Blackstone Strategic backs those that want to be bigger, better, faster

Thu Feb 3, 2011


Blackstone’s second seeding vehicle, Strategic Alliance II, has just launched with $2.35bn and seeks to invest $100m apiece in 15 to 20 star managers


By Claire Makin

J. Tomilson Hill
The Blackstone Group may be the biggest player in seeding space, but the New York-based behemoth prefers not to describe the business as 'seeding'. The word usually applies to start-up managers who have no other option but to approach a seeder, says Greg Hall, who oversees Blackstone's Strategic Alliance platform for emerging managers, along with the Strategic Alliance investment committee.

These typical seeds are not the sort that Blackstone is looking to fund. Instead, Blackstone's start-ups usually have plenty of other funding options, but want the extra boost that a partnership with Blackstone offers. "They are hoping for a higher probability of being bigger and better, faster than they would otherwise be," Hall says.

It is a fine distinction, but a crucial one for Blackstone, which hands out a minimum ticket of $100 million to a select group of new managers. The firm's...

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