Kewsong Lee discusses taking the helm at The Carlyle Group, his vision for the future of the business and the challenges and opportunities of investing in a shifting macroeconomic landscape.
On the changing private equity landscape: “It started out as private equity, but we’re very much in the private capital/ private markets business. And one of the greatest things that’s happening… is you’re going to continue to see the growth and evolution of the role and importance of private markets, often displacing public markets… which I think is one really important thing happening in the industry.”
On how the macroeconomic environment is shaping investments: “The most important thing probably in the private equity business is to appreciate that you cannot rely on growth for returns. You have to drive operational improvement and value creation. At Carlyle, 70% of returns are generated not by multiple expansion, not by deleveraging, but by fundamental blocking and tackling. How do we make these businesses better? The firms that can figure that out are the firms that are going to continue to drive great returns.”
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