It’s not hard to imagine. There’s Larry Fink, Starbucks coffee in hand, heading down Park Avenue. And there’s Stephen Schwarzman, his old boss, heading up.
It’s not hard because Fink and Schwarzman — two of the most successful financial whizzes of our time — have been on a collision course for years. They work, literally and figuratively, on the opposite sides of the same street, personifying a contest that’s remaking money management.
On one side is Fink, power player in low-cost passive investments. On the other is Schwarzman, old-school dealmaker and champion of high-touch, high-fee alternative investments like private equity.
The broad outlines of their twin careers are by now well-known. First came the years together at Schwarzman’s Blackstone Group LP, where the young Fink added a bond shop to the striving buyout operation. Then, the inevitable split. Fink got what was then the underdog: BlackRock Inc.
It’s no underdog now. Lately, the investment world has been tilting BlackRock’s way. Today the firm sits atop $6.3 trillion in assets, making it the world’s largest money manager and one that dominates the market in passive-investments.
Its sheer size and diversity helped protect it amid 2018’s choppy markets. Last week’s first quarter results beat estimates even as traders devoted less cash to its exchange-traded funds. The firm attracted long-term net inflows of $55 billion and revenue grew 16 percent year-over-year.
Fink’s personal fortune, meantime, has at last eclipsed $1 billion, according to the Bloomberg Billionaires Index. His holding in BlackRock is valued at $570 million with dividends, stock sales and compensation — $27.7 million in 2017 — making up the rest.
“Fink is up there with names like Jamie Dimon and Warren Buffett,” says Kyle Sanders, an analyst at Edwards Jones & Co. “You have to look at Larry when you think of asset management.”
Blackstone, by contrast, oversees $434 billion. And nowadays, private-equity types are chasing deals despite lofty valuations and rising interest rates. Not that Schwarzman is hurting. He crossed the billionaire mark years ago and is now worth about $12 billion, according to the Bloomberg ranking.