Connor Teskey: The 90% Rule, AI Infrastructure, and the Future of Investing

**Shane Parrish** (0:03)
Why don't we start with the State of the Union for Brookfield? You guys manage about a trillion dollars. Where is it allocated and how is it allocated?

**Connor Teskey** (0:12)
So our business today is really built around raising capital from the largest pools of money around the world and then turning around and deploying that capital into the largest and most attractive investment themes around the world. As a result, we are a very global business. We raise money all over the world and then equally we deploy it into 60 of the biggest countries and markets. Undoubtedly, our biggest markets continue to be the United States and Western Europe, but we are truly a global business today with operations across Asia Pack, India, the Middle East and South America as well.

**Shane Parrish** (0:57)
When I spoke to Bruce last, he mentioned that he wanted the next generation to be better than him. I'm curious, what have you learned that's non-obvious working with him?

**Connor Teskey** (1:09)
That's a pretty high bar to exceed. I think what Bruce has built is amazing and quite frankly, underappreciated. In particular, not only the investment platform and the asset base, but equally the culture. And I think it's that culture that will ensure that we can keep growing and keep building the way Bruce and other members of senior management have built up the firm for the last two plus decades. In terms of some of the things that Bruce has done, and not just Bruce, but Bruce and other members of senior management is they're incredibly balanced when there are big moves in the market. They're very measured in terms of how they respond and how they think through changing dynamics.
Secondly, I would say very forward looking. We learn a lot from the past, but we don't spend a lot of time dwelling on it, if I can say it that way. And then, you know, that importance of culture, the scale of what has been built, and often why I feel it's so underappreciated, is because one of the big cultural aspects of Brookfield is almost worry about putting others in a position to succeed more than yourself. And Bruce certainly embodies that, as do others, and therefore, I don't think they always get the credit for what they've built. But we're very fortunate now to have this exceptional platform that is on the absolute front of some of the largest, most enduring and most attractive investment themes that have been running for three or four or five years and are going to continue to run for one or two decades going forward.

**Shane Parrish** (3:06)
Where would you say you're different from him?

**Connor Teskey** (3:08)
There's no question.
He's been doing it for 20 years longer than I have. In a lot of ways, I think we've found each other to be very complimentary. The job is, of course, we run a very large investment organization, and therefore, the most important thing we do is deploy capital at exceptional returns. That is the bedrock, that is the foundation of our business. That is always what we're going to be known for. But in order to do that at an increasing scale and over a long duration of time, you have to be better at so many other things as well. You have to be very good at building teams. You have to be very good at communicating strategy, communicating and interacting with your clients, your LP partners, your counter parties. It's that breadth beyond just the investment role. I've been very fortunate to watch how Bruce excels in all of that, and hopefully absorb some of it over the last 12 plus years of working together.

**Shane Parrish** (4:15)
Has the nature of how you invest changed? I mean in the sense of, it seems like we've gone from a traditional LP structure, this seems to be a lot more co-invest now, and there's different products available.

**Connor Teskey** (4:27)
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 or 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, you know, probably two-thirds, 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. 20 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, well, 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.