they're relatively fully out 15, 20% invested in alternatives. I mean, the Yale Harvard endowments are some.

[Josh Brown]

When I hear that stat, when I hear that statistics, I hear it cynically, I hear it like the institutions can't physically buy any more of this stuff. We need a new buyer. Hey, we're super interested in democratizing this for wealth management. I don't mean to be cynical.

[Nicole]

How could it not be?

[Josh Brown]

But how could you not be when that's the rhetoric.

[Michael Sidjimore]

Very fair question of private markets. I think there's certainly some truth to that. When you think about alternative asset managers as businesses, their customers are their LPs. So institutional LPs are their customers. Now. The Wealth Channel is another customer of theirs. And particularly as some of these firms are in public markets or have taken investments from GP stakes, firms like so they've taken in capital to grow their business.

[Nicole]

We don't say that name here.

[Michael Sidjimore]

Dead to us. Grow their business.

[Josh Brown]

Dead to us.

[Michael Sidjimore]

They, you know, they need to think about other Pools of capital. It's not just private wealth, it's insurance to. Insurance has been structurally under allocated to private markets and I include like things like private credit in that relative to institutions. But I think let's put that aside, the cynical aspect aside for a second because I think there's another side of this.

[Nicole]

Can we start with the cynical side? Just, just lean into a little bit.

[Josh Brown]

Let's get it, let's get it out of the way.

[Nicole]

Out of the way for sure.

[Michael Sidjimore]

So look, I think.

[Nicole]

These, these are very, these asset managers are, are the best in the world. They're very good at generating revenue and profit for their shareholders and themselves. They charge higher fees and now they're all buying insurance companies because like it's just, it's a never ending supply of money and investments and fee related earnings and profits and carrying all that good stuff.

[Michael Sidjimore]

Sure. So I think you hit on an important aspect from the business of asset management, which is they charge a management fee and they charge carry. As you guys well know from the evolution of the mutual fund industry, the rise of ETFs, the traditional asset managers who also are getting into private markets in a big way, whether it's Franklin or T. Rowe, Blackrock, et cetera, they've seen a fee compression in traditional asset management. That's the way the mutual fund industry went. And alternative asset managers generate higher fees. So I think if the institution.

[Josh Brown]

Wait, I'm hearing that cynically too though.

[Michael Sidjimore]

Sure. So the next piece of the puzzle here is the institutional side. As they've become bigger consumers of private markets, there was a wave in alternative asset management where big institutions think like the Maple 8. So the big Canadian pension plans, Ontario teachers, the CDPQs of the world, et cetera, they started going to private equity firms and saying, hey, we want to co invest alongside of you or we want to build out a direct investment capability. Why do they want to do that? In part because they wanted access to this part of the market, but in part because they wanted to blend down their fees.

[Josh Brown]

Yeah, strip out the fund. We don't need a fund. We're coming with money. You have the products, let's do it that way. Smart.

[Michael Sidjimore]

There's definitely a piece of that where I think we've moved away from 2 and 20 is the common parlance, right. 2% management fee, 20% carry. That's more likely the case to be in private equity than it is in private credit. And there's a reason for that. There's some element of like you have to hire the team, they have to find the companies, they have to do the diligence. We could debate whether it should be 2 in 20. I don't think it is 2 in 20 anymore. I'll use another example of certain fees have gone down. So like EQT is one example. They're a big 270 billion euro private equity or alternative asset manager. Their fees have stayed relatively constant about, if you look at one of their last management presentations, about 142 basis points or so. That stayed relatively Constant. It's not 2% anymore. And that gets to your point of. The fees have come down in private markets. Will they come down to true vanguardization of private markets? Probably not.

[Josh Brown]

I actually think they should. They should be high. It's a very complex thing to manage a portfolio of privately held investments. They should not look like an etf. So we agree there. I guess what I'm trying to figure out is. And maybe there is no good answer, maybe this is just the way it is. I heard you talk about. You estimate there's $250 billion in private equity. That's just wealth management channel money. And I think you're including the Merrill lynch and the Morgans who have always done private equity investing and now the mega RIAs, OSAIC, creative planning, et cetera. Is that the number? Is it a quarter of a trillion dollars in wealth money?

[Michael Sidjimore]

I think that was specifically related to the Evergreen Fund.

[Josh Brown]

Oh yeah.

[Michael Sidjimore]

So it's more than that.

[Nicole]

Yeah. And just Blackstone.

[Josh Brown]

It's just Blackstone.

[Michael Sidjimore]

Yeah, Blackstone. So Blackstone, is that 250, roughly speaking, it's probably a little higher today than when I. So where do you set its name?

[Josh Brown]

Where do you think it's headed? Like, but let's say end of decade, like what do you think that number's gonna look like in dollars?

[Michael Sidjimore]

We're certainly talking trillions of dollars from the wealth channel. So here I'll break down the.

[Josh Brown]

I think you're gonna be right.

[Michael Sidjimore]

So about 140 trillion of assets on the institutional side. There's a roughly similar number on the global private wealth side. Individual investor side, about 145 trillion or so. This is data from Bain, Bain and Companies Private equity. They put private equity report out every year. Private wealth is around, roughly speaking, around like 1 to 3% allocated to private markets.

[Josh Brown]

So rounds to zero, basically.

[Michael Sidjimore]

Institutions are 15 to 20.

[Josh Brown]

Yeah.

[Michael Sidjimore]

So maybe it shouldn't be 15 to 20 in the next five years. And that depends on the client. Family offices have invested in private markets in many cases for years.

[Josh Brown]

Yeah.

[Michael Sidjimore]

If they're qualified purchasers or qualified institutional buyers. They're probably having some allocation to either private equity funds or companies directly or other parts of private markets. But when we think about how early it is, the to your point, like the Osaics, the LPLs, the Schwab's, the fidelities, they're just starting to get into this now. Some platforms, the Hightowers, the Focuses, the Dynasties, these RIA aggregator roll up platforms and then private equity backed firms they're getting into and some have advisor teams that are doing it. But even still there's still relative under penetration. I would say it's this is again rough numbers but I think it's the 8020 rule, maybe even the 9010 rule of at many of these firms, even the big wirehouses, there's 10% of the advisors are doing 90% of the flows today. So I think it is going to be.

[Josh Brown]

Let's try to pin in that because that's an important stat for us. Michael, do you agree with the statement the more former wirehouse advisors work at an ria, the higher the likelihood that that RIA is actively allocating to alts.

[Nicole]

100% because wirehouse guys, they learn that when they're selling performance and RAs were typically selling planning. So it's just a very different mentality.

[Josh Brown]

So when you say like Hightower, Dynasty, everyone that works there used to work at Morgan Stanley.

[Michael Sidjimore]

Yep.

[Josh Brown]

And Merrill lynch. And they spent 25 years, let's say got a guy in his late 40s, early 50s, spent 25 years telling their clients the reason to have an account with them was performance. So and they used alternatives as part of their pitch. They don't really believe in financial planning. Now they have some young CFPs, they throw the kid at a client and they're like, hey, do a financial plan for this guy. You do it and then they get to check a box and get higher compensation. There's not like a hardcore wave of CFP believers at the wires. Nothing wrong with that, just pointing out what it is. The clients actually care more about performance than meeting with the CFP kid. So it's a nice fit. Those are the people who when they break away, they go to Dynasty or Hightower. Those are the people most likely to take meetings with Blue Owl and Carlyle and all these firms and want to know like which of your products can I include in my portfolios? Because I'm going to be pitching the performance of these products.

[Michael Sidjimore]

I think it's a really important point in two contexts.

[Josh Brown]

One is you have but I Think that's what's changing.

[Michael Sidjimore]

Yeah, so. So these things are all in the world.

[Josh Brown]

Look at this.

[Nicole]

That is ominous.

[Josh Brown]

Nicole. Wow. All right, never mind. I'm sorry. A raven just perched on your shoulder. It's not an omen or anything. I wouldn't worry about it. I wouldn't think too much for private.

[Michael Sidjimore]

Markets or public markets.

[Nicole]

Yeah, no, this will be fine. Jeez Louise. Unbelievable. That was a black raven. I don't even know what you're saying. But one other, one other aspect of this that's important.

[Michael Sidjimore]

Let them.

[Josh Brown]

Let him cook. Let them cook.

[Nicole]

What were we talking about? The bird.

[Michael Sidjimore]

So one. Definitely not fly. Eagles fly. We can all agree on that.

[Nicole]

Commander's fan.

[Michael Sidjimore]

Yeah. Well, we'll see what happens here. Sports is a piece of that. We can. We can talk about sports. I think that's another interesting element of all of this too. And it relates to the branding and the collision of culture and finance, which you guys have done a great job of covering in a number of ways and bringing to life. But that I think is actually part of the story here. But before that, on the point about the advisors thinking about this from a business building perspective, I don't think we can ignore the trend of private equity investing into wealth management as part of this.

[Josh Brown]

Say more. Say more.

[Nicole]

So you just interviewed Carl about this Henberg.

[Michael Sidjimore]

Yep. Carl is one example of that. He has a fund called Constellation Wealth Capital. He raised billion dollars or so in his first fund to take minority stakes in RIAs. So the likes of Crescent and Lido, Alphacore, which is alts focused ria. And I think that that's a good example of this. One of many. I mean, many private equity firms have invested into either platforms like the Hightowers, dynasties focuses of the world, or in creative planning, General Atlantic Investor and Creative tpg more recently as well, Bain and Mariner.

[Nicole]

I'm not Mariner. Carson.

[Michael Sidjimore]

Yep, yep.

[Josh Brown]

Right. So the private equity funds come in, they buy a stake in the ria. All of a sudden the CIO at the ria, the chief investment officer, is way more receptive to private equity.

[Michael Sidjimore]

Well, they need. They need to grow the business. And I will say this, so there's two sides of the coin. One aspect of it, and again, I think the most important aspect is their fiduciaries. At the end of the day, they have to remember that the other side of it is from the business building perspective, is when you think about what private markets can do to a portfolio, we can get into certain aspects of this, but private equity or private Credit, it's not daily mark to mark in many cases now certain structures are creating more frequent marks. So get Evergreen funds. But the traditional closed end drawdown structure private equity fund, they mark once a quarter and that valuation is not daily mark to mark like public equity portfolio. In periods of volatility in public markets that can be a challenge for a wealth manager's business. Private equity, private credit, because of their marking cycle, they may not have that same volatility in a certain period. I think there's data that shows that private equity can outperform over certain longer periods of time and market cycles relative to public equities in certain cases. Again that depends on the private credit.

[Josh Brown]

Has demolished public fixed income demolished. I mean it's not even a horse race anymore. So that's a good point. What do you say to the people who would listen to that talking point about the lack of day to day volatility because there are no marks for 90 days? I'm sure you've heard the criticisms of that. I'm sure you've heard great defenses of that criticism from the industry. So Cliff Asness calls this volatility laundering and he flies into a rage over this and I think he's rightly bitter, I get it. Because he has. So he has a portfolio of public stocks and bonds, he has to answer to clients why am I in a 15% drawdown over the last month? Whereas the private equity manager kind of gets to skate through a lot of that unless it's a sustained drawdown and then the marks will come down usually on a delay. So how does the industry respond to that? I don't want to call it a charge, but that criticism, don't tell me lower volume, it's not a charge.

[Nicole]

That's the point.

[Michael Sidjimore]

I think there's.

[Josh Brown]

Right. It's one of the benefits of the asset that's like the selling point.

[Michael Sidjimore]

So I think there's definitely on both sides. There's some where you sit is where you stand element to it. So we all have our biologically people will have their biases. People who are in private markets will have their biases and people who are in public markets or in hedge funds will have their biases when it comes to how they're thinking about that. I think there's valid points on both sides. I think it really comes down to what does a client need and what do they want and what's appropriate for their portfolio. I think whether you're a traditional asset manager, whether you're an alternative asset manager, the most important thing is you have the right product structure at the right time, that's delivered to the right investor and that could be for a certain client. Maybe that's a closed end drawdown fund for a QP client who has 100 million in net worth and they want to invest in private equity, they can take that illiquidity risk. And as long as, and maybe they have, they're working with an advisor or a team that can build out that private equity program and that understands that they're going to have a J curve in the first few years. So they're going to be paying out money effectively for capital calls. They're not going to be seeing money come back. So the IRRs might not look great relative to equity if you put it into public equities today or maybe not four or five months ago, but eight months ago or something like that. And then you have to think about it over longer term. But then by year eight or nine, you'll have the harvest period and you'll be getting capital back. And in an ideal world, in a private equity fund, you're getting more capital back than you put in. So over a 10 year period, if you smooth out the IRRs, then that would have bested what you could have done over that same period. In public finance you have to wait.

[Josh Brown]

A really long time to be able to determine this 10% allocation we put into private markets was a good alternative or a bad alternative. Like you really have to wait for that harvest period when you start pulling your money back out. And you look, this is why it's predominantly an institutional market because most normal people, it's hard for them to wrap their heads around investing with a 10 year. I mean we do it all the time with 401s, but it's just, it's still hard.

[Michael Sidjimore]

Yeah, I mean, great point in two contexts. One is maybe 401ks again with the right managers, with the right structures for investment. And there's the regulatory and legal side that needs to be figured out that I think is still in question despite the executive order. Maybe that's the right vehicle for that because it's capital, it's money's locked up anyway. You're not going to, I agree with.

[Josh Brown]

That part of it.

[Michael Sidjimore]

Take the money out and you don't need it. And you don't need it in a year from now, you don't need it in three years from now. So I think that's an important piece of this is you need to match the right vehicle or the right duration with what you're trying to achieve as an investor. I think the other piece of this too is like there is an element of private markets and building a private markets or private equity program that is very institutional in quality and in nature. And you need to have the ability to do that in order to invest in more traditional private Equity. So the 10 year drawdown, closed end vehicle. We're starting to see that change in this industry with the creation of evergreen funds where I do not call them liquid. They are very much not liquid.

[Josh Brown]

They are tell our listeners what an evergreen fund is.

[Michael Sidjimore]

So evergreen funds are. They're not closed end drawdown vehicles. Closed end drawdown vehicles means you commit capital and it's generally over a three to five year period that it's called the fund closes. Fund closes. You can't get your money out. You can't call up and say, hey, I want to redeem.

[Josh Brown]

You also don't put new money in. Right.

[Michael Sidjimore]

You commit a million dollars, that capital gets called 30% in year one, 30% in year two, 40% in year three. Just making up numbers, but based on the cadence of the investment managers, processing of deals, sourcing companies and deciding to invest. An evergreen fund is different in that there's continuous ability to invest. There's also the ability to withdraw capital. There's nuances based on the type of evergrean funds. Yes, they limit the amount that an investor or investors can redeem at any given time because they need to manage the liquidity. But they're constantly looking at different investment opportunities. And I think this is the important piece of evergreen structures is that the firm needs to have enough deal flow to be able to handle both the amount of capital they raise because they can raise in continuous offering format. It's not like most private equity funds in the historical context would say, I'm going out, I'm raising a $25 billion fund. That was less common. A few firms do maybe million dollar funds. Exactly. But like a CVC, they raised 26 billion euros in their last fund. So like we're gonna go raise $26 billion or 26 billion euros. They do that fundraise for six to 18 months. Once that fund is closed, it's closed to your point, you can't get in if you miss that close. I think that's an important point though for the advisor community and why evergreens.

[Josh Brown]

Can make sense for certain, using evergreen and interval synonymously.

[Michael Sidjimore]

Evergreen funds I look at, I think of as the broad umbrella term for interval funds, tender offer funds. Those are different types of structures.

[Josh Brown]

What's a tender offer fund.

[Michael Sidjimore]

Tender offer fund and interval funds are both. They can be closed end or open ended. But tender offers mean that there's a period where investors can actually tender some of their capital for redemption versus interval fund. Their specific intervals? Yes, generally quarterly. Although in a tender there's a board.

[Nicole]

How 10 are we talking? Medium rare?

[Michael Sidjimore]

Depends. Some people like their world.

[Josh Brown]

Okay, so just on the surface, the interval fund, the Evergreen fund, makes way more sense for wealth management than the traditional closed fund because we're not institutions. We're human beings. Things happen in our lives and maybe we don't. We can't demand the right to get 100% of our capital out. But if you tell me, God forbid you go into a stretch in life where you need to reinvest in your own business or something horrible happens to a family member, it's not 0% liquidity and vice versa. Regular people don't typically make their money via windfall. They make money over time, over years. So having a vehicle that they can add a dollar amount into every year makes it more utilitarian for that person. So I totally get why that structure has become so popular. What percentage of the assets that the Wealth Channel is putting into alts would you say is going into interval funds right now?

[Nicole]

Most of it.

[Michael Sidjimore]

I don't exact number. It's like almost all depends on how you define the Wealth Channel. Again, like if you think about family offices, then I think.

[Nicole]

Mostly interval funds.

[Josh Brown]

RIAs and Wirehouse is mostly so and.

[Michael Sidjimore]

This is public, public data. But I Capital had talked about this that because they have over 240 or so billion, maybe I'm off by. By a few billion at this point of assets on their platform. They do both closed end funds, but they do a lot of evergreen funds on the private market side. A good portion of their flows have been evergreen funds. They're working with the Wealth Channel and it's all advisor led. It's wirehouses and it's RIA channel or independent channel. The majority of the flows are through Evergreen structures.

[Josh Brown]

You refer to the I Capitals as placement agents. Is that or is that not the right?

[Michael Sidjimore]

I think it's more of the pipes and plumbing of.

[Josh Brown]

So they call, I know they call themselves a platform. Everybody wants to be a platform now they are but they're all. But they're also directing advisors toward one fund, not another.

[Michael Sidjimore]

There's so there's different models. I Capital has multiple models. And for context, I was, I was an early employee at I Capital. I helped build the investor network or distribution team.

[Josh Brown]

Crushed it with that. Crushed it with that. Just saying, look at it. I mean look at it now. You gotta be very proud of that.

[Michael Sidjimore]

Yeah, I mean look, I think the market structure needed to be built just like the pipes and plumbing of equities. Fixed income derivatives needed to be built and has evolved over time and has become more electronified over time. Private markets is obviously much younger. I mean Blackstone is a 40 year old company. They're the biggest a trillion plus of assets. It's still a young industry when you think about the size and scale. And if it's, if it is 25 trillion of total assets in private markets, I mean equities is what 110 trillion. Fixed income is similar number.

[Josh Brown]

The reason I love what you did is that I existed in this industry prior and there were a lot of advisors who wanted to sell private investments to their clients. It was a wild west. There was no platform where you could look and say compare this fund to three of its nearest peers and let me rank it on different. Did not exist. There was no way to automate the paperwork process or explain what the paperwork means that your client's about to sign. Did not exist. You had guys running around with PPMs, private placement memorandums, doing reg D offers, like just ridiculous conversations, extra legal in many cases and what you have done and I know there are others, but like those platforms that now exist, I think they have brought order to a very chaotic process.

[Michael Sidjimore]

I think the, even if you don't.

[Josh Brown]

Like the investments, you gotta, you gotta agree that they are good for investors. The fact that this exists, I think.

[Michael Sidjimore]

That'S a big piece of the puzzle to making sure that the wealth channel is served properly. Because if you think about it, yes, the investment is important. So I don't want to minimize that. And selecting the right fund is absolutely critical. It's probably even more critical in private markets than it is in public markets. But putting that aside for a second, just the operational challenges of investing in a private fund, whether it's a drawdown, closed end fund or even an evergreen fund, unless you create the straight through processing system leveraging technology, it's much harder to do. And that's why it's been so important. And I don't think the private wealth investing in private market story can actually take place without the technology market structure, evolution, those two things can't be decoupled. You need that evolution from pre to post trade in private markets. Just like you had in equities, fixed income and derivatives. And that's the other Piece of this is you have to create the right packaging and the right post trade processes because you the example you gave earlier about the client needing to make sure that it's easy for them. I think the part of the reason why an evergreen structure is important for the Wealth Channel is it's also helps the advisor run their business. They don't want to have to wait to the next drawdown fund to be able to put a new client who comes in. You deal with this all the time. You have new clients who come in.

[Josh Brown]

Yeah, sorry. Well, I will allocate you in five years, right?

[Michael Sidjimore]

Yeah, you can't do that. You want to have an evergreen offer that you can say, hey, I just had a new client came in. I can allocate to this manager because this is part of our private equity program. We've vetted this fund or our private credit program. We like this manager. We have an account with them already. We've worked with them across our client base and that can be get in today accredited and qualified purchaser. And you can put a $10,000 minimum or $100,000 minimum in for one client and then you could put a $5 million investment in for another client. And it makes it easy for the advisor. And I think that's a big piece of this too is you have to meet the advisor where they are one.

[Nicole]

Of the other big parts of the story, the less cynical part of it because we address that part. Institutions are full. The Wealth Channel's next. Okay, is that the actual investment story here is that 83% of the companies in the United States that are doing $100 million in revenue are privately held. I'm sure a lot of them are private equity backed. The other side of it is the private credit side. And private credit's just. It's bonds for these private companies. It's loans.

[Josh Brown]

The untraded junk bonds they prefer.

[Nicole]

No, no, no.

[Josh Brown]

Sorry jk.

[Nicole]

This part of the market banks were regulated out of. And so in stepped these blackstones of the world and said we could do it quicker, we don't have to syndicate it. We have an endless supply of money. We can do the underwriting better, can negotiate if things go wrong. And it's all playing out. And that is a huge part of how we got to where we are today.

[Michael Sidjimore]

Oh, 100%. I mean so you mentioned the. Let's talk about the private company side. 87% of companies in the US with a hundred million in revenue or greater are private. Similar numbers in Europe and Asia. So I think it's a really important point. It's an important point to me.

[Josh Brown]

Right, which is it's the whole universe of investable assets and almost none of them are traded.

[Michael Sidjimore]

And if you don't have access to that, you're missing out on all of that. In a world where what Nvidia is 7, 8% of the S&P 500 and you have indexation of correlation, you have concentration and the rise of passive. All of those things. I think if you're shut out of investing in the private markets and again I want to put the disclaimer on because it's important that you need to make sure you're investing in the right companies or the right funds.

[Nicole]

How is that all?

[Michael Sidjimore]

So, so, so that's the important piece. You can't just buy the just fire.

[Josh Brown]

Up the spaghetti cannon and just start throwing. Okay, but part of, part of that. Are you writing this stuff down for me, Duncan?

[Nicole]

Michael. Part of that is this. So I totally understand private credit. It is wherever it's going. 25 trillion, it's going to 40. Whatever. I, I believe it. I 100% believe it. The problem is as I see it, I get legitimately a dozen emails like this a week and I picked the most recent one. I partnered with RA family offices and institutional investors seeking differentiated private market opportunities. As a blank billion dollar private credit manager. We originate loans in niche markets. Our portfolio is 100% senior secured producing 12% annual cash distributions and a 17% IR with a $2 billion track record and bubble zero credit loss. Okay, is there too much money chasing too few deals where the terms are getting shittier because there is just a torrent of capital because the advisors the easiest thing in the world to sell is 12% income returns and they're steady and there's no volatility. It's the easiest thing in the world. Is that the danger?

[Josh Brown]

You said there's 11,000 private equity and private credit managers. That's does not sound like too many.

[Nicole]

There's too many.

[Michael Sidjimore]

It's a lot. And I think that that number is going to shrink because there's going to be consolidation in the market because the biggest players are going to buy.

[Josh Brown]

But to hit but to his point. So it is crowded today and everyone's getting increasingly desperate to raise money. Not the big firms, but everyone else. And the terms are getting worse. And like what do you make of that level of activity just generating bad outcomes.

[Michael Sidjimore]

I'll talk about both sides. Cause I think there's credence to both sides. And I think Michael look at that chart.

[Nicole]

Sorry to cut off, but we'll look at a percentage of Covenant Light term loans. It's basically 100%.

[Michael Sidjimore]

Yeah.

[Josh Brown]

Is this Covenant Light meaning the protections for the end investors are lesser because the desperation. Sure, there's money.

[Nicole]

Is this misleading what's going on here?

[Michael Sidjimore]

No, that's. Look, I think you will answer for it now that that's the case. There's an increase in pick coverage. Right.

[Josh Brown]

Payment. Payment in line where. Where the company can't come up with the cash. So they'll just issue more bonds or more shares in lieu of the. That's never a good sign.

[Michael Sidjimore]

All of those things are true. And that is a cause for concern for the private credit industry. I think it's worth zooming out for a second on this, which is private credit is a $2 trillion or so industry today. It was a few hundred billion a few years ago. So it's grown massively. Anytime an industry grows fast, I think you have to take stock and step back and say, okay, is this growing too fast? Is there too much capital being raised and then deployed, all of that. That is true. I think what I would also say is if you believe what some in the industry are saying. So like Mark Rowan from Apollo, one of the biggest credit managers, you know, close to 700 billion of AUM. A large portion of that is in credit. And he would say that it's a $40 trillion marketplace over time. And that's because banks have been retrenching, there's been regulatory. 40 trillion?

[Josh Brown]

Yeah, 2 trillion to 40. No wonder there's 11,000 firms chasing it.

[Nicole]

Yeah, I bet it gets there.

[Michael Sidjimore]

So 11,000. Just to. Just to be clear, that's. Dave Layton said that from Partners Group, they're a big manager. That's private equity managers that could be private equity managers who also have a private credit.

[Josh Brown]

I think the lines are blowing very rapidly. I think they're all doing it 100%. Yeah.

[Michael Sidjimore]

There are a lot of managers chasing private credit and the opportunities there. And private credit and private equity are related too. Right. Because a lot of the private credit activity to date has been in into sponsor backed deals. So private equity, you need the leverage to do the private equity deals, et cetera. That's changing a little bit. They're doing private credit across different categories within the space. So things like asset based finance, so like aircraft leasing as an example, that's a different part of private credit. There's real estate credit, there's infrastructure credit, which is starting to grow as the infrastructure asset class grows. So I think private credit actually might be a lot bigger when you think about. It's anything that, not anything, but a lot of things that could otherwise have been on a bank balance sheet. Again, we could take both sides of this argument and I think there's probably worthy arguments on both sides. But those in private credit would argue that it actually is, it may be a concern for those who are investing in private credit. If the space grows too fast and people start to compete for deals by loosening up terms, that might be bad for the investors. But there's also a set of people in the private credit industry who would say that it's actually good if you're taking that off a bank balance sheet because there's less leverage in private credit than there is in, in the bank system.

[Nicole]

What does leverage look like in private credit?

[Michael Sidjimore]

A few turns at most. So what does that mean? Two to two to three times maybe. And it's usually, I mean some managers are doing less than a turn of leverage or 1 times leverage, but banks are generally leveraged what, 8 to 10 times or so. So again, I'm not, I'm not, I'm not here to defend private credit. I am not the foremost expert on private credit, to be clear. But I think when you listen to what the likes of Mark Rowan from Apollo is saying, that this being a very big market, that could be things.

[Josh Brown]

That banks better hope so because the banks are not going to stay out of this any longer. I listen to what JP Morgan had to say on the subject. Jamie Dimon spent like eight to ten years subtweeting this industry.

[Nicole]

Yeah, you think Clefasis is mad, right?

[Josh Brown]

So, so the bankers they looked at.

[Michael Sidjimore]

Buying Monroe capital, it's a $20 billion.

[Josh Brown]

So Jamie is like, yeah, we know about these fly by night lenders. They're not going to be here in the next crisis. Well, two things we haven't had a crisis is one, and then two, we, we are now going through this massive deregulation wave and I guarantee you by the time Trump's term ends, all of the banks, the big ones, are gonna have their own products competing with Ares, Apollo, etc. They're not just gonna watch this shit anymore. If you tell me private credit is 2 trillion going to 40, do we honestly think like Goldman Morgan, JP Morgan, they're gonna just sit here and watch it and, or they're going to take, they're going to take a slice of fees for introducing a fund to their clients? No way.

[Nicole]

What happened with Goldman and Tiro today? What was in his there.

[Josh Brown]

So I have this. Can I read this? Yeah. I would love to get your reaction to it. And whether or not you think we're going to see more. T. Rowe Price had a really big upside day today. Bear with me. T. Rowe Price shares rallied Thursday after the asset manager struck $1 billion deal with Goldman Sachs to sell private market products to retail investors. Goldman will buy up to $1 billion in T. Rowe Price common stock through open market purchases. Bullish. The two financial firms will team up to offer wealth and retirement funds that give access to private markets for individuals, financial advisors, plan sponsors and plan participants. And then David Solomon did like a PR quote but basically like T. Rowe has the infrastructure to sell funds in in 401ks to advisors through banks. Goldman has the private equity assets to put into those funds by virtue of all of their whole ecosystem. T. Rowe doesn't have what Goldman has. Goldman doesn't have a T. Row house. It's brilliant. I totally get it. We're probably going to see a lot more of these tie ups. Okay.

[Michael Sidjimore]

100%.

[Josh Brown]

Yeah.

[Michael Sidjimore]

We've seen it in the reverse with BlackRock trying to build out its private markets capabilities by acquiring hps.

[Josh Brown]

And how about Vanguard partnering Blackstone?

[Michael Sidjimore]

Blackstone and Wellington.

[Josh Brown]

And Wellington. Okay.

[Michael Sidjimore]

The three party partnership. So I think that we're going down.

[Josh Brown]

Though if this continues because like these are mass market players that they can afford to undercut, charge less. I don't know. It seems like a double edged sword for the industry.

[Michael Sidjimore]

Depends on the product construction. But yes, absolutely. I think, I think we're going to see more of this. I think this is the type of thing where firms will try to match their capabilities. Goldman to your point, they have the private markets capabilities. They have 550 billion or so of AUM in private markets that they're not a pure play alternatives manager but if they were, they'd be a top five in terms of aum. So like that's, that's meaningful. They get to distribute their products through the T. Rowe wealth channel. T. Rowe and it could be Franklin, it could be Black. Blackrock.

[Nicole]

It will be blackrock. Blackrock is going to have model portfolios for advisors very soon. And Larry Fink's annual letter on like page five, he just went all in. He said blackrock has always had a foot in private markets but we've been first and foremost a traditional asset manager. That's who we were at the start of 2024 but it's not who we are anymore. In the past 14 months we've announced the acquisition of two of the top firms in the fastest growing areas of private markets. That's Global Infrastructure Partnership, HPS and hps. We bought another firm to get better data and analytics. That's Prequen. So we can better measure risks, spot opportunities and unlock access to private markets. We've transformed our company that is the biggest asset manager in the world. Going all the way in on private markets. It feels late. We're just getting started.

[Michael Sidjimore]

We are just getting started, right? Because think of how much capital can go in to private markets from the Wealth Channel. A lot of the advisors who BlackRock or T. Rowe or Franklin and then all these alternatives managers are working with and certainly on the traditional side are selling traditional products. Mutual funds, ETFs, et cetera. They're very underpenetrated in alts, whether they're wirehouses or, or RIAs. So I think we're gonna see more of this just because you have to be able to spend a lot to do distribution. Well, Blackstone has 600 people or so and a huge team and budget and they've spent a lot of resources to build out their footprint in private markets because it is a ground game to sell. Now what do traditional asset managers have? They have distribution.

[Josh Brown]

How do advisors figure out which of these firms to talk to and who's best at what product type? Is it just like you learn from. Just like weeding or Michael.

[Nicole]

Part two of that question is when hedge funds came along, not when they came along, but it was often said that assets are an enemy of performance. I feel like with private markets, private equity, especially private credit scale is really important.

[Josh Brown]

Yeah, I think it might work the other way around.

[Nicole]

So how would advisors know who to work with?

[Josh Brown]

Just call Blackstone and blackrock and call it a day. Is that all you need?

[Michael Sidjimore]

I think there will be a portion of the market that probably does that because what you're getting at is reputation. Brand wins. And so I think the nuance to your question, which is a really good one because it I think gets to the core of what all of these asset managers are thinking about in their C level stage strategy discussions, boardrooms, et cetera, is how do we show who we are? What's our DNA, what are our values, what's our culture and how does that transmit itself in terms of our investment culture and our brand and how do we market that brand to the Wealth Channel?

[Josh Brown]

I gotta be honest with you, advisors don't care about that stuff. I think it's what is a big enough name that when I say it to my clients. They're not afraid anymore. And what's the price? I. I have to be honest, I don't. That branding culture shit, like, nobody cares about that.

[Michael Sidjimore]

So that. But that's a really instructive. I'm glad you said that because that, that's really instructive and an important.

[Nicole]

Hold on, hold on. But think about it this way. Think about it this way. I think you're right to a certain extent. But to the extent that culture is the people, it matters a lot. Because how many relationship managers have we worked with that have had a very impactful part of our decision making process and who we will and won't work?

[Josh Brown]

Several.

[Nicole]

Right. So from that respect, it does matter.

[Josh Brown]

No, no, no. But how do they even get to the table to begin with? Because the company.

[Nicole]

Yeah, yeah.

[Josh Brown]

Was sufficiently large and we believed in that.

[Nicole]

But they have to have great people that are trustworthy, that can educate.

[Josh Brown]

No, I totally agree with that. What I'm saying doesn't matter. These highfalutin mission statements that have been crafted by a publicist.

[Nicole]

Yeah, nobody cares.

[Josh Brown]

Advisors don't give a shit. They don't. They're not reading the marketing materials.

[Michael Sidjimore]

That's why they. That's why I think asset managers really need to think about how they want to evolve their brand to work with the Wealth Channel. To your point earlier, Blackstone has figured that out. They have John Gray being very authentic, doing, Running videos, being on LinkedIn. Yeah.

[Josh Brown]

Wait, is he rapping? So they're all gonna start rapping. Is that what's going on?

[Michael Sidjimore]

Maybe. I mean, I think every firm needs to be.

[Josh Brown]

Can we have a little bit of fun? Can we do a little free association?

[Michael Sidjimore]

Sure.

[Josh Brown]

You were saying on another lesser podcast that every one of these companies has sort of its own brand and its own, like, idiosyncrasies. So I'm not terribly aware of the difference from one to the other. I know there are a lot of memes being made about this now, which is fun, and I follow those guys and gals. So I'm going to tell you the name of one of these firms. You don't have to do it in one way.

[Nicole]

Name an animal that you associate it with.

[Josh Brown]

No, you don't have to do it in one word, but, like, help us understand the cultures of which you speak. Okay. Apollo.

[Michael Sidjimore]

Purchase price matters.

[Josh Brown]

No. God of light. No. Say that again. What is it? Purchase price matters.

[Michael Sidjimore]

Purchase price matters.

[Josh Brown]

So they're disciplined. On what?

[Michael Sidjimore]

They're price sensitive. They're disciplined. Their DNA.

[Josh Brown]

Okay. All Right. Ares.

[Michael Sidjimore]

God of war. Okay, my, my Greek mythology wasn't great. I probably need to study up on that if I want to know all these matters.

[Josh Brown]

Why, why do they all be Greek gods? Is this like a superiority complex or.

[Nicole]

Okay, inferiority.

[Michael Sidjimore]

Aries. I think of. They, they obviously do a number of things, but when I think of Ares, I think of a fantastic credit franchise and an innovator in structure around credit and BDC world.

[Josh Brown]

Okay. Kkr.

[Michael Sidjimore]

Everybody's gonna say barbarians at the gate. I actually think, I think of them as a.

[Josh Brown]

You could say a pass.

[Michael Sidjimore]

No. When it comes to private equity and that they do other things. Obviously. I think of them as a private equity firm to start. They've done a lot of other things, but.

[Nicole]

So just do a minute on GP Stakes. We haven't spoken about that.

[Josh Brown]

Wait, wait, I got two more I gotta get to these people. Care.

[Michael Sidjimore]

Carlyle Group, Private equity. Heritage.

[Josh Brown]

So, okay, so. So like the Heritage.

[Michael Sidjimore]

Rubenstein. I mean they were, they were one of the. I mean there were obviously a few firms that were first. Kkr, Apollo, Blackstone, Carlisle's in that group. I think of them as private now. They've obviously expanded beyond that. But they're, they're also a high quality brand. I mean these are all high quality brands just in slightly different ways.

[Josh Brown]

Blackstone, the biggest. Right.

[Michael Sidjimore]

Behemoth.

[Josh Brown]

Behemoth.

[Michael Sidjimore]

And they use. Steve Schwarzman said a quote. I had this former CFO of Blackstone on my podcast a while ago. He made a really important point and a really instructive quote which was quoted Steve Schwarzman, who apparently always used to say scale begets skill. So his view is scale is their advantage as a firm because scale begets skill. If you can put enough scale against an investment opportunity that required A, that requires skill, but B, you then have an advantage. And that's why I think they've leaned so hard into scale. They've raised very large funds, but scale is what enables them to have an advantage in winning deals. I think this actually relates to private credit a little bit too.

[Josh Brown]

Is like there's like an IBM thing where there was like the old saying, like nobody ever gets fired for choosing IBM. Does Blackstone sort of have that aura about them where it's like, when in doubt, we'll just use Blackstone. I feel like they, the biweek thing.

[Nicole]

Sort of blew over and that's scale. They did a deal with Calpers.

[Michael Sidjimore]

They, they figured it out because they have the scale to figure it out and they have the brand. And I think they've used Their brand to be early and educate the market very early on. Blackstone University was an innovation in this space to educate advisors, but they've also put a ton of capital. And I do think that in order to work with the wealth channel effectively, and this is partially why we're seeing partnerships, this is why we're seeing consolidation, you need to invest enough capital.

[Josh Brown]

You need people, you need wholesalers, you need people.

[Michael Sidjimore]

But you actually have to invest enough capital to do that. The firms that have the scale to put their balance sheet and invest capital to do all of that and are willing to spend on marketing local area.

[Josh Brown]

Like shock troops could show up and, and be friends.

[Nicole]

You need John. You need John McEnte.

[Josh Brown]

John McKen.

[Michael Sidjimore]

How do you go to Ed. How do you go to Edward Jones? If you want to work with them? Right. You got to be.

[Josh Brown]

I have a guy who covers. I have a guy who covers me for Black Rock.

[Nicole]

No, no, no, he's at Osprey.

[Michael Sidjimore]

Excuse me?

[Josh Brown]

Oh, he's at Osprey now. All right.

[Nicole]

Of course he is.

[Josh Brown]

Forget the story I was going to tell you. Everywhere I go, I just run into this guy. He covers me so well. I'll like show up randomly in a restaurant somewhere and he's like, hey, good to see you.

[Michael Sidjimore]

Did you share your location with him or something?

[Josh Brown]

No. Crazy. He's so good at what he does. Unbelievable.

[Nicole]

Michael, what area of the, of the private markets? There's so many different areas we haven't even spoken about, really. Data centers, infrastructure, GP stakes. What area are you most excited by? Or, and, or. What do you think resonates most with advisors?

[Michael Sidjimore]

I think what I'm most excited about is not necessarily the same as what resonates most with advisors. I think private credit resonates most with advisors now for reasons you discussed. And I think it's also a very. It's an entry point into private markets because it's not as illiquid as private equity to understand. It's. It's loans to companies.

[Nicole]

Yeah, we get it.

[Michael Sidjimore]

There's a. There's a current yield. I think that's an important piece of this too, which is advisors.

[Josh Brown]

Income.

[Michael Sidjimore]

Want to. Yeah, they want income.

[Josh Brown]

And guess what?

[Nicole]

In 2022, when rates went up, these things are floating rates. They didn't get killed. The option. They did great.

[Michael Sidjimore]

Exactly. So I think private credit has been the first foray for many advisors. Secondaries, I think is also very popular right now because similar thing, there's a structural imbalance in the market. So there's a lot of capital that needs to be unlocked. And there's been a lot of capital raised in secondary space. But there's still reason to believe that the secondary firms can have their pick of what assets they want to go after. Now there's structural challenges in private markets and there's innovation around.

[Josh Brown]

Prior to secondaries becoming as big as they have, you really had to rely on going public. That's increasingly difficult to do.

[Michael Sidjimore]

Number of private companies has, a lot.

[Josh Brown]

Of companies don't want it. Investors risk appetite after the first day or two. They just, they abandon these companies. You don't have the research coverage on Wall street to support a small cap or a mid cap company. Like analysts aren't, you know, there aren't enough analysts cover all these. So for that reason that's the structural imbalance. You don't have the liquidity from public markets. I guess philosophically when you have secondaries, these are almost like public securities at that point.

[Nicole]

Well, OpenAI just did one. It was in the secondary but their employees were able to set a $500 billion valuation. And yet, and yet a lot of these private companies, even the giants like OpenAI and the others.

[Josh Brown]

OpenAI not a public company.

[Nicole]

$500 billion. I mean it's Walmart soon.

[Michael Sidjimore]

But that's a great example though of what private markets has become.

[Josh Brown]

Right.

[Michael Sidjimore]

There's this evolution in broader markets where the number of public companies has halved.

[Josh Brown]

From 2000 to today we have like 3500 public companies. That's it.

[Michael Sidjimore]

It's tiny. How do you get access to the universe of company like a $500 billion company that's private and if they're doing secondary offerings, there's some level of the. It's not liquidity in the same sense as there's daily liquidity. But SpaceX does tender offers on a regular basis. So these big companies need to figure out how to create liquidity mechanisms for their employees and or investors. That I think is a great example of what private markets has become. I mean it's an entire universe that probably should be. At the very least if people are investing in meme stocks and crypto, they should also have the ability to.

[Nicole]

But that part, that part is that part of the market is still not built out for the everyday investor. Not even close. Even for, even for reas it's difficult to get your hands on those shares.

[Michael Sidjimore]

Sure.

[Nicole]

And it's a pain in the ass.

[Michael Sidjimore]

And that's why I think this is going to be advisor led for a while, as it should be. The brokerage firms are starting to do this, Schwab announced earlier this year that they're rolling out private markets offerings to their QP client through brokerage. It still has to be advisor led. Either the brokerage client has to call up their advisor or they have to ask for a Schwab advisor who sells private markets to be able to invest in it through their brokerage account. But soon you're going to see private markets products. Probably Evergreen Structures is in brokerage accounts.

[Josh Brown]

We're coming to the end of this, but I can't let the moment pass without asking you, is the. Is the douchiness quotient of the industry being like, overplayed on social media? Is it not as bad? Because you probably know a thousand people working in the industry. I probably know 100 or 200. I don't really find that these people are any worse than any other people I've ever met in finance. But like, let me play this for you. John, can you hit that link for me? Topic, sex industry. Do you know who Johnny Hillbrandt is?

[Michael Sidjimore]

No.

[Josh Brown]

Oh, you're in for a treat. All right. Do you have to log in in order to play?

[Nicole]

So, Michael, what else is going on?

[Josh Brown]

Yeah, what'd you have for lunch today?

[Michael Sidjimore]

I'm ready for football season.

[Nicole]

Who do you guys open with?

[Josh Brown]

You're a Commander's fan. Is that. Is that because private equity owned. Makes sense?

[Michael Sidjimore]

Of course. I mean, private equity came to save.

[Josh Brown]

The day, honestly, like, it's so much better now than it was.

[Michael Sidjimore]

Does that say that private equity is.

[Josh Brown]

We're going to be a good thing. We're going to see. We're going to see a lot of, I think, minority stakes in sports teams. And those are going to be very popular.

[Nicole]

The Koch brothers just took a 10% stake in the giants at a $10 billion valuation.

[Michael Sidjimore]

Yeah, I mean, if you think about. So sports teams are an interesting one though, right? Because it's the media. Deals have just consistently grown in lockstep as more people continue to watch sports, as the streamers get involved. So. And I think there's been data from Arctos and others that sports are relatively uncorrelated assets to other parts of the market.

[Nicole]

No, they are uncorrelated. Come on.

[Josh Brown]

They will be less uncorrelated if and when thousands of people are invested in them. And then all of a sudden.

[Nicole]

Yeah, because, dude, people are going to next game. It doesn't matter what the environment.

[Josh Brown]

I think everything becomes correlated as more people invest in it. You don't think so?

[Nicole]

No.

[Josh Brown]

Not a thousand percent. Sure. If I agree with that.

[Michael Sidjimore]

Who. Who's the buyer? Once the giants get to Saudi Arabia.

[Josh Brown]

Saudi Arabia? I'm pretty sure Saudi Arabia is going to end up owning several major sports. It looks like they own golf. They forced a merger with the pga. Like that happened in a year. It didn't really take that much money either. So if you think that they're not going to end up owning franchises in sports or owning entire leagues, you're crazy. Of course they will.

[Michael Sidjimore]

You think the leagues will ultimately let that happen? They'll have no choice.

[Josh Brown]

You'll never have enough money to. How are you going to compete with Saudi Aramco?

[Nicole]

No.

[Josh Brown]

It's trillions versus billions.

[Nicole]

401S. We already know 401ks. The Knicks in my 401k.

[Josh Brown]

All right. We're not gonna be able to do this.

[Michael Sidjimore]

I'm having issues getting it in.

[Josh Brown]

Yeah. All right. Can I play the audio? Yeah, you can just play the audio. All right, we'll go. Audio Leveraged by.

[Johnny Hillbrandt]

Yeah. Sycamore. Yeah. Sycamore just dropped an insane $23.7 billion on Walgreens. That's so sick. It's the largest retail LBO in history, and it. So they took the company off the nasdaq. Yeah. You know that play? Oh, it's going to be so sick. My bad. Well, yeah, Walgreens have. Appears to have more annual revenue than any other company that's ever been acquired by P.E.

[Josh Brown]

So that's substantial.

[Johnny Hillbrandt]

And look, I know a couple of the guys over at Sycamore. They're really salt of the earth, fellas. I've golfed with a few of them. One of them has a son on Tarantino's squash team. And actually the other Tarantino spars with one of the other guy's sons in Jiu jitsu. Yeah. They're four years old. Yeah, yeah. Very cool. Sorry, what was that?

[Josh Brown]

Oh, no.

[Johnny Hillbrandt]

Sycamore has no healthcare experience. No, no, none. But those guys are. They're awesome. Yeah. They're gonna absolutely print.

[Josh Brown]

They already were.

[Johnny Hillbrandt]

I know one guy that I know. He was rolling up pediatric dental offices. Yeah. In Arizona. California. Ah, he's absolutely printing. Yeah, yeah, yeah. The guy only flies private. Yeah.

[Michael Sidjimore]

Oh, he's wearing a vest. Okay.

[Johnny Hillbrandt]

He's 27, so this my man. It's going to be very cool. I'm so thrilled for everybody.

[Josh Brown]

That's. All right, enough. That's Johnny Hill Brandt, one of my favorite creators on Instagram. He's absolutely hysterical. He. I don't know if you've. Nobody's Ever sent that to you before?

[Michael Sidjimore]

No.

[Josh Brown]

He's done like 500 of these videos as the same character. And, like, it's the most pretentious asshole you've ever seen in your life. And all his videos are like, I'm in Nantucket now. I'm in the Hamptons now. I'm at F1 race. Like, just on and on and on, and they're never not funny. But he has this. He doesn't work in the industry. I think he's a standup comedian. He just has this Persona down to a science and don't like. It's not my fault. That video I played for you has 6,000 likes. All of his videos blow up because everybody knows one of these people. He's obviously an extreme version, but is it unfair or is it sort of on the mark or do you know these people and they don't represent the whole industry? Oh, man.

[Michael Sidjimore]

I'm sure.

[Josh Brown]

Look at the pause before he could.

[Michael Sidjimore]

I'm sure there are people like that. I think there's a lot of people in the industry who. One really enjoy building companies.

[Josh Brown]

Yeah.

[Michael Sidjimore]

And that could be investing in and building companies that they're investing in. And also I think at this point, like, the firms themselves are business builders, and I think they find that fascinating and interesting. Obviously, it's good for them, no doubt. But I think there's a lot of people in the industry who are not like that. I will say those focused on the Wealth Channel, and I've spoken with. Oh, yeah, many is not the one that you sent. I've spoken with many of the heads of private wealth on my podcast, their business builders. They're building a business within a business. I think they take their job very seriously and believe in the merits of private markets. They understand the importance of educating the Wealth Channel. They know that's critical, both educating advisor and end client if they want to actually be able to do this well. And I think they also know that if advisors don't have a good experience and clients don't have a good experience from the start, they won't work with them again. Advisors are very fickle. And you have one shot.

[Josh Brown]

I totally agree with you.

[Michael Sidjimore]

You have one chance. So I think a lot of. A lot of those in the Wealth Channel who I speak with, I think they really do care about how they do this and making sure they do it right so that private markets does become something that is another tool that the advisors can choose. I think the other thing that is important to say is we don't live in A world without memes. We never have and we certainly won't anymore. We've gone through the memeification of everything, but certainly the memeification of financial services. I think that's an important point and something for those in financial services asset managers to really think about and understand. Because I think they need to realize and think through how they want to work with the wealth channel. That might be different. They may have to evolve how they do things and think about things a little differently and lean into that a little bit in a way that's true to who they are and who their brand is. But also recognize that at the end of the day, finance is a serious business. It's people's money. That's probably, if not the most important thing. It's one of the most important things that people have and hold sacred because it enables them to do all sorts of things in life from take care of themselves and their family, to do whatever they want. So making sure that advisors and end clients have a good experience, their money is safe, kept and they generate returns. Private equity and private markets don't work unless the returns are higher than public markets. Why do it? It has to be done same subject.

[Josh Brown]

To the same pressure that every other asset class is subject to.

[Nicole]

I don't know, man. I take minus 50 basis points for no liquid. I mean, for no marks, I pay it honestly.

[Josh Brown]

So the guy that's being caricatured here is not the guy that they would send to interface with a wealth management firm. That's more of like a portfolio manager. And he keeps saying, due to my role, I have substantial wealth due to my role. Like that is. That is not the face that any private equity or credit firm would show to financial planners or fiduciaries.

[Michael Sidjimore]

And it can't be. I mean, they, they really need to make sure they understand who the advisor is. There's different types of advisors, there's different types of clients. They need to make sure they're understanding what product they're selling. And they need to build their brand in a way that reflects who they are. I think we're going through a huge brand evolution in asset management. I think we're seeing this collision of culture and finance. And I think firms are gonna need to lean into that. I think they are gonna need to think about culture and how to appeal.

[Josh Brown]

To culture, not just culture, but like how to broadcast, like show people what your culture is about.

[Michael Sidjimore]

And they need to do. But they need to do it in an authentic way. I think they need to be out there Talking to people. They need to come on podcasts like this and just be able to chop it up.

[Josh Brown]

Can I tell you something, Michael? Can I tell you something? I think they could all learn a lot from paying attention to the way that you carry yourself and what you're doing. So I hope they are. I'm sure they are. And you do a really great job communicating the virtues of the industry. I could tell you're passionate about it, and we had a lot of tough questions for you. I thought you came through with flying colors.

[Nicole]

Can I just say one more thing?

[Josh Brown]

Nope.

[Nicole]

You know, so.

[Josh Brown]

I'm just kidding. God.

[Nicole]

God.

[Josh Brown]

No, no, no. I was rapping.

[Nicole]

The moment passed. Now I know you were rapping.

[Josh Brown]

Do you want to say something nice about Michael?

[Nicole]

No, the moment passed. That's okay.

[Josh Brown]

Bring it back. I want to hear you.

[Nicole]

No, no, no. Really, really and truly. It was. It was a. It was a bad joke. It would have. It would have. It would have played, but the moment is over.

[Josh Brown]

Wrap it up. I'm so sorry. I stepped on that. That's okay. All right, guys. Want to say thank you to Michael Sidgemore for coming by. I want to tell people where they can follow you, because I think, like, we did an hour probably doesn't do justice to all the things that are happening in your space. People are going to want to learn more as a result of this conversation. I know I do. Where should they follow you? Where can they get more information about things you talk about?

[Michael Sidjimore]

So Altco's mainstream.

[Josh Brown]

Let me say hat on. Yeah. Oh, wait, you got a headphone on. Sorry. Forget it. This is.

[Michael Sidjimore]

This is coming your way. I got. I got some hats. Hats for you guys.

[Josh Brown]

All goes mainstream, but, yeah, so.

[Michael Sidjimore]

So, yeah, alcohol's mainstream is on substack, so I write every weekend, and I have a podcast at least once a week, sometimes more.

[Nicole]

Your substack is amazing. I've told you that before.

[Michael Sidjimore]

Appreciate that.

[Josh Brown]

Do people want to hire you, like, every day? Like. Like, how many people are trying to just be like, we'll buy your. We'll buy your thing. Just come work here. How it's got to be everybody.

[Michael Sidjimore]

It has happened. I think. Look, I think it's important to stay independent. I work with a lot of different firms. I think that's part of the. The. The importance of this is being able to talk about what's going on in the industry and putting the pieces of the puzzle together for everyone.

[Josh Brown]

Yeah.

[Michael Sidjimore]

My 40,000 foot view. I think every firm needs to have their own way of educating and their Own amplification methods. That's through socials, through their own content that they produce. But I think also having independent platforms for. That's important. So I want to stay independent.

[Josh Brown]

Well, you have. You have probably the leading independent platform for it, so I think it's amazing. Hey, we always end the show asking people what they're most looking forward to. I'd love to hear anything in your life or in your business or any events you're going to. What are you. What are you looking forward to right now?

[Michael Sidjimore]

Future Proof. You could say I am looking forward to future proof. I've written about this. I actually really am. I think Future Proof is this great intersection of finance and fun. You guys have figured it out. You guys have figured out how to celebrate advisors and make sure that they understand who they are and how to build their business, but do it in a way that's fun and I think.

[Josh Brown]

Are you bringing the pot out?

[Michael Sidjimore]

I'm moderating a panel.

[Josh Brown]

Okay. Is it on Alts?

[Michael Sidjimore]

It is on.

[Josh Brown]

Okay. All right, cool.

[Michael Sidjimore]

It is on Alts. There's a traditional asset manager on there, too, because we're going to talk about the convergence. But no, I think there's something that it's hard to explain other than seeing it in person, but people in casual outfits on a beach, but talking about really interesting intellectual topics within their industry. I think it creates this unique element that you can't get from sitting in an office or just doing a conference in Midtown.

[Josh Brown]

Totally.

[Michael Sidjimore]

And I think that's. I always look forward to it every year. I think it creates this way of just thinking about what you're trying to do as a business. I mean, the advisors are really. They're trying to learn from each other.

[Josh Brown]

You know who this guy is?

[Michael Sidjimore]

No.

[Josh Brown]

My friend Robert Bahari. He's an independent financial advisor in Australia. How many Australians do we have coming, do you think? 25 or 30. 25 or 30 Australian. How cool is that? Right? So shout out to Robert for coming by the studio. We really appreciate you sitting in for this.

[Michael Sidjimore]

We had an audience today.

[Josh Brown]

We're gonna have. Yeah. So we'll have 30 financial advisors from Australia at Futureproof in California. I think the Canadians are sending over 100. So it's like, it's really a cool thing. I'm so glad you're going to be there, and I'll try to catch a session. Michael, what are you looking forward to?

[Michael Sidjimore]

The Giants losing to the Commanders Life Giants?

[Josh Brown]

Yeah, Giants football season's good answer.

[Nicole]

I'm looking forward to Russell Wilson getting out of New York. It's enough already. Yeah, I don't want to.

[Michael Sidjimore]

You're on the Jackson Dart bandwagon. Is that what it is?

[Josh Brown]

I know what happened. He's going to go 03 and the crowd is going to demand Jackson Dart. That's a. That's my prediction for New York is a fickle market. Well, yeah, so we're very. We're very discerning.

[Michael Sidjimore]

You're a Giants fan too, right? No.

[Josh Brown]

Yeah. Yeah. So that's the thing I'm not looking forward to. I'm not going to focus too much on it, honestly. I'll watch all the games, but I'm not going to get upset. It's just. It's not our ERA right now. It's just not right. You think that's fair?

[Nicole]

No, we bottom last summer or last. Last season.

[Josh Brown]

I think we could be okay. It's just not.

[Nicole]

This is not like, so depressing. I can't.

[Josh Brown]

Let's just. All right, guys, we get out of here. Thank you so much to John, Duncan, Nicole, Rob, Graham, Shark Kid, Matt, Sean, Keith, everyone who works on our shows. Daniel, Travis. What a week we've had. Huge thanks to our guest, Michael. Please follow all goes mainstream. Great podcast, great education. The substack is lit as well. Guys, next week know what are your thoughts on Tuesday on the YouTube channel because we will be in Huntington beach for future proof. We will have a Compound and Friends episode though at the end of the week and it'll be live. We are hosting the CEO of Franklin Templeton, Jenny Johnson. Jenny is an absolute killer. Michael Batnik and I are so excited for that conversation. So look for that next week. Thank you so much for watching. Thank you for listening. We'll see you soon. All right, we're out. We got it.

[Michael Sidjimore]

What the.

[Josh Brown]

Yeah. Is that good?