FUNDRAISING NEWS | October 11, 2024
While BlackRock’s record $11.5T AUM and earnings that surpassed analysts’ expectations may have dominated the headlines when it reported third-quarter results on October 11, its continued growth in alternatives and related fees was hard to ignore.
Total alternatives client assets at September 30 grew to $334B, of which $305B were fee generating, according to the company’s earnings release supplement. Even with the growth, alternatives still account for just 3% of BlackRock’s AUM at the close of the quarter, compared to 55% for equity and 26% for fixed income, but they produced an outsized 11% of the company’s base fees in the third quarter, compared to other products. Equities and fixed income, by contrast, represented 51% and 23% of fees, respectively.
“Private markets are a strategic priority for BlackRock,” CFO Martin Small said during the company’s earnings call with analysts. BlackRock CEO Larry Fink echoed Small’s sentiment, but took a slightly different tack, saying of private markets, “We’re not going to say they’re alternatives. They’re just part of the marketplace itself.”
He expanded on that later in the day in an interview with CNBC. “Now what we are seeing through the capital markets is a blending of privates and publics. I think we’re going to see portfolios that are looking at publics and privates in a blended way,” Fink said. “So we’re seeing now private credit becoming more the domain of the capital markets, away from banking and insurance. This is all a part of the growth of the capital markets.”
