Doug Ostrover, co-founder of GSO Capital Partners and Blue Owl Capital, recounts founding GSO in 2005 alongside Bennett Goodman and Tripp Smith.
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“We're going to do something that nobody really had ever done, and that was Marry both public market expertise with origination, and direct lending wasn't really a thing back then”
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More from Doug Ostrover
Insight
Direct Lenders Achieve Lower Losses Than Syndicated Loans Through Better Diligence
“The other thing we need to do is because we can do a lot more diligence than a syndicated participant is to make sure we better protect the downside. Whatever the loan losses are in the syndicated market, we need to do a much, much better job. Because we have …”
Doug OstroverJul 26, 2021▶ 23:17Private Equity Masters 6 – Doug Ostrover – Blue Owl Capital (Capital Allocators, EP.205)
PredictionNot checkable as stated
Private Equity Returns Will Drop Meaningfully Due to High Multiples
“And I think PE is going to be a good asset class. It's going to be a great asset class going forward, but we have to realize returns are coming down, and they're coming down meaningfully. They have to. Purchase price multiples are exploding, and so the higher …”
Doug OstroverJul 26, 2021▶ 37:32Private Equity Masters 6 – Doug Ostrover – Blue Owl Capital (Capital Allocators, EP.205)
Insight
Closed-End Credit Funds Suffer Adverse Selection From Early Refinancing
“The problem, if you think about it, think about the loans you make in years three and four. Usually they have a year or two years of call protection. A lot today have only a year. So what happens is if a company does well, they refinance you out. And so you ha…”
Doug OstroverJul 26, 2021▶ 42:00Private Equity Masters 6 – Doug Ostrover – Blue Owl Capital (Capital Allocators, EP.205)
AssertionNot checkable as stated
Owl Rock Had Zero Voluntary Employee Departures in Its First Six Years
“We have today About 300 people, and we have not had one person in six years voluntarily leave, not one.”
Doug OstroverJul 26, 2021▶ 19:13Private Equity Masters 6 – Doug Ostrover – Blue Owl Capital (Capital Allocators, EP.205)
AssertionNot checkable as stated
Every Owl Rock Software Loan Is Meeting or Beating Underwriting Targets
“Every single software loan that we've made is hitting or exceeding its underwriting case, and that's coming through the pandemic.”
Doug OstroverJul 26, 2021▶ 31:07Private Equity Masters 6 – Doug Ostrover – Blue Owl Capital (Capital Allocators, EP.205)
AssertionNot checkable as stated
Sellers Inflate Stated EBITDA by 20% to 70% With Pro Forma Adjustments
“Anyone who's selling a company will take this stated EBITDA or cash flow and have sometimes as low as 20, sometimes as high as 40, 60, 70% increase for what are called pro forma cash flow adjustments. Every company is being sold off those adjustments.”
Doug OstroverJul 26, 2021▶ 54:13Private Equity Masters 6 – Doug Ostrover – Blue Owl Capital (Capital Allocators, EP.205)
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