Alex Wright: Partner and Global Wealth Strategist at Apollo

Luke Hyde-Smith (0:02)

Welcome back to the W1M Why Invest podcast with me, Luke Hyde-Smith. And today, we're delighted to be joined by Alex Wright, partner and global wealth strategist at Apollo, one of the leading private market investment firms. Previously, Alex was portfolio manager for Apollo's closed end funds, CLOs and private BDCs, and we'll get on to Alex to explain precisely what those acronyms are over the course of our conversation. Prior to joining Apollo, he was CSC group, where he served as variety of roles, but most recently as CFO and head of US corporate debt. And prior to that, Alex was with IBJ, Whitehall Bank and Trust Corporation, and the Chemical Banking Corporation. Having earned an MBA from Fordham University, Alex now serves on the University President's Council, and is chairman of the Fordham Gabelli School of Business Alternative Investment Council.

So, Alex, it is a great pleasure having you on the podcast today. Thank you very much for taking the time.

Alex Wright (1:04)

I'm so pleased to be invited and we're really looking forward to the conversation today.

Luke Hyde-Smith (1:08)

Yeah, yeah, us too. So, look, before we get into some of those acronyms and the inner workings of the private debt market, could you give an overview of Apollo as a business and how it has evolved since you joined back in 2011?

Alex Wright (1:21)

Sure, happy to do so. I'll even take you back a little further to the founding of the business, which was 1990 So, we've been at this now a good 36 years, or as we like to say, almost four decades. The founders came out of Drexel. They immediately got investment capital to pursue, to stress for control, private equity investing. The business has grown exponentially since that point in time. We're now managing north of a trillion dollars of investor capital. When I joined 16 years ago in 2011, we were just 45 billion.

So, the growth from that point forward really has been manyfold. Largely the credit business. So private credit, we're the largest manager at 850 billion at this juncture. Private equity is still a cornerstone of the business and real assets, real estate infrastructure and otherwise.

One material component though gets to the alignment of our capital with the investor capital, Athene. So, Athene is the largest fixed annuity retirement services business in North America. That was started, if you can believe it, with just $18 million of partner capital many years ago. Today, it's north of $400 billion investment grade regulated balance sheet, in which we anchor our deals and our funds with our own money. So, we underwrite all of those types of activities through the lens of a principal investor, not just an asset manager in isolation.

Luke Hyde-Smith (2:48)

And that Athene business, is that owned by Apollo? Is that standalone business?

Alex Wright (2:53)

So, great question. Interestingly enough, we founded it as a separate company. We grew it to size and scale and actually it was taken public on its own.

Several years back, we actually merged it back into Apollo. And so now, Apollo, which is publicly traded in the S&P 500, houses the asset management business and Athene as one global company.

Luke Hyde-Smith (3:16)

Okay. And over the time, 2011 through to now, I think if I got the numbers right, you just went 50 or a billion to a trillion. That was the number of people at the business. How does that look?

Alex Wright (3:27)

Oh, that's an interesting question. I think back when I joined, it was measured in a handful of 100

Luke Hyde-Smith (3:33)

Yeah.

Alex Wright (3:33)

200, 300 Now, we're probably pushing upwards to 4,000. Yeah. Also diversified across geographies in a material way.

When I joined, of course, we had our operations here in the UK, largely in New York and so forth, but now we're diversified across almost all continents, if you will.

Luke Hyde-Smith (3:51)

Rumored, if not confirmed, to be looking at a new HQ in the US or co-HQ?

Alex Wright (3:56)

Yes. Yes. I do believe that's out in the press.

Austin, Texas, which really is going to be an innovation hub for us, and the selection of Austin was very front-footed in that way, where we're going to be very tech savvy. We'll build teams down there and hopefully innovate, make businesses more efficient, embrace AI and other technologies to take the business to the next level.

Luke Hyde-Smith (4:20)

Yeah. Very interesting. We're going to get into Apollo in the business and the culture, because you've always been a first mover and you set the precedent in the space. But let's get into the opportunity set and the business for our listeners, because you're a private market business overall, but as you said, pedigree in the credit side of things. Could you describe the various asset classes in private markets, and then perhaps talk about some of those specifics in the debt space? I mentioned you were an expert in previous career in CLOs and private BDCs. What does that mean? Yeah.