A (4:15)

Has the nature of how you invest changed? And I mean in the sense of it's. It seems like we've gone from a traditional sort of LP structure. There seems to be a lot more co invest now and there's different products available.

B (4:26)

I don't know that the nature of how we invest has changed. There are some things that have changed, but one of the things we love about our business and our approach is we've been very consistent over an exceptionally long period of time. We focus on high quality assets that make up the backbone of the global economy. Critical assets, services that really drive the growth and productivity of the communities and countries within which they exist. Now it's easy to say that we've been very disciplined and focused on that approach and that theme. But there are things that have obviously changed. The assets and services that make up the backbone of the global economy are constantly evolving. We give the example that probably 2/3, maybe even 70% of what we invest in today was not an investable asset class 15 or 20 years ago. 20 years ago we invested in hydro dams. Today we invest in solar and nuclear and batteries. Twenty years ago we invested in ports and railroads. We of course still invest in ports and railroads, but we also invest in data centers and fiber and telecom towers. So while we've been very consistent and focused on the backbone of the global economy, that of course changes over time. The other thing that changes is while our downside focused approach to investing targeting that backbone of the global economy has been very consistent, a big part of our business over the last really 10 years has been taking that approach and either packaging it different to meet the needs of a different and growing and increasingly diverse spectrum of LP partners and clients and also distributing those products in different Ways. I'll give the example that 10 years ago I think we had four products, today we have 60. And what has happened over those four years is we've been very consistent in the verticals we focus on. We focus on infrastructure and real estate and private equity. But within each of those verticals, we used to just have a flagship strategy. Now we look to have a flagship strategy, a mezzanine debt strategy, a super core strategy, a strategy focused on the retail wealth channel. And that's led to using that same consistent and approach and focus of investing, but distributing it, packaging it across a wider spectrum of products, such that it can be used to service a wider spectrum of partner and clients.

A (7:25)

One thing I'm curious about is your meteoric rise. You went from cibc, jumped into Brookfield, and you've just been on this trajectory that is hard to imagine. What do you think contributed to that? Like, what did you have that other people didn't have?

B (7:42)

At least part of the answer has to be good fortune, of course. And good fortune in that was fortunate to work on some transactions and initiatives that were very successful. Good fortune to, in a few different places, be right place, right time, things more tangible. However, I had incredible mentorship first and foremost, and the obvious one that jumps out there is Bruce. But it goes so much beyond that. You know, right from the first boss I had at Brookfield, that gentleman was, you know, as much boss as mentor and friend to me and really helped me develop. And while it was early in my career, I think a lot of the things he taught me paid huge dividends down the line.

A (8:28)

What are some of those things he taught you?

B (8:30)

I do think one thing that perhaps junior investment professionals spend a lot of time focusing on is trying to get the model or the analysis perfect. There's almost a false degree of precision in today's world of Excel. The reality is, so many times you just have to overlay good judgment and you have to recognize there are certain things outside of your control that your Excel model will seem like a certainty, but aren't. And then another thing I really attribute to that first mentor and boss I had at Brookfield is, and I might get the exact words wrong, but something along the lines of there's no absolute certainties in this business. So when something feels 90% right, you do that transaction or you do that deal. And the most important thing is you do 10 of them and you're going to be right nine times out of 10. And that's really, really good. If you wait to try and de risk everything to the absolute nth degree. Amazing. You'll de risk your transactions. You'll also do none of them. Other things that I think were, you know, maybe just going a little bit further on that point is one of the things that was very formative, I would say, in my career was after joining Brookfield, I did four and a half, five years, initially in the private equity group in Toronto, and in 2016, I moved to London. And concurrent with that move, I switched to the renewable power team at Brookfield and was part of a small group that was focused on building out a European platform. That was amazing. There is a incredible forcing function of not working in the same office as your boss, if I could say it that way. You're not going to send an email to ask to send an email. You're not going to wait five hours for the time zone to catch up to check something if you're pretty sure it's right. And maybe this is personal to me, when you begin to take the initiative and do those things on your own prerogative, you think you're going to have a really low shooting percentage. And then almost shockingly positive to the upside, you actually have a much higher shooting percentage than you expect. And that's fun. You know, you start getting stuff done, you start making progress, you start building things with the team around you and you get some momentum. And that almost spirit and excitement just snowballs from there.

A (11:05)

I think the story is you were told to go to renewables, not necessarily asked, how did you feel about that?

B (11:13)

So this was in 2016, and when I was asked to move to London, concurrent with that move, I switched teams. And people always say, oh, did you want to join renewables? The honest answer is no. I didn't have some weird desire to or some strong, specific desire to go to renewables. But Bruce and Cyrus Madden, who built our private equity business, asked if I would, and I, of course, said yes. And if they'd asked me to go into infrastructure or real estate, I'd probably have a different business card today. I love the firm and I do whatever they asked me to. Again, I was very fortunate that I joined the renewables team in the early innings of what has been one of the largest and fastest growing industry builds in history.

A (12:03)

So we had big tailwinds with renewables. You had great mentors. Something specific to you that other people have mentioned to me is just your work ethic. Talk to me about that.

B (12:14)

There's a lot of people that work really, really hard. I've always felt that that's Something within your control that can be a differentiating factor. And it's really two things. One, yes, if you work hard, you have a bigger capacity to do more stuff. That's the obvious one. The other comment or dynamic that I think is sometimes underappreciated is, um, just being available for other people on the team. And there's always people both. Both junior and. And senior to you that have questions, want to bounce an idea off you, want career advice, deal. Specific advice, and just being available for people and always being willing to make time. And, yeah, maybe that means you're, you know, taking calls while you're walking through an airport or at. Late at night, but, um. I think it's funny, I. I don't know that when people think I work hard, it's, you know, I was crunching more Excel models or building more PowerPoint. I almost think it's the availability that. That people perceive as. As. Or represent as working hard.

A (13:32)

Did you have any setbacks along the way?

B (13:35)

Oh, tons.

A (13:36)

What are some of the ones that stand out?

B (13:38)

Yeah, for sure. There's always deals that didn't go well, or, you know, let me almost put it as. I. I remember very early in my career, again, another great mentor. This was very shortly after I joined Brookfield. They. They made a comment to me, connor, you're doing really well. You're.

A (13:58)

You're.

B (13:59)

I had a bit of a unique background before I joined Brookfield. I didn't really have a financial modeling background or evaluation background. And then I joined a private equity group in an investment position. So I had a pretty steep learning curve at the beginning. And. And I remember maybe 12 or 14 months in, someone said, you're doing really well. You know, you're picking up the skills, you're producing great work, but when you go to present it, nobody knows what you're talking about. You're trying to explain too much. Your explanations are too complicated. I remember when I got that advice initially, it put me in a tailspin. I was crushed. I thought that was the end of my career. And then you wake up the next day with a fresh perspective and you go, it was tough to hear that. That people don't understand what I'm talking about, but so great to learn that now and focus on it. And then you realize that it's not just the ability to do the work, but explain the work. And if you can't do both, it's kind of irrelevant.

A (14:58)

You mentioned sort of getting to 90%, and that's sort of the target you want to get to. And you want to do 10 deals. How do you think about de risking deals? Do you isolate particular variables or how does that work?

B (15:11)

So much of what we do is at Brookfield is de risking different business activities in such a way that we can turn the construction of a project or the operations of a project into a long term inflation linked stream of cash flows. We are very comfortable taking execution risk, operating risk, development risk. We don't like to take market risk and we work very, very hard to, to structure our deals or execute in such a way that we're, we're not taking market risk. And I'll give an example of that. When you build a renewable power plant, let's just say a solar farm, there's really four key drivers of what your end return is going to be. It's your construction cost, it's your revenue offtake, your power purchase agreement, it's your EPC and your financing. We are very fortunate to have built one of the largest renewable power operating and development platforms around the world. Whenever we build a new project, we do not like to put capital in the ground unless we lock in our CAPEX contract, our off take contract, our EPC contract and our financing contract all at once. Because if you lock in those four things and you execute, it doesn't matter if interest rates go up or down, you've locked in long term financing. It doesn't matter if power prices go up or down, you've locked in a long term contracted revenue price. It doesn't matter if inflation goes up or down, you've locked in your CapEx. So, and we do that in our power business. We take a very similar approach to our real estate business. Building new real estate on behalf of long term tenants. We're now doing it in data centers, building gigafactories on the back of long term contracts with hyperscalers or sovereign offtakes. It's a very repeatable business model where we're comfortable taking operating and development risk. We feel we have an expertise in that. But we work very hard to structure and de risk out market risk.

A (17:25)

What's epc?

B (17:26)

The construction company, the engineering, procurement and construction.

C (17:30)

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A (18:21)

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B (19:05)

It's very similar. You've got your construction cost, you've got your power supply, and you've got your long term compute contract. Data centers are fascinating today because it's not that long ago, maybe only five, six, seven years ago, when an investor was investing in a data center, they were really funding the rack in the shell against a long term offtake, typically with a hyperscaler long term take or pay inflation linked offtake. There's three things happening in the space that are expanding that opportunity very rapidly today and they're all compounding on each other. There's more data centers being built. The data centers that are being built are bigger than the ones that used to get built. And then the third thing is where historically the investor would fund the rack and the shell, increasingly now that investor is funding the rack, the shell, the chips, the servers, the power supply, the grid connection, the substation, the redundancy. They're funding that whole data center plus the energy supply chain. But it's still all wrapped in that long term offtake, typically with an extremely high credit quality counterparty, either one of the big global hyperscalers or a sovereign offtake.

A (20:28)

That's interesting you mentioned the high quality counterparty because one of the things that strikes me when I read these headlines anyway is, you know, $100 billion contract over 10 years or something. You really have to like. There's a lot of embedded risk in that. The headline numbers are great, but can people pay like five years from now? What if it's a depreciating asset? What if it changes?

B (20:50)

So, two things that are interesting there. One, the amazing thing about we'll call it AI infrastructure today is who are your counterparties? These are literally the greatest companies in the world, the highest credit quality counterparties in the world. The large tech companies, they're the greatest companies in the world today. They're almost undoubtedly the greatest companies of all time. That is the corporate credit counterparty risk you are taking, which is as good as we've ever seen. The other point that's perhaps interesting is sometimes we get asked, why do things get turned down during an investment process at Brookfield? And of course, there's a pretty wide range of things, but I would say of deals that we choose to pursue, but then in diligence or in structuring, decide to walk away. There's two reasons that are most common. One, we don't like the revenue construct or the corporate credit counterparty that backstops that revenue construct. That would be reason one or reason two. It's too much construction or development risk relative to the return that the opportunity generates. I would say those across our infrastructure business, across our real estate business, across our power business, those are absolutely the two most common reasons we choose not to do a deal after initially reviewing it.

A (22:22)

How does a deal actually come to be? So you have people sourcing deals all over the world. You have boots on the ground in, I don't know, like 100 countries or however many countries you have, and then it comes up to one sort of investment committee. How does that work?

B (22:38)

Certainly that sounds really hard. We're very fortunate to have an extremely large platform that is very global in nature. And what's been built over a number of years now is a unique business where everywhere we either seek to invest or we own, operate and manage assets. We like to have a local boots on the ground team and that team typically can be split into two. We like to have local investment professionals as well as local operating professionals, and there's actually a third. We also typically have local fundraising professionals as well in all the markets that we operate. And the obvious question is, how do you manage that if you're in all these different regions and asset classes around the world? We've pursued a model where those local teams are given the responsibility and the autonomy and the accountability to, to source, execute and operate very independently. And we want those teams to know those markets inside and out, see all the local dynamics, hopefully before others see the dynamics that are value creation opportunities and position our businesses to capture that value, see the risks that are coming and position our businesses to mitigate those risks. And while we give those local teams lots of independence and autonomy to source, execute and operate. When it comes to capital deployment, all capital deployment decisions get brought centrally to a fairly tight group for approval. And it's through that function that a small group at Brookfield can have visibility of everything that's happening around the world, which is just good for perspective and controls and things like that. But it allows us to get the growth of having local boots on the ground, but also the ability to manage and oversee everything. The also the underappreciated benefit of that model is it gives us incredible global perspective. If one of the teams in one of our regions around the world is bringing forward an opportunity, it might be the best opportunity we've seen in that region in 12 or 18 or 24 months. But if it's not holding a candle to the risk adjusted returns we can get in a similar opportunity in another region, we have that central perspective to say, you know what, we're going to allocate our capital to where we're seeing the best opportunities globally and across asset classes.

A (25:15)

I'm curious about what type of information flows up, does that committee have a name? Whatever information flows up into the small group of people who are deciding where to allocate capital and then how do you take that information and disseminate it? So you learn things in like one part of the world and how do you apply that in another part of the world?

B (25:36)

There's two things there. We obviously have an investment committee process that's important because it, it substantiates approvals and things like that. And it's, it's a process that's communicated to, you know, our LP partners and we of course adhere very closely to that. The one thing I would stress is we don't treat our investment committee like a single discrete one time event where an opportunity is going to be presented for the first time and then ruled upon all in a one hour meeting. Our investment teams around the world, through the life cycle of the investment, they are constantly iterating with not only the members of the investment committee, but the leaders of that platform to get feedback along the way, make sure they're building consensus. No deal is perfect. There's always unique dynamics or nuances. They're making the appropriate Men and women aware of those getting feedback. A lot of our businesses have a process where there is a very, very detailed review, you know, three to four weeks ahead of the final investment committee with very senior individuals. And the goal of that is almost preliminary meeting, whether sometimes it's called a capital committee or something like that, is that's where you can get really good feedback on an opportunity. You can draw on the experience of the whole business, but you still have time to take that feedback away, maybe do a little bit more diligence, maybe tweak the deal a little bit. Well, before you go for a final investment committee approval, Shane, the other thing you mentioned there, I always give this example is Brookfield really runs like a partnership. And I been fortunate to have helped build the power business over the last 10 years and led it for the last five. I'll give this example on a day to day basis. When I was just starting to lead the power business, I didn't necessarily have a whole lot to do day to day with our real estate business. But if I hadn't talked to Brian Kingston, who's one of the senior guys in our firm, who, who was leading our real estate business at the time, one of us would phone each other every two or three weeks. What are you seeing? What's working in your business? What isn't working? Where are you seeing demand? Where are you seeing capital flows? There is that constant interaction. The business does not operate in silos, despite operating in four verticals. From almost a product perspective, it's incredibly collaborative with, with almost immense effort put in to consciously ensuring that we're always sharing information and perspectives.

A (28:26)

So the committee is not like a vertical. It's not like, oh, this is real estate committee. It's. You have other people sitting on that

B (28:33)

from different for sure. But even if they aren't you, you would pull their expertise in. I think one of the unique things about our, our approach is there really are no walls at Brookfield. And we really in tone from the top in how we develop people, even in how we compensate people. We really encourage collaboration such that when the firm has an opportunity, it doesn't matter what someone's title is or what region they work in or what investment strategy they may they spend the majority of their time on. If there is an individual within the organization that can be additive to an investment we're trying to do or an initiative within the company, we pull them in. Even if it's a private equity investment, if there's someone within our infrastructure business that can bring value, they get looped in. It doesn't matter what the job description on their business card is.

A (29:34)

There's two paths I want to follow here. One was, you mentioned consensus, but the example that came to mind for me was Westinghouse, which seemed like a very non consensus idea, at least from the outside looking at now, it's proved out to be very correct. But how do you think about taking bets that are maybe non consensus?

B (29:52)

Westinghouse is probably a good example of. Sometimes we get asked what's an investment committee process or what's that iterative process like? We focus a huge amount of time. The vast majority of the discussion will be focused on the downside. We like to believe that if you buy high quality businesses in good markets that have strong downside protection, if you underwrite the worst case scenario really, really well, the base case or the expected case will end up being very attractive. And Westinghouse was a great example of that. When we initially invested, it was not an in favor sector by any means, but it was a market leader. It was critical to the global supply chain of nuclear power, which at the time was not growing, but had a very, very long life tale to it of which Westinghouse was a critical supplier. And we felt it was an industrial operating business that could be run better using some of our operational expertise in other industrial businesses that could be brought to bear. And I can tell you we spent all of our time focused on the downside. And what was interesting is that proved out to be right. You know, Westinghouse is a market leader. It is absolutely critical to the supply chain. We were able to drive significant operating efficiency within that business. All of that would have led to a very good outcome. And then we got the upside, which is there was a complete revitalization of the nuclear power generation sector around the world. And Westinghouse was absolutely at the forefront of that. So we focused on the downside. We made sure our downside was protected. Our base case of an attractive return was delivered by things within our control. But there was asymmetric upside. If some uncontrollable things that we thought or hoped would happen did, but we didn't need them to, to have a good outcome, in that case, we had a very, very good outcome.

A (32:01)

What happens after you acquire a business? You know, I think Brad said, if you're, Brad Jacobs told me, if you're not improving the business, then you're just really moving money around. So what does that playbook look like when you go in? What are the variables that you're really focused on what's that first 120 days look like?

B (32:17)

It's funny, Brookfield is a unique in the alternative asset management space. We come from a background of being direct owner operators of businesses. I don't know if everyone knows this. Brookfield and its predecessor companies were founded around 1900 and for the first hundred years of our history, we were not an asset manager. We were essentially an industrial conglomerate directly owning and operating businesses ourselves. And that history really informs our approach today. We like high quality businesses that we'd be comfortable owning directly over the long term. We tend to be slightly longer term holders of assets. We take a very hands on direct owner operator approach to our investments. I would say this, we there's not an investment around the world today where part of our return bridge, if you will, doesn't come from operational improvement. And then the third thing is as a function of our history where we used to be 100 cents of every dollar we invested. Today the largest investor in Brookfield Products is still Brookfield's balance sheet. So your question, what does that look like? We've built a platform where we like to think we have best in class, industry and geographical expertise in the asset classes we invest in. Take power for example. We have people in every region around the world that we operate that are experienced in operating technical development, power, marketing, tax, legal, regulatory compliance. And when we buy a business, we bring that expertise to bear. Most of the time that expertise we have doesn't actually go into the company. It sits above the company and is simply there to support the business from above. In certain cases and depending on the extent of the turnaround or the operational improvement that we're seeking to do, sometimes we will put our own people into a business to drive change. You made the comment, what does the first hundred 120 days look like? Very important. There are certain standards that we like to implement 100 days, probably too long. Our health and safety standards, our global standards around certain processes and procedures, those are non negotiables. Those get rolled out right away. But they're generally things everyone can buy into. You know, you acquire a business as a new equity investor and you know, a Brookfield representative shows up on site and says we're proud to be the new owner of the business. We're going to look to drive some changes as you made it. Understand the first one, we always focus on health and safety and people that get health and safety right tend to be the best operators long term.

A (35:19)

How do you think about quickly getting capital out as a means of de risking so you buy a business and you put all this capital out and then how much of that first year or two is like how much capital can we get out quickly so we derisk this deal.

B (35:32)

It's an interesting comment. I would say it's very deal specific. When we think back over the history of Brookfield. I joined Brookfield about 14 years ago. I remember back then we used to say there were really almost two different types of investments we would target. You would either want to buy high quality businesses at an attractive value or a fair value, or you would consider buying a lower quality business at an exceptionally discounted price. What's interesting today is our business has really focused increasingly on the former. We want to buy extremely high quality businesses where you have incredible visibility into their long term cash generating profile. And you can have a lot of conviction that that cash flow will be there when one year from now, three years from now, five years from now, ten years from now. Because of that, I think there is less stress about trying to extract a bunch of cash in the near term. If you had a lower quality business where it's subject to increased competition, it's subject to perhaps some market variations that aren't in your control. Yeah, you want to de risk that really fast. Obviously we'll pull capital out of our businesses whenever we can, but given the types of things we focus on, we can take an approach of doing it very prudently.

A (37:06)

How do you think about leverage? I look at what's going on in real estate today and so much of that seems to be people got a little bit over their skis, which creates an opportunity for you. But how do you think about going into that with leverage where you're sort of trading off a little bit of financial return for survivability over market variations?

B (37:25)

I like the way you said that. There's two things about how we finance our businesses around the world. One is just the approach we take. We focus on asset level non recourse, long term fixed rate financing. It's sometimes not the cheapest financing, but it has some features that we really like. It takes away that market risk that we talk about, about interesting interest or financing cost changes over time. And the other thing is we like to do asset level non recourse financing that by choice is harder. You're doing a lot more individual financings rather than just grouping huge portfolios of assets and putting a debt facility over the top of them. But what it really ensures for us is if you ever run into something unforeseen, and I say something unforeseen to the downside or equally something unforeseen to the upside. Everything that you have to work through is done on an individual basis. And you're never tainting, if you will, an entire portfolio with the dynamics of an individual asset. And obviously people will focus on if you have an asset goes bad. It's nice if that doesn't taint a broader. But it's the same on the upside. If you get an incredible bid for a single asset, but it's stuck in a debt facility that won't let you release it, that inflexibility is not helpful to running your business. So the first thing we do is focus all of our platforms, non recourse, asset level, long duration, fixed rate financing. The other thing which probably isn't as obvious is we are huge believers that liquidity is almost consistently undervalued. Liquidity is this funny thing which is every time it's overvalued when you don't need it, and it's incredibly undervalued when you do need it. And therefore we like to prudently finance all of our businesses, but we always like to ensure that we have some excess capital for something unforeseen. And again, that unforeseen thing could be a positive or a negative. The negative maybe your business plan isn't going quite the way you expect. Having a little bit of capital to ensure that you can keep your covenants on side and give you that run rate to get your business plan back on track. Hugely valuable. Similarly, having excess capital for growth, perhaps when others don't, has probably been one of the biggest differentiating factors for Brookfield over cycles and over decades.

A (40:04)

That comes when sort of the market we'll say crashes or there's a panic or capital gets really tight and then you have capital, you're available to deploy it.

B (40:14)

Absolutely. And we feel that one of the truly enduring competitive advantages of Brookfield and something we spend a lot of time focusing on, is always ensuring that we have tremendous access to capital. Because again, when times are great and everyone has access to capital, that that doesn't seem as important. But having access to capital when others are not, all market participants do that is incredibly valuable and has proven to be valuable to us across asset classes, geographies, cycles.

D (40:44)

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A (41:54)

that without having lived through it? And I say this, you know, there's the 2000 sort of dot com crash, then there's the housing sort of crisis of 2008. But you haven't been deploying capital during those periods. And it's very rare that people have that perspective having not lived through it. It's almost like you have to live it to get the. I don't know. Talk to me about your thoughts there.

B (42:19)

100%. There's two things. One, this is where I think culture within an organization is so valuable. We really instill these principles day in, day out across our business. To the young man or woman who's just come out of school, who doesn't have any investing experience, this is what we do across market cycles. This is our approach. This is why we do it. You haven't experienced it yet, but here is why it is valuable and here are examples of when it was very valuable to us and why we do it across the cycle, even if it doesn't seem super important today. The other thing which just goes to an incredible dynamic within Brookfield is we're constantly as an organization mixing what I would say young, energetic. I always use the term individuals who can run super fast and jump super high. But mixing them with experienced people who have lived through those cycles, who have made investments, who have significant lessons learned that they can share. A big part of our culture is mixing that kind of experienced, more senior perspective with young, energetic, fast moving capability.

A (43:40)

Sort of what you had when you came in, almost in that way.

B (43:44)

Yes.

A (43:44)

We were talking before we started recording about dispersion of talent and how in some industries it makes a big difference. Where does talent matter the most at Brookfield and where would. Where. Where does it matter the least?

B (43:56)

Within our asset management business, our. Our most important assets go up and down an elevator every day. You know, we are a people business, and therefore talent is hugely important. One thing we believe is talent doesn't fit a perfect stereotype. We need lots of talent in different capabilities in different places across our business. And it would be unrealistic and unpragmatic to expect all the incredible talents we need to be rolled up in a single individual man or woman. We can have some people who are incredible judges of risk and return and incredible analyzers of businesses. We can have other people who are very good marketers who can explain what we're doing in a way, to an investor who isn't living day by day, 20 hours a day in deals every day of their life. We need people who are very good leaders and team builders and builders of platforms. What differentiates us over the long term is some mixture of the talent we have. And therefore, we spend a lot of time focused on developing it and retaining it, but then also creating a culture that can extract the best out of the talent within the suite of people that work for Brookfield.

A (45:25)

Go deeper on the. Extracting the talent out of the people who work there. Because I often think about, you know, we were talking about sports before. Like, I think about the NFL, right? And the NFL is a great example of, like, we have this incredibly talented person, and then we put them in this environment that we're trying to ma like, it's highly structured, it's highly organized, and it's all geared towards that person performing on Sunday.

B (45:47)

Yeah. It's funny, I think I love sports, and I feel like football is an incredible example because one of the things I love about. I live in London, so American football is you've got people that all play different positions. You've got offensive linemen who don't worry about catching the ball. They don't worry about running the ball, but their job is hugely important. Then you've got wide receivers who don't worry about throwing the ball, but want to be best in the world at running routes and catching it. Brookfield's no different. We want to. To your term, extracting the best value or the best talent out of our people. We want to find the things that we need to do as an organization, raise capital, invest capital, manage business product development, work with our teams, build platforms. We want to find the things that our people are the best at and allow them to really focus on those things. And, you know, if you've got a wide receiver who's great at catching the ball. You can support them with people who are good at other functions. And then there are a handful of people who need to be able to sit above it all and oversee everything, whether that's your coach, your football analogy, your coach, your quarterback, your ownership, and that's your executive team.

A (47:10)

I'm curious how you go about identifying talent. That must be such a hard thing because I think in finance, maybe I'll add some context to this and I want to spend a few beats on it. There's people who talk like they know what they're doing and then there's people who know what they're doing. It's not obvious, the two. And the other thing that stuck out to me is you mentioned that it always doesn't fit in a box. There's no central casting about what to look for.

B (47:35)

One of the things I love about Brookfield, I think a lot of people who work at Brookfield love about our approach is it is a complete meritocracy. We really don't care what your background is, where you were born, how you were raised, who you pray to, who you love. It's really about what value can you add to the firm. And again, that value can come in lots of different ways. But there is no stereotype that we are looking for. And it really all just boils down to how much value can you add to the firm. And as an organization, one thing we do, and perhaps different than other organizations, is we do identify young talent very early. We like to try our best to identify young talent very early and give them perhaps more responsibility and accountability than they would sometimes get in different environments. And when it works, it works incredibly well because you get these fantastic men or women in their early 30s who've been in the workforce for 10 years but have the equivalent of 20 or 25 years worth of deal reps or people management or product marketing that they would have had somewhere else. And those are incredibly valuable individuals to our organization. We obviously need to make sure we're very proficient in identifying that talent. And we also always need to check and make sure we are coaching that talent up over time. It's not a straight up into the right line for everyone.

A (49:27)

What do you look for? Personally, that's non obvious and I'll give you an example. I was listening to an interview the other day when I was doing research for this actually, and the guy said, I look for obsessive psychopaths. And it stood out to me. It was memorable. What are the non obvious things that you look for.

B (49:46)

It's funny. I'm going to give you the same answer, but sometimes we get it to a different question, which was, what are the attributes of Brookfield's culture or the people that do the best at Brookfield? The line I sometimes use is we like people who are almost kind of nerdy. And I don't mean they're nerdy in that they aren't enjoyable to hang out with or can't carry a conversation, but they're intellectually curious in that they like to look at a hard problem that other people have struggled to solve. And they're willing to kind of roll up their sleeves and put in the hard work to try and solve it to generate an outsized positive return or an outsized positive outcome for the business. We like those people who are intellectually curious and kind of the derivative of that is hard working and willing to tackle hard problems and putting in time and effort to solve things that others can't. That would be one. The other one is this is always a people business. It is impossible to get ahead in this business if you can't work well with other people. It doesn't matter how talented someone is. They're not more talented than the entire team of people you can put around them. And therefore having people that are accepting exceptionally good at different aspects of the job, but equally can work with others where they can complement other individuals or be complemented by other individuals to get more out of the broader team, those are the people that succeed the most.

A (51:22)

What does that look like inside when it goes wrong, the ability to work with other people?

B (51:27)

Well, rather than say it as a negative, I'll say it as a positive. One of the things I've always said about Bruce is it always seems like he cares more about the success of others than he does about himself. He's always more concerned about ensuring that other people get the credit or other people are positioned to continuously develop. What's interesting is you see that in a leader who built an amazing organization. You also see that in very junior people, those that just want to contribute to a good team outcome and aren't really worried about who gets the credit. I'm thinking back to the previous question. You know, sometimes one of the things, one of the ways I describe culture at Brookfield is we like those individuals who maybe they do a great deal or they complete an initiative that was very successful. The non Brookfield thing to do would be, you know, go on a three week victory lap telling everyone what you just accomplished. The Brookfield thing to do would be to come back the next day and say, okay, what are we working on now? And I do think you see that in very young people as a really redeeming and enduring quality. And when people don't have that, I would generally say they don't ascend or they don't last within the business as much as the ones that do. Does it need to be perfectly proportional? No, I don't think so.

A (52:53)

Are you guys using AI internally?

B (52:55)

Absolutely.

A (52:56)

How are you using it?

B (52:57)

So it's interesting. I always think there's three ways to play the AI theme, if you will. One is to invest in the models you invest in ChatGPT or Anthropic. And we don't do that. To be clear, there are some people doing it and being wildly successful. It's just not our area of expertise. The second way is to build the infrastructure that supports the growth and increased utilization of AI. And that at a simple level is, is the, the data centers and the power that supports them. And that is the largest and fastest growing investment theme at Brookfield. And it really brings together our digital infrastructure expertise, our power expertise, our real estate expertise. We feel we are market leading in that regard. The third area is using AI within our business. And we are doing this very, very. I think it's a fascinating topic. People say, how are you rolling out AI in our business? What's interesting is we own 500 companies around the world. We have encouraged all of them to use AI within their business. Trial and error, different AI applications that you think will enhance the efficiency, productivity, growth of your portfolio company. The only thing we ask is you share the results of that process. So if you find a solution that is very additive, it doesn't matter if that's in a infrastructure business in Australia, if they find a great AI application that is very additive to our business, we've created a structure whereby that information can be shared across the entire company so we can use it elsewhere. Similarly, if that company tried that application and it it didn't work, share that information such that 499 other companies don't try and have it fail. It's interesting. We're really seeing, we're very early days, but the impact is amazing. And there's two that would jump out. One is there's some places where AI is having a very discreet and very meaningful, positive, transformative, near term impact. Our private equity businesses really focuses on industrial companies and critical services. We're using AI to help with pricing models. We're using AI to reevaluate how some of our shop floors and factories are configured. Questioning processes that have existed for 20 years and some of the efficiency and productivity improvements that we're that are coming out of those exercises is amazing. That would be point one. There are two places across, I would say, almost a trillion dollars of assets where AI is having a huge benefit. And maybe it's not as exciting, but is very intuitive. One is preventative maintenance on a trillion dollars of real assets around the world, and the other is health and safety. For the 300,000 operating professionals we have in those 500 portfolio companies. The ability for a computer to look at a piece of machinery that only gets serviced every three or five years, but can just look at an infinite number of data points and use pattern recognition to say something doesn't look right. I know that piece of machinery is not supposed to be serviced for two more years, but somebody should go look at it. Sure enough, we send someone out to go look at it, and a bolt is loose or something is leaking, and we can preserve a lot of value. Similarly, just letting a computer that can run a million simulations instantaneously help people address health and safety concerns in different environments around the world. Those are the factory floor. One is much more discreet. Those two, preventative maintenance and health and safety working in the vast majority of our businesses.

A (57:12)

What does that look like in health and safety? In the same way that you sort of gave an example with what it looks like for preventative maintenance, like, how does it look?

B (57:20)

Some of this is actually using the technology. Some of this is a forcing function, if you will, in some of our infrastructure businesses, where people are constantly building different assets in multiple places. We have a program where when a worker shows up on site, they ask to use the camera on their phone to scan the site. And the program will say, here are 10 health and safety risks that we've identified. Now, candidly experienced workers probably would have identified those, but it's a great forcing function that, one, they have to do it. Two, they're reminded of it. Three, now they're thinking about those things. Health and safety is incredibly important in the businesses that, that we own. And this is a great way of using one of the greatest technologies in the world to drive one of our most important initiatives.

A (58:19)

Is there any other examples that come to mind where you're like, oh, that's so cool and it's giving you a competitive advantage, or.

B (58:27)

One of the things that we're seeing as we use AI in our business is it feels like sometimes there is this Fear, oh, AI is going to take everyone's jobs. That's not what we're seeing as much in our business. And that's a 30,000 foot statement. AI will cause some structural turnover in certain occupations, but really what we're seeing is it causing the same man or woman that you employed yesterday, they're getting two or three hours of their day back to focus on higher value parts of their job and therefore the same person who you liked and were supportive of, all of a sudden they're just more productive. And it's kind of taking the top off in terms of what we can expect out of our people and what we can expect out of our teams going forward. And it does feel like we are still in the very early innings of this. If you asked us more large scale, where do we think AI has a bigger impact? We think the role that robotics can play in so many production functions and industrial functions around the world now that, that robotics can be reinforced by computers that can think and run a million simulations in real time. Like everything, what's the term, it will happen slower than people expect, but have a bigger impact than people expect. We very much see that dynamic playing out in the use robotics that's sort

A (60:08)

of like the pattern of bubbles, right? Is that there's this hype. In the short term it always disappoints people, in the long term, it always exceeds the hype, but it's can you survive long enough to get the benefit out of it? Because people make fortunes but people go broke.

B (60:26)

It's funny exactly that dynamic. And again, we like to think we are one of, if not the leading investor in AI infrastructure around the world, which huge sums of capital are being invested in on a global scale. We often get the question, will there be overbuilt? Absolutely, unequivocally, yes. There's overbuilt in almost every product, in every asset class everywhere in the world, in every economic cycle. But the really important thing is, is that overbuild is not random. In our business we only build against long term contracts with, with high credit quality counterparties. We don't build on spec. And two, we're very thoughtful about where we build. We want to focus in tier one markets where there's multiple end users and multiple sources of demand. Such even at the end of that 20 year contract life, there will be multiple options to use that facility or to recontract that facility. To your point about, these cycles almost have a recurring trajectory to them. We see that in ours and we think there's incredible things that we can do while participating in this growth to avoid the boom and bust that sometimes happens in other asset classes.

A (61:58)

I'm curious when the last time Brookfield was the underdog.

B (62:02)

The way we, I would say as an organization approach the job or approach the opportunity is really we try to be balanced every time, you know, come in neutral. And we're very fortunate that we are at the forefront of some very, very large investment trends and investment themes and some very, very large asset classes to invest in. Such while we may invest at very significant size, there's always the opportunity to do more and therefore we're always looking to can we invest more at attractive risk adjusted returns. We don't spend a lot of time thinking about what have we done in the past. It's a very forward looking organization from that perspective.

A (62:53)

I remember Michael Jordan in the Last Dance. He said something that stuck out to me about the whole underdog thing. He's the best in the world at basketball at the time and he would make up stuff just to make himself the underdog. And I always thought that was interesting.

B (63:09)

Yeah, I don't know if it's that extreme, but it is a very enjoyable thing that we're fortunate to wake up in a business and investing in themes where the question is not can you grow? It's how much can you grow and can you do the right growth. And therefore it doesn't matter if we've done two, three or 10 deals already. If the 11th deal is very attractive, we want to do that one as well.

A (63:38)

I'm curious how you think about your, your ambition over the next 20 or 30 years.

B (63:44)

The first thing that comes to mind when, when I hear that is it is amazing what, what Bruce and the senior leadership team has built over the last 25 years. It's truly an incredible platform that's very differentiated and I would say somewhat under appreciated in terms of its scale and its ability to produce very attractive returns. But on a scale and a consistency that very few, if any, can match. That is truly the incredible value proposition of Brookfield is not just the returns we generate, but how consistently we do it and at what scale of capital deployment. And the amazing thing about the platform we have is it's got such an incredible organic growth trajectory that is very visible and goes out five, 10 years into the future where we have complete control over our success and that growth. What gets, I think myself and others who are coming up in the business very excited is can we continuously keep pivoting that trajectory above that incredible status Quo that's been passed down.

A (65:06)

If you look out, I think the plan that you guys made public was 2 trillion by 2030. Is that accurate? So if we were to go to 2050, hypothetically, what is that ambition? Is it that we're in the right places, is that we're managing a significant percentage of the world's capital? What is the.

B (65:26)

Maybe I'd come at it from two perspectives. From an investment perspective, what has helped build the business into what it is today is really two things that are going to look different in the future, but are very repeatable in the nature of what we need to do. One is that point of we're very consistent in the asset classes and the types of deals we focus on. But we spend an incredible amount of time thinking about where is the market going? What are the critical goods and services and assets that are going to make up the backbone of the global economy five years from now, ten years from now? We absolutely need to keep doing this and we need to continue to be as good about that in the future as we have in the past. And if we do that, the breadth of what we invest in is going to keep expanding. There's going to be some things that we think are going to be big opportunities today that will become big opportunities in five or 10 years. There's going to be some things 10, 15, 20 years from now that nobody is even thinking about today that as they approach, we want to identify them, capitalize on them, and then invest in them when they become large and attractive opportunities. So that would be point one. And the other thing that I think is really going to drive growth over, let's say 20 or 25 year period is alternatives are in a really exciting point today. They've grown tremendously over the last two decades essentially on the back of increased and growing institutional allocations to the space. And that's going to continue. The institutional allocations to alternatives are going to double from where they are today over the next 10 years. So that would drive tremendous growth in our business if we only focused on institutions. But there is this new, very large but long term new growth avenue for our business, which we refer to as the individual investor. That's your retail and high net worth investor, that's your annuity and insurance policyholder, that's your 401k and retiree market here in the United States. That market is actually bigger. The individual market is actually bigger than the institutional market today. And it has almost zero penetrations from alternatives. And therefore the ability to take that disciplined investing approach that we've delivered to institutional investors for the last 20 years. Keep doing that over the next 20 or 25 years. But also find ways to deliver that same approach that gives you those strong returns at a consistency and scale. Deliver it to the individual market. If we do that, we should be able to replicate, if not exceed, the growth profile of the last two decades.

A (68:30)

One thing that strikes me as super interesting around retail is a lot of retail investment. If we take S&P 500 ETF, for example, a lot of growth in that is you're capturing companies coming in and you're riding that wave up. You might not be able to identify them in advance, but you get all that growth. And now for possibly the first time in history, we have these incredibly large companies that grow outside of retail access. And I'm talking about like SpaceX or OpenAI. And you've created. Or Stripe would be another example. You've created 100 billion a trillion dollars of, we'll say value, we'll use that term a little loosely, but you've created that. And now retail hasn't captured any of that when traditionally they would have been in the S&P 500 and rode that up.

B (69:20)

There's absolutely that dynamic. But there's another one as well, which is in today's public market where index inclusion is such a big driver of demand. We're increasingly seeing larger companies do really, really well in the public markets. But companies that for whatever reason can't get index inclusion struggle more in public markets. And as a result, Your S&P 500 is increasingly a large or super large cap index where so many businesses around the world, in fact the majority of businesses around the world are, I would say, medium to large size. But it's actually increasingly difficult to get exposure to those types of businesses in the public markets. And therefore what. What we think alternatives can do as part of a appropriately mixed and diversified portfolio is just ensuring that those individual investors can get exposure to the breadth of the market that they want to and different asset classes or sizes of companies. That maybe is tough to do if you're simply looking at public equities.

A (70:34)

Take me behind the scenes of Oaktree. What happened? How did that acquisition come about? How was the internal process around it? I want to hear the story.

B (70:44)

So within Brookfield, there are lots of individuals who are very good at generating ideas. And what's great is we have 1300 investment professionals to filter through those ideas. And I will tell you, quite early in my career, I was very fortunate. We spoke earlier about having very Good fortune. I was asked to look at another alternative asset manager. This is 13 years ago, and this manager had run into some stumbles and some hard times and was in need of some capital. And what's funny is, I'll tell you, this was probably my first or second year at Brookfield. I really struggled to understand the right way to underwrite and figure out this business. And then one day, the light bulb went on. I said, well, if I can understand how Brookfield works, I can probably understand how this business works. And it was very fortunate early in my career to have the opportunity to really understand how was Brookfield growing? Where was it making money? Where was it seeing the greatest growth trajectory and the greatest value creation? Because of that initial process, we've just began to track the other large alternative asset managers and how we were doing relative to them, how we were trading, how we were growing, et cetera. And one of those other managers at the time was Oaktree. And I remember in beginning of 2018, we felt Oaktree was this amazing business that wasn't fully appreciated in the public markets because it was very countercyclical. It performed really well when markets went down, but its growth and its profits maybe began to plateau off when markets got really strong. Given its leadership and opportunistic credit, especially back then, opportunistic credit was a very large component of their business. It's broadened out a lot since then. I remember at the beginning of 2018, going to Bruce and saying, this company looks very undervalued. And he gave me one very simple piece of feedback which was, you're right, it looks undervalued. But what would be amazing is, could we do something strategic with them? They're incredible. Market leading in credit, which is an area that we didn't have a lot of exposure at the time. Is there something strategic we could do with that organization? And we took that away into our little lab and came up with this idea of essentially buying out the public and partnering with the founders and senior management of Oaktree. And we presented that idea to them in the latter part of 2018 and did a transaction in the early part of 2019.

A (73:41)

It's so interesting because public markets have basically, with the exception of the COVID dip for a little bit there, they've gone up and up since then. So the counter. Cyclical. Cyclical, yeah. They haven't really had a down market in order to give that benefit that you sort of are betting on. How do you think about it?

B (74:04)

Well, this is where that organization is exceptional in really Two ways. One, they've broadened their product offering the same way we've broadened at Brookfield. Oaktree's done an incredible broadening their business. They have incredible performing credit strategies as well as they've found some niche areas of the market, certain asset classes, certain securities where they are unique and can consistently outperform. That's point one. But two, within their opportunistic credit strategies, they do an exceptional job of constantly being ready when those market opportunities do exist. So I'll give the example. We made the initial investment, the initial partnership in 2019. They were incredibly active during COVID The business took an incredible step change that wasn't a particularly long period of market downturn, but it was that brief, almost cyclical opportunity for them to drive a step change of growth in their business. And they did it very, very well.

A (75:17)

I want to come back to working hard again for a second. There's something I meant to ask as a follow up there, which is you give 100%, 100% of the time, then you had kids. Talk to me about that and how you harmonize between work and life.

B (75:32)

There's two things that come to mind when you hear that question. One is there's two things that matter to me in life more than anything else and they're miles ahead of third place. One is my family and two is Brookfield. And that's where I spend 150% of my capacity. Now, let's be clear. I have great friends and we get out and have a good time. But really my priorities 99 times out of 100 are my family and Brookfield. One thing that being very honest and transparent, we have a young family. We're fortunate to have a very great and amazing young family. I remember when we were thinking of starting our family and I don't know if I'm crazy to say this, but you question how am I going to have time and will I still have the ability to care as much as about the job, which was very important to me after we start our family. And there's two conclusions and I'm not sure if everyone goes through this learning process. One is there is no limit in the capacity about how much you can care about things. I care more about my family than I could have ever imagined. I don't think I care any different about Brookfield than I did before and after we started our family. And then secondly, you do find ways to become more efficient. Obviously, time with the family is incredibly important to me. Other stuff did fall off the plate, but what's funny is you don't miss it. You find stuff that you were spending time on, but when it's gone, you don't miss it because it's been replaced by something you value so much more.

A (77:26)

It's a forcing function for prioritization, the

B (77:29)

best forcing function in the world. Because I felt like there was no space, I felt like there was no time. And now we have this amazing young family that I'll go to incredible lengths to make time for, and it doesn't feel like I had to give up anything on the work front. But some things fell away that I don't even really couldn't tell you what

E (77:52)

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A (79:12)

How do you allocate your time? And I mean this specifically in the how do I bring outside information to my life? How do I what do you read? What is the stuff that you consume? And then how do you allocate your time at work? Are there certain priorities that get more or less?

B (79:28)

It's interesting. I read a lot at work. I'm a big believer. If someone in the organization emails or sends a deck to be discussed, you read it before you start that conversation. That's it. It leads to a more informed conversation. You can think more thoughtfully reading it to yourself than you can trying to read and listen at the same time. So I like to read almost everything that's been sent and when at all possible. I like to read it ahead of a discussion. I also read a lot of news. Sometimes people say what's the last book you've read? I'll tell you. I don't have a lot of time for reading pleasure books but I do read a lot of content about our business or news about the themes that we invest in.

A (80:23)

What does that give you? Is it organized for you by somebody else? Is it like you're scanning the newspapers every day and what do you get out of that?

B (80:30)

Yeah, it's an interesting question. One thing I do quite enjoy is getting almost a daily update in different services. Do it for different asset classes. These are the 15 relevant headlines in infrastructure and you read the headlines and maybe you click on one of them to get more information. But just reading the 15 headlines gives you a little bit of a sense or a pulse of the direction of travel. But if there's one that's more relevant or more interesting, you do a little bit of a deeper dive on that. I certainly don't sit there and you know read publication XYZ cover to cover every morning. Different people have a different approach. I don't think do that.

A (81:14)

I understand what deal's been the most fun for you to work on.

B (81:19)

There's been so many I and I don't. I think you're supposed to love all your children equally. I, I don't. I think it would be very tough to pick one some that stick out. One of the very first deals I was fortunate to to be part of the deal team. We made a very small cold storage business investment in Canada early in my time in private equity. It was a small business. It was a great business. It was underperforming when we bought it. It turned out to be a fantastic investment. This is not diminishing the incredible work that was put in. It was a somewhat simple business in what the value drivers were. So it was a nice one to really learn on. It was nice because it was a good one to learn on and it was successful. So in hindsight it, it, you know I, I reflect very positively on it. Some of our first investments right after moving to Europe when we were trying to build out that, that European power business. Those I remember being really fun because we were somewhat of a, a, a young, almost scrappy team trying to build something from scratch. But in hindsight we, we did a few very good deals and that were quite foundational to what we were doing. Fortunate to build over the next six, eight, ten years and then some of the big deals Westinghouse Oaktree those have been fun because of their scarcity, their size, the broader impact they've had on the organization. So it'd be tough to pick one

A (82:53)

when are you happiest at work?

B (82:55)

Great question. I would not say I am happiness happiest when everything is going perfectly. It's almost one of those things where you want to have enough on the go that you feel a little bit stretched. One of the things I really like about this job, and sorry if this is a tangent, is I used to play a lot of sports and one of the things I love about this job is the competitiveness of it and therefore I like that exercise of trying to figure out the next thing or improving something that is imperfect or if target is X, try and do X +1. I'm not happiest when everything is perfect and under control. It feels good when we feel like we're within our culture of discipline and methodical, but we feel like we're trying to continuously grow and continuously improve and we're really pushing to do that.

A (84:00)

A lot of people I interview say they're best in a crisis and I'm curious as to why you think that would be true. Why are some people better in a crisis than others? And can you predict who in your organization is going to be good in a crisis or does a crisis have to happen and what would be the indicators of that?

B (84:18)

I do think you could predict it. There is an incredible positive attribute in being able to digest information somewhat unemotionally and make the best decision at that point in time. Earlier in the conversation I mentioned that the organization is very balanced, very measured and very forward looking. I always like when things move and generally when you're making this reference, it's when markets move negatively. They're some of the most incredible conversations we have as a business and one thing that always shocked me is we don't spend the first 30 minutes of a 60 minute conversation discussing the negative impact on what we have. We spend all 60 minutes saying one how can we mitigate, protect, ensure that the value of what we have is preserved? But then how can we look to capitalize or capture on the opportunities that this crisis or this downturn may have created?

A (85:31)

This has been an amazing conversation. I want to thank you for your time today.

B (85:35)

Well, thank you for having us.