He helped to build out Blackstones PE business in Europe in 2001, moving to London in 2001. BARATTA: Yeah. Disclosures So I think thats kind of the realm were in. I think a big chunk of what we do over our history has been taking companies private and doing corporate carve-outs from public company, so non-core assets that a large company is divesting, family-owned businesses. You had the Russia . You got to get it elsewhere. The modern day striker has to be many things to make it to the top. Theyre predicated on buying a good business, doing something to make it grow more quickly, and having an attractive exit when we come to sell it, which means it has to be a good business. He is also a member of the Board of Trustees of Georgetown University; is a trustee of the Tate Foundation; serves on the board of Year Up, an organization focused on youth employment. And so I didnt know, you know, what finance was all about. You can stream and download our full conversation, including any podcast extras, iTunes, Spotify, Stitcher, Google, Bloomberg, and Omny. And I think people just need to relax, take a deep breath. You can see the complete history of Mr. Baratta stock trades at the bottom of the page. We actually have assets where those are going in, or were investing in components that are part of . Blackstone was right on their heels back then. The other one I love is White Lotus, which is fantastic, not a Black Swan-related thing, also awesome. The most recent stock trade was executed by Joseph Baratta on 1 April 2023, trading 85,000 units of BX stock currently worth $7,337,200. RITHOLTZ: How did you first get involved with them? Joe Baratta, welcome to Bloomberg. When Baratta led private equity giant Blackstone Group's 102 million ($136 million) deal to buy Merlin Entertainments in 2005, the U.K. theme park group was best known for the macabre London. Speaking on. I started at Blackstone in July of 98, and I guess what was going on that year, you had like a Southeast Asian currency crisis. BARATTA: I mean, theres no question that financing costs are higher, both debt and equity, which is a healthy thing because I think the global cost of capital was too low, induced by super low rates and capital allocation to riskier assets, institutional investors chasing return. What is . BARATTA: Yeah. BARATTA: No, no. From Strength to Strength: Finding Success, Happiness, and Deep Purpose in the Second Half of Life by Arthur C. Brooks. RITHOLTZ: And you had mentioned private credit before, that seems to have been a giant growth area, especially when rates were at zero, when people arent seeing a whole lot of returns from fixed income. In addition, he makes $0 as Global Head of Private Equity and Director of the Company at Blackstone Inc. Joseph has made over 11 trades of the Blackstone Inc stock since 2020, according to the Form 4 filled with the SEC. And now, the rate of change is much more quick with the advent of technology, ubiquitous broadband, which really enabled the internet, changed the way we . So I said, well, what kind of deals worked in the U.S. in the early 90s, in my experience? BARATTA: And so, as we were watching the Feds reaction to the financial crisis, pushing rates down and keeping them down, were like, geez, this probably is not going to last forever, and that doesnt seem to be the natural state of affairs. What are you looking at that might not have been on the table a decade ago? The music is great. I liked it, I thought I could build a successful career. I think Id been to London Im not even sure Id been to London. BARATTA: Patience. RITHOLTZ: I can imagine. BARATTA: We leaned into exiting what we could in that period. Mr. Baratta also worked at Morgan Stanley in its mergers and acquisitions department. The private equity firm has hired Droga5 Chief Strategy Officer Jonny Bauer as head of brand transformation for its portfolio group of more than 200 companies. I got an analyst job at Morgan Stanley in the M&A group, and thats kind of two-year training program and I did that and that was painful. Barry Ritholtz. And the way buyouts are being financed is evolving away from syndicated big syndicated capital structures committed to by banks to now the people who are actually going to hold the risk, firms like ours and Apollo and Ares and others, who are actually lending money directly to the people who are borrowing, instead of going through the banking intermediaries. And the cost of financing and the quantum isnt the biggest driver of our returns. Sometimes we buy things from our competitors, particularly if we think we can make them a lot bigger through acquisition or other things. Well, if you do this if youve been doing this long enough, which fortunately, I have, since really 1095, you see different cycles, and you see what happens when capital becomes cheap and money becomes easy, and interest rates are lower, not really a factor. And for a while, it looked like the lower quality the stock was, the better it did. BARATTA: I had agreed to go before September 11th happened. RITHOLTZ: Makes a lot of sense. It has to be useful if you have skills. ANNOUNCER: This is Masters in Business with Barry Ritholtz on Bloomberg Radio. Do you have the same phenomenon in the private market? Off-duty: Blackstone's Joe Baratta on gravel biking, Cloud Cuckoo Land and the Dallas Cowboys Baratta's shares his New Year's resolution, books he's reading and high and low career moments, as well as his fantasy management role in the NFL. You end up in London. I mean, you have a bunch of companies that have trillion dollar-plus market caps. Not to say like we executed on that vision perfectly, I mean, we would have made some mistakes, but we definitely became much more cautious when the bull market really ramped up, in particular, post COVID, when not only did you have the low rates which the Fed double down on, you had this huge transfer payment from the federal government . Whats an attractive place that people probably overlooked? You go to D.C. You go to New York. BARATTA: Well., they definitely did that. BARATTA: looking at the divestiture from Vivendi. Were seeing full employment. And so, were trying to find the businesses that are going to be enabled and benefited by AI, and avoid the things that are going to be dislocated. So we operate from a board level and really focus on key strategic and risk management variables. BARATTA: I think private market valuations are driven to a large degree by whats going on in the public markets. Big software companies including Microsoft and Salesforce are racing to incorporate the technology behind ChatGPT, known as generative artificial intelligence, into their products to attract new users and boost profits. There was a big consolidation and lots of divestitures of pubs that were owned by brewers in the time, and there were rules came down that brewers can own distributors. How often does a new business model come along thats really notably different from what preceded it? Receive a summary of the day's top tech newsdistilled into one email. BARATTA: Yeah. So we kind of went on, did some missionary work, meeting the local private equity firms in France and, of course, in the U.K., in Germany, up in the Nordic region, in Italy, and we just met all the other players. The transcript from this weeks, MiB: Joe Barratta, Blackstones Global Head of Private Equity, is below. RITHOLTZ: So I really liked the first season. So we did a lot of these sorts of consolidation place. What was it like on the private side at the end in the 90s? BARATTA: Exactly. BARATTA: I think it was 2005, when we started to look at in China and in India, in particular, and also Japan. And, yes, if Jerry needs some help, you know, he knows who to call. But I dont think were going to go back to the days of 2019 to 2021. Ive been a Dallas Cowboys fan since Im 7 years old. Id never lived abroad. The whole aesthetic of it is amazing. You know, we spent a lot of time looking at traditional media businesses that linear TV, satellite broadcast, regional sports networks, all these things, that the direction of travel isnt really investable, the streaming services, direct to consumer. * * * * * A special committee of messaging app IRLs board of directors suspended CEO Abraham Shafi on Friday after receiving a report from outside counsel that outlined a pattern of misconduct by Shafi, an IRL spokesperson told The Information. Switchboard: +1 (212) 583-5000. You can stream and download our full conversation, including any podcast extras, iTunes, Spotify, YouTube, Stitcher, Google, Bloomberg, and Omny. But I could have evolved more quickly as an investor, you know, over time, and I continue to learn that lesson. It is a rapidly growing economy, with a highly educated workforce, that with supply chain dynamics now moving toward Southeast Asia and India. Im assuming that all these different names all come from different work products, different strategies, different funds, or is just everybody getting this wrong? You know, people knew who we were. RITHOLTZ: in The Atlantic. I was 29. BARATTA: Yeah. Blackstone's Buyout Head Is Eyeing Public Companies Joseph Baratta. I mean, his family dates back to like Louis Quatorze. joe baratta blackstone compensation So I think the large end of the market we think is the most attractive. RITHOLTZ: Well, so far, youre pretty interesting. And so, yeah, it was helpful. Happy to be here. BARATTA: I go to California all the time. Is there a ceiling, or at what point you look at something and say, hey, thats just too big to try and take a bite on? RITHOLTZ: At what point does size become the enemy? I would be remiss if I did not thank the fine team who help put this conversation together each week. BARATTA: Yeah. RITHOLTZ: So how much of this is a function of a trend we sort of began in the 1990s? You know, energy prices are higher. BARATTA: and nice calling card. Who cares about brown shoes? RITHOLTZ: Who, by the way, we were supposed to have on the show, and a little thing called COVID came along and interrupted us, like, literally, that end of March, beginning of April, when his book came out . We find great management teams. In this podcast, Joe and Peter discuss Blackstone's history building Merlin into a global leader, and our long-term investment plans to help the company continue to expand. I mean, inflation is higher than normal, but thats going to come down. BARATTA: A growing economy, zero cost to capital, markets compounding at 15, 16, 17 percent. RITHOLTZ: So before we let you go, were going to jump to our favorite questions that we ask all of our guests, starting with you mentioned streaming, tell us what youve been watching, what keeps the family entertained? The estimated Net Worth of Joseph Baratta is at least $181 Million dollars as of 1 April 2023.
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