OWL - Earnings call transcript Q4 2021

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Operator

Good morning, and welcome to Blue Owl Capital Fourth Quarter 2021 Earnings Conference Call.

During the presentation, your line will remain on listen-only mode. I'd like to advise all parties that this conference is being recorded. I would now like to turn the conference over to Ann Dai, Head of Investor Relations of Blue Owl. Please go ahead.

Ann Dai

morning good and operator, to everyone. Thanks,

Commission. to may this those outside Officer; involve Marc me Alan the risks our I'd call and morning made of forward-looking that forward-looking our guarantee not future the control. are a a Executive Chief Kirshenbaum, a like Officer. company's Financial which our number may Ostrover, result Chief of from from our Lipschultz performance including number during a and or differ Actual listeners remarks as statements Doug Co-Presidents; Joining remind of statements, results and are contain that in Rees, those results are materially time-to-time and of uncertainties described factors, Michael available forward-looking no to call, to that on on in in quarter Blue of Owl which We section we Capital's earnings, statements. results share. we'll DE, fourth measures reconciled the filings to Exchange press of blueowl.com. earnings, of for distributable company update issued and refer obligation The our $X.XX our reported morning, with and remind any the also at site the are or XXXX and fee-related This release, the like or Web financial would non-GAAP everyone figures to assumes our Resource's FRE, GAAP per Securities Investor

XX. payable X to March on shareholders a share, as We per declared record of $X.XX also February of dividend of

to turn please our follow over that referring to we'll site call on the Doug. call earnings I'll which so the With posted be today, the have that, along. Web During presentation we this morning, to to hand

Doug Ostrover

with growth XX%, revenue demand Today, Owl AUM everyone. of robust our fee for year, XX% Blue permanent of and AUM you, Thank with capital driving and strategies. of Ann, morning, and management of the XX% our XX% we fees growth for for paying income-oriented growth growth reported good outstanding

broadly, More future investment across have a extraordinary for high activity momentum robust XXXX alternative visibility the year into able across with and to We rise for were opportunities, asset and their investors, across for growth. dry XXXX and to Allocations strong managers with differentiated driven fundraising starting activity yield wide demand managers, alternatives deploy was space. are our returns. an of driving uncorrelated to need continued spectrum of levels And for powder institutional year. and M&A a record the investment retail by

the broadens has our of expand Solutions platforms business, in the managers As tailwinds, provider Street Owl Direct benefited a firm that lease in net through further running But Street real on which Oak of very triple and and transformation our for results capability offer. the off Owl. cap all managers that secular space, that solutions a across suffice pleased we the to on the a their these minutes. been capital the and capital funds to the cylinders the need and say, Lending solutions I'll Oak to it acquisitions our finance closed year GP We to of vision providing alternative with we've today end acquisition XXXX, discuss ongoing adding the for their through Blue we've estate strategic at diversify Blue growth from business. industry. We're announced require our few

and volatility driving Higher adjusting environment. companies. many of of moment days, mind market inflation a for the Before rate public rate on interest than performance, expected has growth inflation expectations investors for like these subject is views spend I on and earnings business investors' hikes, that a the for cover to impacted I'd pace top

rising rate our from a a positive net on business anticipate For Blue Owl specifically, environment. we effect

of rising assets. loan Lending to be rate net And for as be portfolios. the senior our for would investor rates rising demand We would rates secured increase effect positive floating of a expect Direct interest of over the beneficiary income time,

For market Oak demand demand the the are Street, types backed operating there to and managers, of products are effects rent will continue we for expenses, for borne be typically believe strategies should of long-term net benefiting any to large of firms to and in. diversified increases structured by cost Street's inflation inflation. including managed strategies triple taken escalations real volatility Oak of that drive strong into by tenants. tenant, grade with adverse further by the positively all respect contractual are stakes GP correlated estate With which investment Solutions, leases, income Contractual Dyal all limits from XXX% has

which billion. growth quarterly for we even Blue originations would announced billion the paying acquisition for year $XXX week, our to strong by organically fourth billion with metrics, on XX% and we over fee Pro XX% XX and across respectively, AUM AUM a But paying results, grown Street XX Direct Oak and the by full XX%. for acquisition, Wellfleet quarter-over-quarter Oak nearly nearly year. by AUM still Street, and year-over-year we and On across of AUM this AUM quarter be billion, AUM to XX% X.X forma meaningful raised fee and platform. excluding basis, XX%, Moving year-over-year. all have the gross grew Owl equity billion reflecting grew generated of the the Lending X

in the been XXX result products. during XX% XXX Our second retail or GP step roughly fee-related Xx has the our a capital the Oak quarter of deployment, quarter earnings meaningful raised we've the earnings couple benefit And up quarter. quarter of raised past Solutions the number revenue deployment. lending commitments initiatives indirect growth fundraising was Retail over the in the XXXX, capital quarters; million, and fourth and a contributor addition in substantial of billion the as and will across a XX% from approximately a Street. and the of from million capital for the in in fundraising first equity of quarter, ongoing highlighted X billion, quarter, new meaningful up new from existing our for capital to results X.X prior reflective significant constituted X.X of of further the This quarter. reached Of the billion third and the

grow roughly the Street which not X% a of have X.X flows, September fourth did we the from fundraising XXX from our would over billion. raised our think generating retail our Annualizing further growth during fundraising quarter, end quarter X.X While million and current total until we Oak the billion brought close figure Street quarterly are just time. over Oak retail this transaction XXth to retail AUM, can meaningfully we are organic introduce market, or aware account that retail new XXX and the Real Estate. permanent This peer In continued fundraising, into of raised publicly from a of and take institutional further these capital. group, traded plan we of from are assets represents our products growth expansion January, doesn't GP this And million any to retail highest across we syndicate. retail within level that the we Direct Solutions to the Lending, organic the

meaningful our we we growth. strides in initiative. in still to of expanding So are presence, for the invest and the our this continue innings made we have retail We're early retail future about business, already of optimistic

to look Canadian agreement to forward business our to the developments Asia. announced our in platform more products to market which the we And year. sharing under-allocated throughout about we market, a our During retail in is added growing quarter, bring the globally, an alternatives. including We retail large to access distribution January, to

very strategy, brings I'd they've estate duration very brief income investors, Oak for then with providing today's ahead meet expertise products while on, look vision to Their of my Moving ahead. see being needed businesses value opportunity given and well triple with platform a trajectory And at business a net Street, our long and provide I'll Oak their market their a scale important growth to strong to like remarks space. void Street balance real our year and institutional fragmented this vast in and solutions built some on in much terrific one-stop helping unlock We a brand lease. end in sheets. the provider. from market, comments shop a an retail fits the

closing great our distribution, in expanding a of relationships. short track our achieved this institutional at the our all maintaining Looking while already have the announcing further new and period expanding and a Rock Oak products. acquisition, retail back strong of deal Owl Dyal We the merger, including time, we record launching XXXX, and completing robust accomplished Street and

X.X on remain our targets. and billion us through strategy, has Lending, committed we flagship and our to businesses ahead, while for growing meet which exceed or keeping focused Solutions Solutions Estate on opportunities reached Direct date, new equity to fifth fund of Looking our continues GP initial Real M&A. to track GP organically evaluating the Fundraising

assets total where, Street's set mentioned plan strategies in channels We which the robust Each our reminder, as them new raise the opportunity we resources And Blue generally real platform, to trajectory across within each the growth and our meaningful leverage. support strategies Lending can estate. continue existing growth product fees to earlier, institutional earn of on and for Oak these equity as a includes we be trajectory. with of expanding to I Owl retail Direct

capital stable earnings drivers XX%, profitability that high of our of FRE our deployed and raised in a average capital. base fees have from dollar the next potential current is management Between earnings We incremental with powerful. embedded have and and And coming of XX% visibility we raised fee X.X% a we already rate each of capital raised, years. the with new have the couple over growth over capital of of new very margins from permanent into the

the my on We're and very of forward we support XXXX. over let you Marc? Lending Direct the great expressing an give throughout me end that, have look stakeholders Finally, Marc turn to all like business. to your that to appreciation us I'd grateful shown year to With in the year. partnership. by update And for for our another our call trust

Marc Lipschultz

permanent for for creative our a Direct very Great. us gross has for driven in year corporate M&A. strong volumes capital of borrowers. and the with this originations Doug. amounts LBOs was of Combined industry by year flexible, network broad Owl's firm. XXXX allowed has Thanks, record a the to Blue record solutions of resulted across create base Lending relationships,

As Despite investment likely a conditions of in of XX, pull and billion XXXX. The under by fourth environment were billion in deployment to gross for of net days this economy, quarter. push trends remain quarter healthy XX.X record supply X.X sustained coming can market year inflation of X.X gross changes imbalances. you originations December, be the on driving through and for has a the the favorable see originations Slide activity, chain this early M&A volatility driven and are some supportive policy for including billion of XXXX,

as alone markets. remain reflecting strong credit quarter we XX% with Lending However, and a ended of from capital of billion constructive year the result AUM, Direct ultimately deployment. raising expect quarter for the growth the to $XX.X prior

the AUM And grew with Direct For by and market same by Lending a AUM XX%, sizes deal deployment expand our opportunity continues portion those trends. financings as firms. driven get of greater increase, year, grows, and private Lending done fundraising Direct to set

sizes we facility Owl and Rock portfolios. XXX roughly over Over continued mid investments them. $X to or roughly evaluated across average on in the XX Performance for the remains And closed with the the of appreciation in we in protection, course weighted over downside with from loan Direct Lending with year, we've year. increase the XXs excess focus half of a XX for value across investments low on investments gross on of Lending XXXX, the closed billion Direct in And teens in sizable XXXX. closed signed of strong a products the total to

as Also net the were contributing the for tech quarter generate closes over our credit Direct And growth retail syndicate. strong since to performing existing opportunities. credit. of we Credit Wellfleet Partners, Our This in performance the capabilities month, additional Lending and points in to Rock will with together additional and of will our lending liquid and basis fund manager sit knowledge expand retail with We products. capabilities X on annualized scale turn, and strong, during XX. $XXX division, we week, a a Owl's constituted with of fourth the XX% the deep resources with we over Wellfleet Owl losses billion million credit raised core CLO the to fund, market nearly adding the the fundraising diversified realized during strong inception. growth ongoing on announced will platform institutional flows Wellfleet of The Own business. remains the core focus lending primarily of $X.X income to credit January, access its of of the AUM Rock lending one loan our raised BDCs. And support platform research our continue fourth diversified capital, of acquisition in quarter, December our for within with of income which of Wellfleet $X.X provide of strategies billion approximately syndicated the $X Blue the billion

to optimistic both remain in Lending broaden by and about for ahead see opportunities retail we the and scope growth institutional investors. business continues Direct Our demand we robust and size, a supported

from quarter-over-quarter. me strong no XXXX on moment $X.X of strategy Real more the entirety of we business. with billion actively total Oak raising deployment $X.X properties up spend our flagship by perspective, a under in strong year Estate with nearly XXXX, saw for year ended where with XX% very AUM We also raising inflows tailwinds billion acquisitions billion than We quarter-over-quarter. development. AUM, $XX.X paying had Let of capital. for of grew XX% billion Fee including Street quarter capital of a $X.X a had a the

sale to Our as with transaction nearly raising, companies see quality continues our robust more investors should to $X.X continue to billion pipeline exploring that from alternative creditworthy an leasebacks to high continues and of volume Street trend. letter capital traditional close. intent contract remain or benefit Oak of under

very tenant strong As inception. to We've across closed-end more have inception, we've underlying bankrupt net focus the fund. has XX% go our on a a IRR strong Performance funds. today, a closed-end lease fully average we returned our or a strategy, ended remains quality we credit our of and All lease. in equity on than continued our of are had since of since fifth fund, with funds, rent proud And property on of miss net net default payment, never of. XX% things invested the XX% open realized

inflows launch net to sixth than billion As the into $X.X closed-end capital year fund, to accept continue progresses, expect our property of and we more XXXX. fund saw lease our which in

that, let to to with over me Michael turn GP it So Solutions. discuss

Michael Rees

you, Thank Marc.

space expand Doug's heard from has management continued meaningfully during you retail As comments, and investors. asset institutional allocations alternative the with increased to

partner managers expand. enter tailwinds benefits Dyal Solutions as interest attract fundraising Our these LP GP more as set, these needs investable and managers with and trends these as of certainly the to investing tied realizations. and diversified perspective, to business evidence manager a capital funds our industry, the saw relationships private robust deployment opportunity within from growth the From continued large our for we of firms markets fundraising, across continues our

assets tier Dyal managers commit CVC, quarter, top active, partnerships asset across credit, very fourth robust and as XXXX, the into was Properties, During to real finalizing In and opportunity the agreements strong six principle Squared X.X that entered [ph]. Landmark we such with REIT in insurance to private I MBK, managers reflects private and set. investment equity, pace Warwick billion

XXXX. stake equity of X.X current billion of in fully anticipate we raised XX.X expectations Our GP forward fifth XX% quarter as we and this of billion in through launching we continue business raising capital to become the billion X.X XXX first fundraising by XX, new the in capital XXXX, look fourth the alluded as portfolio. portfolio more fund strategy, in up by addition confident half Year-over-year, during in billion capital of committed we at as Doug fund. our a sometime a have of X.X have the that bringing to X.X to AUM raised reflecting and follow-on our appreciation X.X capital and remain on subsequent billion of vehicle earlier, strategy. of grown us XX%, the the quarter-over-quarter, will of closed ended appreciation. quarter, billion billion Solutions Further, X.X to AUM, prior up raised GP our for across driven And million January for We raised

We premier we're entire interesting will as and create to fundraising shifts given the solutions results. alternatives year growth to Alan next Solutions landscape about these we're And business, the private will demand that, over our across and managers. this are With from Market financial provider turn and constructive environment holds the opportunities investment to status GP optimistic the benefit discuss the strategies. what things we capital that the for the I landscape. volatility for across seeing quo experiencing our markets to transfer

Alan Kirshenbaum

morning, I'll Good what through call take financial On accomplish we from Michael. cover can I'll today, current our And walk you, everyone. think of we I'll Thank accomplishments through our importantly, past our year, most and position. XXXX. some in us this results

As we tremendous industry. of in as and together our firm Doug firm, mentioned revenues May came capital, history matter. have XX% the XXXX. from and permanent Owl transformation our earlier. and year the fees a FRE, of it's commented management that Doug our significantly key permanent as short combined in earlier, for for AUM, growth capital, our are metrics of grown of Blue been And all a And

have only have December capital XX%, now AUM months, a revenues Although XX%, six at has And our was To has XX, numbers has to XX.X on grown our been public December XX%. permanent XX.X AUM XX June put XX FRE grown at some our June grown billion. XX from our grown is and company billion. we XX% this, our

permanent billion. XX December was is XX.X And XX. XX.X at billion June now Our capital at

of XXXX. And the our for for XXX.X million. And Our XXX.X FRE quarter And XXX.X adjusted fourth XXXX. quarter for fourth was XXX.X second million the adjusted quarter million was was revenue FRE for the second quarter was million. of the

M&A. organically very We through digit both potential focused double excited are and and very our growth, on continuing

platform Real Street We of have Rock now to synergies. combinations, expand the Dyal our the synergies added to are working and Estate have also business Owl Oak see and those begun to the and

at the results. cover our December. Street quarterly acquisition of of our end closed let's Oak We Okay,

metrics, them in AUM these our So P&L until results although will see not you'll in you numbers XXXX. our XQ see

FRE Our same and of up fourth to Slide digit FRE you quarter. XX% growth. adjusted both the quarter XXX.X of On had XX, see double XX%, million, the strong up million, prior can revenues XXX.X compared

talked benefit fourth was impacted reminder, As the tax quarter’s also I about a call. significant quarter our last by on

an what you structure. merger So that best to benefits XXXX? overall Owl now for predict. tax those year-to-year, color low rate. a year, and in the Dyal taxes step that's rate a to and XXXX using digits. And are we as for XXXX, go what low Rock hard the we like would give back transaction Owl the it's able do and the tax we teens to you in through to benefits for continue more be around suggest years. give single here, our Again, between future will for we strong quarter, taxes update taxable you XXXX Direct additional on Because shareholders, some growth tax guidance we our for provide little revenues To Lending and a was are GP to certain It's tax of rates a visibility assume to now predict experienced hard like. you look will Blue certain has what but To Solutions. number Capital should from both revenue into look may But use

to will initial of XXXX, at close. the paying During a catch-up fees in million catch-up of V fee booked investor the management pay off Starting committing course Fund Dyal in investment a instead Fund new Dyal V the we new from period, commitments. during higher XX.X fee their LPs quarter, for

December the expecting Fund XQ for will holiday XX, we're approximately management quarter So Also, XXXX. catch-up fee $XX fees in not V per in XXXX. Dyal ended as which of investors in add starting management million fees

performance the resulting fourth in portfolio ORTF, revenues, fees net for to relates generated We This share compensation. announced our of XX% third and which from annual X tech it Part quarter where X.X per increased we dividend dividend be we straight as Finally, our dividend our the million in of is target. represents our of BDC to of DE, approximately $X.XX quarter. continues realizations

we platform paying the driven AUM numbers, are not portfolio reported Oak AUM XX.X XX.X of capital Street of fourth without the in capital billion, in billion. December XX.X and now was to our AUM XX.X Because AUM quarter addition Oak primarily paying I'll of Moving GP fee including by XX on Real billion of capital significant quarter-over-quarter, well XX. of the AUM fees total and We closed billion, Capital permanent yet provide XX% raising both and by appreciation as to during their XX. acquisition Direct Slide AUM Estate deployment Lending, growth with in as as Solutions. across billion Street. grew the of

Estate quarter-over-quarter, capital Direct by Fee addition at driven you AUM billion to look significant primarily the grew platform. of XX% raising Lending grew we AUM the quarter-over-quarter. Real adding our XX.X paying by If over organically in AUM and across XX% before Real Estate, deployment numbers,

numbers, annual conclusion million, billion X.X be were of management in and AUM that upon increase which of AUM XX. in the million tech $XXX management December yet Direct primarily in adding noted Lending corresponds GP our not Before the annual call to for GP Lending, X.X Real billion, Real holiday on reached Capital including Solutions expected fees incremental as this Solutions, grew quarter-over-quarter. quarter, another billion And, paying billion by upon paying X.X go Direct we XX expect fees our fees. in in past if I $XX BDC to last AUM we and fee public, totaling over an Capital deployment Estate fee the organically This to XX% ended Estate. for

of Direct our highlighted X.X for the earlier, That X.X funded billion Marc billion we last deployment another of brings strong gross of with had and XX As to billion, originations XX.X deployment. with deployment quarter Lending gross in net months funded net XX.X of billion. originations

Lending, Direct us two pace fully would last So X.X AUM fees on based the our quarters approximately relates net as over months. take deployment this, deploy average the to it yet funded billion XX paying of it in not to

position. continue to our strong in to a we balance capital sheet, be Turning

This liquidity debt week. of last can million dated includes you $X issuance As have on we the very unsecured did see XX, with Slide long billion structure. XXX a capital we over currently

debt, our and pricing, have amended As of upsized the an reset this financing, tightening million million XXX it to we unsecured and making commitments, from maturity. to facility, XXX upsized relates revolver three-year

of Finally, to minutes I'd cover here take couple to other few a a items. like

I'd First, our program, May share of million of Board Directors shares employee our is to their program. discuss where to outstanding. merger closing of under of shares connection the XX% program. X% with five share years. in employee issued have stock significant of last our reflect approved this we create issued roughly other amount year, About The were a of XXX our Under our employees with to XX about the shares in like and merger, issued In to a generally million the contributions to across period platform connection programs. were of with long-term vesting employee remaining two retention date,

we as stock X% a cash level opted of this you of all X.X of could guidance about as process. course we trying process, for our of roughly we issued how in issue to to second, stock. less compensation own million annual dated future, typically of employees our option shareholders to than for outstanding roughly under or the Almost XX% compensation outstanding. issued provide our everyone continue for shares who in about some part offered awards shares, the year-end And of normal First, result resulting for shares In think team X.X our our Owl exchange long Owl incentive Blue programs shares management one-time with employees to million a to align existing previous Blue recently shares, our with and issued. X%

post out. think I how about when what revenues XXXX, our up So posted here, XXXX, in plans and XXXX, XXX it here's think look can to revenues Rock rate accomplish billion of we revenues, In in Dyal million growth frame you wrap represent I would year. X.X we growth and XX% believe we In we which we the can year-over-year. for of Owl combined revenues would a at when over our

you joined can call who for we to on open the us that, today. Thank please again questions? operator, Okay. everyone the line With

Operator

Instructions]. [Operator Certainly.

question. of your Your Evercore comes first state from question ISI. Schorr the Glenn Please with line

Glenn Schorr

Thanks Hi. much. very

relative XX% the would what Owl growth. on a the coming XX? me You from about Dyal talk and Can have is contribution just core ago months think disaggregate the only what just onboard that got you few been acquisitions maybe you Rock, to

Alan Kirshenbaum

Sure, much Glenn. you very Thank the for question.

So let's second them of my numbers I've part to just as that. now back for the a refer in some remarks just put of

about So annualized AUM management BDC that we if yet could think incremental XX% another annualized more which of our fees. that's $XXX over management annualized of on tech generate fees, billion about little That's be is $XX XX public, XXX were fees. than million the we paying not will to XXX. a half, management XX% little of or And million of million about go that have a fees roughly

And for whole that any fundraising gets year. any us halfway across there equity products without so of our the

to get and holidays to almost a half get it can has rest you deployed, put of our that, at ground that So that through roll and us is grow business fee work, continuing or has as of think the off least have quarter the of is to to fundraising. in to already

Glenn Schorr

like would wouldn't the it just it, Any not do tech cool. why seems right, through downside why reason to think trying a you All no-brainer. It of I'm happen? the BDC?

Alan Kirshenbaum

careful, call. too in provide the some an at no here much wouldn't think that's want future here reason today. that point vehicle. we comments list and not because to be But see today We that registrant of we sitting look that reason we to could There's there's on SEC this no

Glenn Schorr

do I'll just more. it. Got Maybe one

give something on inception anything great. you performance XXXX? absolute XXXX. I Your relative are in and performance stakes Can Rock us see Owl about But and today GP didn't across

Michael Rees

be level Thanks, Solutions Michael GP The Glenn. the business It's strong. extremely continues Rees. from fund to a at performance

so and funds running to for recent Fund IRRs XX% most III IV XX% and are report. an Our material it's Fund V high, not for Fund is

again, on So position, relative corporate perspective, in probably been And fundraising be continue our over exceedingly performance months have products a XX enhanced the basis, to last do our couldn't timeframe. market and the well. a from stronger and our pre-IPO

Doug Ostrover

you comment? want to do Marc,

Marc Lipschultz

Yes.

So mid-teens all the in returns. XXXX on total had gross lending various we across lending side, the products for

did note, I we with true at credit inception, realized bright we focus. which is very that X-basis continued spot, of So as pleased rate. point continue performance core our Since And were loss remains a the course annualized performance.

happy the So with very results we're where landed.

Glenn Schorr

Thank you all that. for great. right, All

Doug Ostrover

I appreciate it. you, Glenn. Thank

Operator

Your from the state comes question. next your Please question line with Alex of Goldman Blostein Sachs.

Alexander Blostein

Hi. question, taking hoping saw could the guidance quarter, the guess. the in with morning. far we of unpacking provided the was retail the first you start I some and QX I observations Good in and for everybody. dynamics Thanks so obviously maybe

kind what as how And well of bigger Oak as Can both integrating picture First, helpful? out building you're momentum XXXX, ORCIC more tech like specifically color as then frame and fund help parse the be you ORCIC it about fourth little were us quarter? you a looking momentum. can that the of the lots feels think Street, into flows you would in across

Marc Lipschultz

This Great. Thanks, is Alex. Marc.

me start off. Let just

is So year, know, quarter raised in the alone, ORCIC, ORCIC, fourth billion. in our which, on as roughly we you retail $X primary product this

ORCIC. January wirehouse at couple on look only the on and as some And were we will still a the forward prior alone, know of really back comment growth minute So, $XXX the distributed. is and Doug see. you thoughts of substantial the In quarters, ramp, side a that kind platforms that continuing in with of that million we for raised quite a retail about

above platforms which of pleased. that about very ultimately a we're to, on this if some think get where people's and scale. expectations very, million of two level ago those topic, month, already we'd we're were moment where at we So with you we're even still I was this months thoughts know any six $X and at to back

over other, to Doug. and let it and As more XXXX broadly tech turn to me

Doug Ostrover

a the any six can Hi, the and everybody at And the if on it's But we've right I Alex. and call broad retail had back space that now We we're built I think I really top maybe players. been step just this, take remind think of we one don't brand. distribution. okay, strong broad I projections. have years, for a

two. we're I fact, think In credit, in number

include the And but certainty, our doesn't billion almost you raised the about this, XXX% and to fundraising, [ph] X don't today. We've sales most an covering support, are in think resources, for capital our for very if non-U.S. And fund include I that distribution the a million in RIAs, Street, billion in said as we that of I retail rate but and in it U.S. I In Oak presence over you think Lending was in the quarter headcount. the XXX you over across And just we the organic from partnership Doesn't income and broker September billion to are And billion fourth I covering And Canada. think I and FAs of wirehouses continued we've core been wirehouses, equity products ended new Marc us growth to in was where professionals XXX,XXX XX new the but X.X terms syndicate. our got independent in offices, I quarter. family run just we our of billion we're in importantly, continuing well. of we with raised got doesn't GP active X.X and as any Solutions. flows, announced dedicated dealers, We've can team, expansion X quarter, we're and we're Alan a of saw XX adding institutional in syndicate. that of you this, we well and we launch. add months, Direct plan largest flows. that's over know distribution gets if tell exact expansion number, we from to add last retail markets big referenced, And Asia retail from our two referenced active include current at couple quarter. think X% this of now AUM Marc

we does remain another million competitive. And for fund. XXX January, we income leave In products raised core for 'XX? think where I so very our guess So that are flows strong. us One,

has strong. the things that Our one. we our focused one of the from is performance And on about investor unique been really platform day retail

our launched, is And we've retail institutional you retail. with tell Our the I can clearly goal was investor. experience done really story a as is simple give identical that that resonating investor and that's what when we the

does to the about quarters. that We're upcoming big have to going more lot now. say optimistic it No this retail. where right us? in So as to a leave We're predictions relates

Alexander Blostein

we like pace that for Great. second the has It Solutions My business. than been question of is around color. expected. looks Thanks GP slower bit fundraising a

billion funds. you Michael, I or in so think said $X I heard

about it's Now, think longer. I bit you getting but to still little feel optimistic billion, a $X taken

think set ground going expectation? which are kind how is and thinking about on, the that fundraising, the to you relative maybe on slowdown you now said bit, next what's So the perhaps XXXX I leading is for sort of your to earlier opportunity of the of pace

Doug Ostrover

Alex. Thanks, Yes.

calendar around sizable. XXXX had is into schedules we segment. are raising busy institutional partners Fund GP which we As is a Solutions of our Calendar quarter, accommodate for very extended for last of globe. fundraising investors fundraising to large our largest the funds the out that Many there, flagship fantastic quite reported the deployment V are the It

in off this And first because institutional within really slot their And all work rush. working have to a we've large capital half base we're good we're our Fund so been real of, calendar. to investors along with deploying substantial in into no V and

close thing, above alluded sooner as our at possibly provided fundraise the will what guidance likely had in to, and before originally than We the as been IPO. pull even or I Fund VI targets this

and and in years well. billion confident business. year. our targets as last target penny deployment deployment very of prior with We our consistent to So We almost pace $X the the momentum of a across that about our year, hit

budget to our XXXX to investor the change for us. no our allowing absolutely or momentum, just some of model So utilize business their institutional

Alexander Blostein

I'll Thanks. jump it. into Got the back queue.

Doug Ostrover

Thank you, Alex.

Operator

your question. with next question state KBW. of the Please Robert Your from Lee line comes

Robert Lee

are Everyone, morning. well? all Thanks. you Hope good doing Great.

Doug Ostrover

Rob. morning, Good

Robert Lee

Hi.

look transaction any that's meaningfully other? way dynamics or looking kind in I capital way, the question set one GP and you all? first environment Just When maybe when has competitive your at back to I'm deploy my Petershill then just guess the to shape changed Does or change form Solutions, the there, the or going out first opportunity question. not at my competitive curious. of you're

Doug Ostrover

a We're Thank you, in in our is deployment capital. faster Robert. peers set really for segment we that unique opportunity spot growing and within are our alternative than raising the

capital So overhang large powder. really or we other selective, a dry areas, be there's not unlike can

a we've with I and does players typically IV allows we strengthened position has really to are really this of had cannot on to of large probably on managers billion in larger earlier. good be partner raise and competitive up where the We our it for reasons in those two that focus X fund Fund and And maintain X as shows now so not typically transactions within us funds; discipline, pricing alluded three the continued that change and There only about cover fund. And returns which major Petershill. number selective to operate. only our Blackstone space; peers for billion this ourselves,

that, markets expand. to capital segment these for addition continue larger In of within the the needs private to firms

growth of are strong the we for and in XXX often as the said, the top stronger, are And space. leading bigger As remarks big that -- are GPs believe XXX, prepared the getting getting they need we capital. the capital provider this

of has position and really the created team last competitive over momentum So of years. that proud the the good couple really

Robert Lee

talk think curious. perspective? impact rating Great, provide more fee from just kind that? know just how on of generally, to thanks. average brings what about we can And maybe maybe out, should on some modest any financial new it than I a kind capabilities you Obviously, in, but have your flush but CLOs it of Wellfleet, color

Marc Lipschultz

than happy More Marc. is This Yes. to.

everyone, itself, really of platform. it our CLO to a may the very Wellfleet about a not or think I'd of The outstanding under way acquisition point $X.X and view of may familiar management. from of which manager Wellfleet, tactical our in really effective So you billion to assets is be and that is suggest or addition

fee of Direct nature to about of This type. quality CLOs. course, very, very that in high businesses that But business of a of make, capabilities. You is isn't our into complements lots this directly get correct ambitions rates our the observation the about a Lending

markets. this permanent supports allows the adjacent us for our or for greater, look to of into management to the do what liquid and BDCs, So private example. life of components broader retail liquid deeper products, a the is of also our capital, have [ph] It

in execute continue class it to to side current of while So on us CLO this in platform synergy our of allowing us to best really Owl products, this manager. support its to full high Direct very the brings the Blue our great level deliver quality allowing Lending

Financially I would think think it about that's speaking, system. of the our fitting a observations. in I So way couple terms of

with in but or managers. CLO it's So not line way one other [Technical exact Difficulty] numbers,

capabilities and any would needed a of adds we So firm I as as And said, accretive. case. in that itself also, have in

is just forgoing what our capabilities amounts the synergy elimination, to we effectively that So but to that is costs current otherwise had cost an there manage future to to create have absorb books. not would

it's changes So a fashion. any Don't tactical material in very we it think and nice financial addition. numbers think

Doug Ostrover

get And our forwarded upon will closing, Rob, those Lending numbers numbers. Direct into

Robert Lee

And Alan. one just then you, great. maybe Okay, for follow up

targets about should how of FRE into to I year, or revenue heading But your kind margins kind on So of kind appreciate next any change update any the be we of additions? guidance. thinking

Alan Kirshenbaum

income Thanks, changes the Rob. No on No previous No changes that. updates revenue, guidance. to provided on to the to guidance margins, that I've G&A. on on previously

Robert Lee

questions. taking Okay, great. for my Thanks

Alan Kirshenbaum

Rob. Thank you,

Operator

Research. line next your Autonomous of comes the question. Your Patrick state question from Please Davitt with

Patrick Davitt

quarter V, morning, last on Fund you I was guys. it Hi. Dyal more One committed. said XX% Good think

And this number you that's So X need this firstly, the if do more billion is suggest what I you year, year. X again would would of and billion case, that now? deployment than

launch XXXX? Fund than not why you. So earlier VI Thank

Doug Ostrover

very a in of that quarter. that then that the Yes, co-investment fourth We was number good deployment have up topped sort modest of back did brought question. down amount by

be But we're in right rate, the to capital be back The road. and very is be a deployment relatively TBD. this pause percentage VI that likely raising prior date at first deployment is in soon. line it. point deploying Fund half take on with then relatively yes, likely the and launch is throughout the the to that And your Fund of number. official brief market V We'll of So valid we're

Patrick Davitt

second then And on index thanks. question sense, and Makes more structural side. it. Got inclusion the side

First, I'm cap. the MSCI wrong sure seen market you've in you're given index, your

and in share adjust you. working the could to to governance to your that? to Russell speak willingness June? structure get So curious been you into Thank And if fix second, you've

Ann Dai

Hi, Patrick. It's Ann.

a passive So we're the these aware that of and very follows AUM active about basis. amount on indices

of So you we're you updated items both as we'll do those looking And at we that keep actively that. mentioned.

Patrick Davitt

you. Thank

Doug Ostrover

Patrick. you, Thank

Operator

of Bank from your comes of Craig the state line question next Siegenthaler Your with America. Please question.

Craig Siegenthaler

Thanks. morning, everyone. Good

Doug Ostrover

Good morning.

Craig Siegenthaler

what ownership there in but half given stole earning in moving stocks? only of terms question, you picking Patrick your passive a prospects is advantages up of owning that's on dividend fixed is Just dividend? long to stream, do of the fixed to see predictability your sort half my other [ph] any and So consistent restricted the

Alan Kirshenbaum

I Craig. that. appreciate Thanks,

continue the to the we expect DE. of time distributions can target for stated for quarters, variable that being that we've a previously the maintain with several For next

moving We to a extensively dividend. fixed are of the evaluating concept

We go as expect to have more updates we the next of for you quarters. through couple

Craig Siegenthaler

follow you, just sort Owl as And question of my Thank Rock. up, an open-ended Alan. on

the ORCIC, backdrop impacted first fundraising it's from So across credit and response evolving getting an your question, macro earlier BDC actually how your private your it has vehicles? the prospects sounded better like And quarter. in to

higher interested away to I'm income? rates fixed benefits liquid higher [indiscernible] rotation equate the is so in But X Part And incentives from your financials. also it and

Doug Ostrover

appreciate I it. a good it's Yes, question and

but important secured the the have data, correct, to it's best don't going just period, do. environment. be. than originate increased But we when given these the And are in we're what rising have rate secured to in We Fed pull remember I if senior assets risk of some more this floating a me times senior think instruments. of a can to think you all rate couple -- great memory floating I been rates has has any serves a together. place and rates, I

income rates interest Direct is strategies. expecting also these benefit rates And around the will be time. demand going there's we're higher I incremental Lending net our so think uncertainty for And over what our to with

that market are again, good probably don't retail higher, to the we're this to want aware we to On going fundraising retail rates a The side, predictions, place big out. and seeing flows. is but is any go hide consistent make

flows we cautiously confident highly can that with raise. time we'll and we're over I about So we're current that. mentioned, syndicate syndicate, the as corresponding hopefully optimistic And really we can grow get what our

Craig Siegenthaler

Great. Thank you, Doug.

Operator

[Operator Instructions].

Evercore You do the of Glenn with have a line Schorr follow-up question ISI. from

Glenn Schorr

front. Hi. on I One appreciate it. the quick more retail

kind their now the I'm brands either. is going retail have wholesale? this. your your and in on domain strategy own to not go-to right. you do then curious for each product now how of and this four in just you you're is I'm acquisition with make for So last sure What dominance will

Doug Ostrover

is market which and income four-week -- retail our retail. Direct that retail. is are institution. One do way fundraise lot continuously Lending two year is now, offered that retail raising fund the and is right of we access is core the of a products is day-out strategy. to into referring What of what more we the a we've you offer of Well, you Fund a day we a in are have you There Right go to three, one in -- types fund, offered. in been V a now, do you're every being large day-in,

position to that these over looking think advantage into and share our be say quarters, do with strategies it other out we'll rolling to take the we've retail suffice of be in couple with the platform retail. will We're will that large But to next of you a right we we partnerships now. distribution distributors. the not built I

Glenn Schorr

acquired newly is In some no But strategies. coming with going Owl other maintain a be or brands? brand? your Blue under old they're do asking, to comment their which I'm right. called sure -- words, All they to be going everything is this of I'm

Doug Ostrover

And our the the we'll now maintain our distinct Oh, we'll I next years, I going umbrella. of maintain into see. everything we for Owl are the But couple Look, brands. Blue over time, think over roll brands. foreseeable future, for to

Glenn Schorr

you. Thank Okay.

Marc Lipschultz

Maybe addition just a topic quick acquisitions. of this brands on and

want actual how As deliver of we we'll arc anything class brands. time a underpinning experience in we to of really the for an of terms point is said, investors. the Doug have best we the manage But do

deliver breed be spaces, GP fashion solutions, talking kind market return grade experience? very time Direct really Lending, Oak there. great in returns The solutions attractive Street, and adjacent First built risk in and every exceptionally lease triple And business that that's of and the with to to investment best businesses leading ought we in net we've market do in really with counterparties, Solutions, how the for right. business from leading grow leader evolve continuing foremost, why about in we of deep market

away to you'll our stockholders. of and that So on continue But best being us, for kind breed again, you we'll allow is to take exact to what will best revenue really ought strategy. continue is FRE the see growth deliver delivering breed which marketing think from growth to for evolve of brand focus investors, really us depth what us and strategy of to our and and I

to acquisitions We're adjacent In to of your terms private all to solutions question, really handful of people. things great be ecosystem capital users. all I We're additional looking in products want be not for embedded of to at that create again, capital a amplify. looking this private

get We'll properly. look think So continue acquisitions. approached to certainly, we time. But we all to this I want the at calibrate

that do when they're very ecosystem great our expect we deliver shareholders. should results, growth to for these do great again returns acquisitions, really build so strategic and we around this can and You deliver it

Operator

Please Autonomous Research. Your Davitt the question with of state from next follow-up line your question. Patrick comes

Patrick Davitt

in expect you idiosyncratic? no fee more follow for Thank performance on pretty the the we guide. those And there or assume is $X.X I Should quick fee. was that A one of performance million up. the

Alan Kirshenbaum

the in fee guide. billion performance no is $X.X There

from that X was performance So tech a our BDC. Part fee

calculated like not Part that's You could fees. expect quarterly the X annually, -- and

small It's potentially in quarter. X fourth you could could from of year. take you Part each you really as we number see can XQ expect very, expect each rounding that each the So fees very but potential out some here,

Patrick Davitt

it. Thanks. Got

Alan Kirshenbaum

you. Thank course. Of

Operator

Your next line follow-up state Sachs. question Please the comes Alex your question. Goldman from with Blostein of

Alexander Blostein

at your had But the we've materials question big of are your pace originations dynamics the Thank of recently? to follow the as around spot pretty quarter environment, this business. and and seen as deploy same fourth seeing how picture capital I seen We've and Lending quarter ability curious Direct in up sort the obviously in third top Great. out a sort of current backdrop. activity both net you market today origination for well. given you get and

Marc Lipschultz

Yes, more chat than happy to that. about

So expect. extraordinary it of what as you we fourth and did not indicative more activity observe think and third appealing. I the quarter, in was And frankly, origination than

will require Owl private in month, Blue given powder week, picking trillion and and in set capital the Owl terms remember, now solutions. get in but up private will share. we're I deployed and our solutions Let's deployment, substantial equity. frankly, think That it more lenders our quarter. Rock, aside And in share, particular, any clearly with of of terms pace generally, of dry private $X But in sitting

So deployment markets, reasonable quarters. over very to to pace arc of Activity be there's we slight in the exceptionally the little if at a volatility of busy. But us think divide be just in there, year, that and it causes those but strong. busy sometimes about look year when continues variances overall, four. continue strong of total, we the took quarter be and the there'll pace That Again, the were here when through last pauses. rise, like they the to course some feels and time. whole by I Again,

deliver And built have is extraordinary. a continue the of I structural ability years capital the that for the tailwind others frankly think we and with to amount seems to come. to powerful solutions, especially biggest I the busy. just pretty think be others quite a in business couple demand for demand, This

Alexander Blostein

Got it.

very Thanks much. Okay.

Operator

question Please the of follow-up question. KBW. from Robert state next Your line comes your Lee with

Robert Lee

I've Thanks follow-up on don't again. this think call. I years questions Thanks for taking many my the up. follow in heard

patience. So your thanks for

Doug Ostrover

We appreciate the interest.

Robert Lee

and maybe Thanks deployment the This question another Marc taking for from time. is on whatnot.

thinking of your of thoughts from also a maybe bit talk little a liquid about. high where discipline, maybe Obviously, credit, in be at more you've capital talk with the look grow maintain would Wellfleet, kind verticals be other got you your rate, little on part about or investment the infrastructure, and to as to can So non-sponsor things. continues of you to funnel, your bit maybe the great? may kind because so a then -- at marketplace more about own to of there, investing stand your you quantum speak, maybe And

Marc Lipschultz

to heavily we to. invest and that butter investing is thoroughly and origination the and ability happy the funnel of Sure, credits to the evaluate we in continue will. our And Look, in bread business.

the Lending, the We largest to grow highly Direct have of and today teams continue experienced dedicated originators, one for underwriters team. we

Lending be growing, business. I think doing and just to quite up we rapidly this Direct XX may professionals about

point And see we so enormous I think from of flow. that to continue view,

seen the historically speaking, to end see So that the flow the funnel continue day, grow where beneficiaries sponsors of we're you've been sponsors. Solutions sure. of to sort about XXX intend kind of it's number with continuing And through cover for to that at the roughly about top We of business we of the continue same the of bottom. grow as we have pace to from continue in to today. flow. X% the We’ll GP Sponsors

and can That the is focused always breed, we rate, of loss pick the underwriting. we're so from which in how see investment origination realized that comes best point opportunities on most kind ones. candidly, to I So, X-basis best think to

in the the cap structure. ground. of plow. we If of take we simple just of $X XX-XX that's -- I trillion So plenty top that see a $X new trillion out demand and a dollars field of That's to take there dry demand. to refinancing trillions on just private in think back equity Again, powder lot of let's of that's go

So it's we degree way do about of an maybe business but more is anecdote anecdote, frankly, just corner with and To what part than -- peers, the tiny of has market a little I'll shifted. And the one we're our a today. every pretty the this.

billion go the the Direct for there year -- Lending solution in you we're marketplace. $X done years, market. alone Rock five whole hadn't If and really back This Owl not about been

the that we've market. meaningful seen billion [indiscernible]. We've actually whole We're plus part which the evaluated, $XX of $XX market. financings billion a we've We’re of not

the an and think the you pivoting And a Lending market Direct even as that about solution, for lot biggest is so way I tells attractive towards the best companies. seeing

Doug Ostrover

other make just one I'll Yes, comment.

are continue resources. to going add we to So

We focused funnel. that maniacally on are deal

private sponsor we're We that involved think we're much hard saw got We job companies great bigger lending taking the we with community a a a be strategy ever about I doing as well. the community, at years an niche. four to large VC dedicated ago. and imagined. It's turned tech than look as in out interesting

sector. billion XX in that loans to close of have We

we're other talking be over of that technology over should to next look, my about focused is people it. evaluating constantly guess sectors those. start position in? have XX-odd We large make are a in the quarters, And couple there sizable on we'll And we a like push

pretty opportunity equity private these Marc firms as we're large growing. is and starting set hey, and to And banks. the more to So companies private say, good alternative alluded is big. seeing more the just a It's to, this

can optimistic So deployment we're about pretty where that and pace we take the business.

Operator

additional for I floor At will closing this questions. further Ostrover Doug or now remarks. turn to time, there are back no any the

Doug Ostrover

everybody want I time. anybody want goal We're has for anytime I continue the going to the over any try for follow and all up. an exceed taking thank thank to is Well, the record maybe set expectations. And hour. a if to But available we great really to questions. everyone our to partnership

So to thank forward to all you you, and talking look we of soon.

Operator

call. today's conference concludes This

may at your lines disconnect now time. You this

Blue Owl Capital (OWL) 17 Feb 222021 Q4 Earnings call transcript