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Building Blackstone, Backing Costco, and Working with Munger | Tony James on The a16z Show
12 segments available
David Haber speaks to Tony James, former President and COO of Blackstone, about what it takes to build enduring investment franchises across five decades on Wall Street.They discuss how DLJ used principal capital to outflank better-capitalized rivals in private equity, the lessons from backing Jim Sinegal at Costco's Series A and serving alongside Charlie Munger for 30 years, and how scaled to new heights through retail distribution, disciplined acquisitions, and a succession plan built to preserve momentum. Timestamps: 00:00 - Trailer 00:45 - Starting at DLJ: Getting in on the Ground Floor 03:05 - The LBO Revolution & Building a Merchant Bank 09:09 - Leading the Series A into Costco & Lessons from Jim Sinegal 15:00 - 38 Years on the Costco Board & Learning from Charlie Munger 25:17 - Joining Blackstone: The Partnership with Steve Schwarzman 33:44 - Blackstone's journey from $14B to nearly $1 Trillion 44:09 - Investment Committee Culture & the Art of Robust Debate 53:41 - The IPO, Retail Distribution & Building Competitive Moats 01:05:39 - Succession Planning & Knowing When to Step Away 01:10:00 - The Future of Private Markets 01:15:24 - Advice for Young People Resources: Follow David Haber on X: https://twitter.com/dhaber Stay Updated: If you enjoyed this episode, be sure to like, subscribe, and share with your friends! Find a16z on X: https://twitter.com/a16z Find a16z on LinkedIn: https://www.linkedin.com/company/a16z Listen to the a16z Podcast on Spotify: https://open.spotify.com/show/5bC65RDvs3oxnLyqqvkUYX Listen to the a16z Podcast on Apple Podcasts: https://podcasts.apple.com/us/podcast/a16z-podcast/id842818711 Follow our host: https://x.com/eriktorenberg Please note that the content here is for informational purposes only; should NOT be taken as legal, business, tax, or investment advice or be used to evaluate any investment or security; and is not directed at any investors or potential investors in any a16z fund. a16z and its affiliates may maintain investments in the companies discussed. For more details please see http://a16z.com/disclosures.
Segments Timeline
Trailer
"If you think about the development of a successful company, there's kind of an S-curve. It starts off small and entrepreneurial. Then there's this kind of escalation where you create a lot of value an..."
Starting at DLJ: Getting in on the Ground Floor
">> Tony, thank you so much for being here. >> You're very welcome, David. >> You joined uh DJ as an investment banking associate in 1975. I think just after business school. Maybe give us a reminder o..."
The LBO Revolution & Building a Merchant Bank
">> The big turning point I would say was 1980 when KKR did a LBO for Hudai Industries, >> the first big public company that went actually was taken private. And I thought, wow, you can buy these huge ..."
Leading the Series A into Costco & Lessons from Jim Sinegal
">> totally and that that has definitely shined through in a a lot of my conversations. Um yeah I mean maybe just kind of talk through the inception of the of the merchant banking you know kind of fals..."
38 Years on the Costco Board & Learning from Charlie Munger
"One of my favorite fun facts uh about your time at DLJ and you know we're sitting in a venture capital office was that you you led the series A into Costco >> in the 1980s. Uh >> I have to hear more a..."
Joining Blackstone: The Partnership with Steve Schwarzman
">> I mean, that is remarkable. So, I want to transition to Blackstone, which I think, you know, most people know you for because you had such a huge impact on the growth of that business. um you know ..."
Blackstone's journey from $14B to nearly $1 Trillion
">> Totally. Um, you know, people know Blackstone today. You know, a trillion dollars in AUM. It did not look anything like that when you joined in 2002. >> I think the firm was maybe $14 billion in to..."
Investment Committee Culture & the Art of Robust Debate
">> But that's that's kind of what you have. You know, you're you're you're more than just a referee, but I really felt strongly that it's a collective decision. >> So when I put my finger on the scale..."
The IPO, Retail Distribution & Building Competitive Moats
">> Totally. I want to talk about the IPO because it was, you know, uh obviously a huge deal in the kind of history of the firm. Also, I imagine very complicated both kind of tactically but even cultur..."
Succession Planning & Knowing When to Step Away
">> one of the things that I think is is rare to see is that my understanding is when you first had that conversation with Steve, you basically told him you were going to retire at 70, >> right? >> Um ..."
The Future of Private Markets
"sitting here amidst, I don't know, fear-mongering and private credit, the SAS apocalypse, right? I don't know where where is this all going like how how do you sort of view the maybe private markets l..."
Advice for Young People
">> Totally. You mentioned you had, you know, lots of interests outside of, you know, Blackstone, Costco, and DJ. I know, um, you know, one of the things that you, uh, you know, have been passionate ab..."