YouSaid · the spoken record

Henry Kravis

lines on the record: 65
first: 2024-01-05
most recent: 2024-01-05
sittings or episodes: 1
sources: podcast

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“Well, thank you very much, Allison, for having me, and thanks to Goldman Sachs for putting me on the career that I had and you being such a great friend to the firm and to George and me personally. Thank you.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Right now, I am concerned about all the uncertainty, as you said. To me, we've got to keep our eye open on all of this, how it will affect the U.S., how does affect mankind, how does it affect democracy? So I wouldn't call it, I'm excited about it. I'm just very concerned about it and aware of it. And other than excited about my family and what they're doing and how my grandchildren are growing, that to me is the most exciting thing. And what George's family is doing, I'm just cautious right now and I am concerned”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Don't be afraid. I remember my last summer here at Goldman Sachs, and one of the partners came to me and he said, I want you to call the following CFOs and get this information. That was at 8.30 in the morning. At 11 o'clock, I had not made a call yet because I am scared to death to be calling these people. And I said, oh my God, they're going to ask me questions. I won't have any answers. And so I knew I had to get some answers for him by the end of the day. And so I just forced myself to do it. And it turned out not one of these people asked me a question. They didn't ask how old I was. They didn't ask anything. They answered my question. And I wish I had known that and started it earlier. It took time to build my confidence.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“We got halfway through, and he said to me, Wow, you know a lot about my company. Well, I didn't tell him I am scared to death to be sitting there. I didn't tell him I had read every footnote of everything I could possibly get my hands on. There was no internet then, and this was nineteen sixty seven in the summer. And he said, I'll tell you what, most analysts that come out to see me have not even read my annual report. So he said, not only do you know a lot about my company, I told you I had an hour for you. He said, I want you to spend the day with me. Come to all my meetings with me, and the SEC didn't frown on it in those days. Just sit there. You'll learn. At the end of the day, I'm going to take you on a tour of the studio myself. He never once asked me, was I a partner at the Madison Fund or a summer trainee? He never asked me anything about me. All he cared about was that I knew a lot about his company, and that's what impressed him. And so I tell that story because it had a huge impact on me, and I hope it will have an impact on younger people that might be listening to this.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“A man named Ed Merkel who ran the Madison Fund the year I graduated that summer I got a job at the Madison Fund and I arrived there and he would call me kid and he'd say all right kid I want you to follow these industries and I said but Mr. Merkel I've never bought a stock in my life he said it doesn't matter we got bumpers here you're not going to blow us up and I started buying stocks a monkey would have done probably just as well they all seem to go up It was that good time. And then he came to me and said, I want you to go call on Roy Disney. And I said, that's not in my group. He said, I know. I said, who's going with me? He said, no one. And so there I was scared to death to go see Roy Disney at the Disney Company. He and his brother Walt, who died the year before, started the Disney Company. I went out there. Roy Disney said, I have one hour for you. Now, if he'd said, I have 15 minutes, that would have been enough too, because I am scared of that to be sitting there. I'm a kid just graduating from college, and I'm sitting there with a great Roy Disney.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“I've had two mentors, actually three. The first one was my father. I was very close to my father. He was a petroleum engineer, extremely good in math. And he used to try to help me all the time think about visualizing a math problem. And it took me a long time. How do you visualize a math problem? I could visualize geometry and so forth, but I couldn't necessarily visualize. But he really helped me a lot in how to do business and how to think about it. But most importantly, he drilled into me ethics and how important ethics are in business, that your words, your bond period into conversation. Secondly was a teacher, an economics teacher I had at Loomis my senior year. And that was Jim Wilson. He said, you got to take my course in economics. I couldn't spell economics. I didn't know what it was. But he kept after me. I said, okay, I'll take it. The best thing to happen. And that for sure really set me on a path. And the third person was.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Oh, that's easy. Thank you for asking. That's my wife, Mary Jos ⁇. She's the smartest one I know. And I love talking to her and sharing with her. And thank you for asking.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Like the best lesson for me is one that didn't go well, and that was called Jim Walter Corporation, where we were sued to pierce the corporate veil because of asbestos in one of the subsidiaries that they had owned long before we ever bought the company. But we stayed with this company. We had to put into bankruptcy because we were sued by a smart lawyer down in Beaumont, Texas to pierce the corporate veil, put it into bankruptcy. But the important thing was we stayed with the company, got all the way through the bankruptcy, got all our investors their money back. And it had been very easy. It was $117 million. We could have just said, look, forget it, we're moving on. No, you give us money. We're going to do everything we possibly can to get your money back and hopefully with a profit this one had a small profit, but it took us about 17 years to finally do that. And to me, that was the best lesson I could possibly learn and pass on to anybody else. We have an obligation if we take your money, Allison.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Very first investment that I was ever involved with was a company while still at Barris Stearns. And Barr Stearns, by the way, never put a penny into any deal. So we had to figure out how to cobble together a little money. It was a company called Eagle Motor Lines in Birmingham, Alabama. And I remember going to the chemical bank to borrow $16,000. As I said, I had no money. And I borrowed $16,000. I made that investment. Didn't turn out so great. But that was my first investment.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Through SEO. Interestingly, he's an SEO grad to get into finance. And he said, I worked at Goldman Sachs for two summers, a summer, and that was fantastic. And then they offered me a job, and I was there for two years. And so he had a break. But what stuck with me was that he wanted to do something different. He wasn't just single-minded. He turned out to be a great investor. He's turned out to be a good manager because he had these different interests. And I can name others that also were exactly the same.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“What I want you to see is possibilities. I want you to see the whole landscape and figure out from that landscape what are the possibilities. And to me, it's understanding these very important issues. Young people will come to me. And I said, you know, Mr. Kravis, I'm going to college and I want to go in your business. What courses should I take? I said, you're probably going to hate my answer. I said, just go get an education. Go get the best education you can get. No, no, you don't understand, Mr. Kravis. I want to be in your business. I think I understand pretty well. Yeah, we sort of started the business. Too many people today specialize. I want people who really come with different interests and backgrounds. I'll give you one example. Joe Bay really stood out for me when I was interviewing him, as other people. Why? Because he said, I spent a lot of time thinking I wanted to be a classical musician. And he said,”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“With both. So, the advice I would give my children and grandchildren I've tried is one, be innovative, be curious. I don't think anyone can be a great manager unless they're curious. I don't think anyone can be a great investor unless you're curious. You have to understand how to connect the dots. It's a very important thing about investing. And this curiosity, and I'm talking about not how does it deal work. So I'm talking about learn history, learn literature, study geography, et cetera. And you're going to find how important that is and how that comes into play when you're thinking of how do I connect all of the dots. I often like to say that if I took people to the window in my office is on the seventy seventh floor at Hudson Yards and I said, if I take you to the window and I ask you, what do you see? And I said, oh, it's a trick question. Let's see. I see that tugboat in the Hudson River.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Well, first of all, I hope my children and grandchildren listen to me. So we start with that So let's assume they will listen to me. Look, first of all, I say to them, Take one sentence out of your vocabulary. And that's very simply, I wish I had. I hate that when I hear, oh, I wish I had done this, or I wish I had gone there. Okay, you could have done it. And we live in a free world. We live in a wonderful country in America. And you can make mistakes and try again. So I'm very big on pushing people to give it a try. Don't be afraid. Don't just talk about, I hate that, oh, I'm going to do this. I'm going to do that. No, go do it. Both feet in and be dedicated. And if it doesn't work, okay, pick yourself up. Go try it again. Don't be afraid to fail. There's nothing wrong with failure. In fact, I'm often looking when I interview people. Tell me your failures. I want to know. I've never had a failure. I've never had a bad investment. Well, next, because that's not life. And so I feel very strongly that you have to dive in.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Of these students that we place in the summer and the highest we've gotten to is 93% of those underserved students were able to get a full-time offer. And so we know these programs work, but we're working with them and it's holding their hand, just making sure that they're guided. They have no one to talk to. SEO gives them that strength and gives them that opening and opportunity which they wouldn't have otherwise.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Days a week after school to get extra training. They end up with 720 hours of additional schooling in the high school part just to get into college. But they're prepared when they go to college. 93% of our students who get into college graduate from college and just think what that does for the underserved community. Having a college degree makes a huge impact, not only on the person, on the next generation in that family, et cetera. And then the other one where Goldman Sachs has played a very important role, as have others, and that is called our career program, where we will go on to college campuses, help find those students that are just looking for an opportunity. They have to have a B average or better to get the interview. We interview them, then we give them 12 online courses. They pass those. We will then take their resume and get it out to the different banks, to law firms, to other corporations. And basically, we have about a thousand.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Arms to it. One is their scholars program taking young students in ninth grade through college. So it's an eight-year program. They come from underprivileged area, basically $35,000 to $40,000 household income and below, first in their family to want to go to college. So we want to give them that opportunity. Now, that means if they're going to do it that they have to agree they'll stay in their schools wherever they are in New York City or in San Francisco. And we're now taking it nationally. We're now down in Greensboro, High Point, North Carolina. But we want to help those students not only get through the high school part, get into college, into the right college for them, and then to graduate from college. They end up spending 40 Saturdays a year from 8.45 to 4.30 in the afternoon, and the month of July five days a week, 8.45, 4.30 again, and come in one to two.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Said, sure, we had lunch. And I said, I want to ask you a question. I said, I'm just now starting to make a little money. I'd like to give some of that money away to help organizations. What should I do? And he gave me the best advice. He said, look, I'm not going to tell you which organizations to invest in, but I will tell you one thing. I will tell you whatever you do, get involved. Don't just write a check. And there's a huge difference, as you know, Allison. You've been involved in lots of organizations, whether it's NYU or others, where you really roll up your sleeves and you're not just writing a check, but you're trying to make a difference at that organization. And that's what Mary Jos ⁇ and I do. We really believe in it. George has done exactly the same thing. He set up a phenomenal organization called Redif. And one of my favorite organizations that I'm involved with today called sponsors for educational opportunity or SEO. And it's an organization that has several”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Well, thank you for asking that question because philanthropy is such a very important part of Marriage Jos ⁇ in my life. And I can tell you exactly the same thing for George and Lennet. I don't know why exactly our parents, I guess, instilled that in us. And people talk about giving back. I don't know if it's giving back. Did we actually take anything from anybody? But really, it's more, what can we do to make people's lives much better and giving them the opportunity? So Mary Jos ⁇ and I focus on the arts, medicine, medical science, and education primarily. Those are the three areas that we have really dug in on, and although we've invested our time and money into lots of other areas as well. I remember when I was in my 40s and I called David Rockefeller, who I thought was one of the best philanthropists around. I said, David, could we have lunch?”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Well, exactly the opposite happened. These employees said, if this is the way this company treats me, I'll be with them for life. I'll never leave. And that was what we were hoping would happen. And it did. So the ownership works. We're putting it in all of our companies today, as I say, in Europe, US. And we want that alignment. And we want the workers who are making things happen have a real impact. By the way, if we as CEOs of companies don't pay attention to the workers, this gap between the management and the workers is just getting larger and larger. That's not right. We don't think that's what should happen in business. You have to have a better alignment. You have to close that gap between the top executives and the people that are really making the company happen.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Now, if you think about what that does to a family, what it does to a community, and the interesting thing about it, I was saying, gee, I feel sorry for Newcorp because I'm not sure they're going to have any employees.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“To sell the company to Newcorps, the steel company. And we said, if you were here with the company from January of last year until May of last year, which is when we signed the agreement, you're getting $20,000. But if you were with the company at the beginning when we made an investment seven years before, you're each getting $800,000.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“People in Washington explaining to them what we do. Now, you mentioned ownership works. I am so proud of that program. It's one of the best programs we've ever come up with. And what it is, is to make sure when we make an investment in a company in the US or in Europe that the management have an alignment with the workers so that the workers, whether you're a truck driver, whether you work on a plant floor, whether you work in a computer room, you have a chance to participate in the ownership just like anyone else. I'll give you one example. We had a company of many that we have put this program in called CHI. CHI manufactures garage doors. And we told the workers, all the workers, the women bought it, we're giving you a certificate. And when we sell the company or we take it public, you can probably count on this being worth about $15,000 if you're here with the company. Fast forward seven years and we made a deal.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Very recent. And so there's still a real misconception about what we do. So I found after the RJR Nabisco acquisition, I was invited to appear before six congressional hearings and I ask our lawyers, did I have to go do that? And they said no. And so I said, I'm happy to go down and talk to anybody that would listen to what we do. I went down and personally met with 31 senators one-on-one and a handful of congressmen one-on-one. And then George and I together met with the House Ways and Means Committee. And by the way, George was with me on some of those one-on-one meetings. George and I had two-on-one. So what I found, I didn't find anyone, not one person that understood how business works. Forget what we do. We're complicated, but how business works. And that's what you're starting with. So we've learned over time, you have to spend a lot of time with...”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Well, it's an unfortunate characterization of an industry that really has helped many companies. And if you think about the people that are really helped the most, those are the pensioners that have their money with state pension funds, corporate pension funds, et cetera, because they are probably the largest investors in the private equity arena. If you take what you've just said and expand that, the characterization, and let me give you an example of what I'm about to say, we had a group of senior officials from Washington come to visit us, just came in. These are congressmen and women. And they start off by saying, now we assume when you buy a company, you get rid of all the benefits, right? Well, no. If we got rid of all the benefits, we wouldn't have many employees working in any of our companies. So the answer is absolutely not. That was an extreme example.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Unfortunately, really had an impact. We are no more barbarians than the man in the moon. We will not do a deal, and we've said this publicly many times, if the board of directors said go away. We have no interest in dealing with you. We don't take positions in companies and go in and rattle the saber and say we're going to throw your board out. And so that's just not what we do. And so we want to be a friend of the company, friend of management, where it's appropriate, friend of the board, where it's appropriate and so forth. And then really take the long-term view of how we can improve the operations of a company.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“A lot of quotes were wrong, but because Brian Burroughs was not there, the author, but it was the title that has stuck, unfortunately. And by the way, I've been called wars things, but it's hard to shake that even today. People say, oh, yes, your first deal you did was our Jarnabisca. Well, we started buying companies in the late 60s through Barris Durns and then many companies long before we bought tar and abisco. So it wasn't our first. But for the general public, it was the first time they'd ever seen anything. And I'll never forget for some reason, I think it was 1989, George and I were named financial men of the year by the Financial Times. And so we debated, should we talk to the journalist or not or just let him write? And so we decided, okay, each of us will talk to the journalist separately. And I finished my one hour or so interview with the journalist from the FT, and he said, you're not anything like I thought you were. And I said, well, what did you think I was? You know, a man with two heads and horns? He said, close to it. And so the title...”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Well, look, we got involved and were successful in acquiring RGR and Nabisco in the 1988, 1989 period. Let me just talk about the book because the book was an interesting book. The book probably was 85% about accurate as to what happened, which is really good for a book.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“We've done a number of corporate buildups within KKR and over the years, whether it be in the dental service business, whether it be in pet clinics, whether it be in a lot of other industries. And they've worked out just fine. And so I call it buying wholesale and eventually with a multiple to retail because you're now large enough to have a retail multiple as a public company at some point. So that's what I would do.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“What I wouldn't do today is go out and start a fund. There are too many funds today. Everybody hangs a shingle out and can raise some money in a fund. What I would do today is I'd buy one company. It doesn't have to be big company. And I'd use it as a vehicle. I go get the best CEO I could find to run it day to day. I'd become chairman. We'd provide capital for this. And by the way, want to do this with George and do a buildup. And so many companies today actually started that way. And you look at them and they're large companies.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Interesting you say that it's absolutely true. And that's how we started the industry back in the 1960s. The idea of talking to a CEO, and I love when I talk to a public company CEO, and I say, you're here today, where do you want to be five years from now? And I love the body language. They always move because no one ever asked them five years from now. They want to know next quarter if they're lucky.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Static model, some computer run, they're static basically. We're more interested in how do you make the business better? What can you do? And there's so many factors that will play a role in making a company better or to impact your returns. If you own it for long enough time, you can improve the supply chain. You can improve pricing. And because we either control the company or have a very large say in it, we're not sitting on the sidelines and say, well, we hope the stock market will take it up or we hope this management team will know. We're going to work with the management to improve it. And there's a big difference between doing that and just being an investor in the stock market. So in downturns, that's opportunity. That's really what we're looking for.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Any fool can make an investment. That's easy just pay enough. The harder part is what do you do to create value? And that's our focus, like a laser. So I like to think of corporations very much as an evolving entity. They change. Think of a movie. What is a movie? Well, a movie is made up of a series of still photos. And you as a director of the movie can make it go any which way you want. Well, that's a little bit of how we invest. If we are able to take control of a company or even have a very large position in the company and work with the management team, can we make that business a better business? And that's really our focus. What do we need to focus on to make it a better business? Too many people, unfortunately, are focused on one still photo in that movie. I like to think about ah possibility. Where could we take this? What could we do? And so we try to train our people to think about not just looking at a”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“That's not what we do at KCAR. So there's a big difference in how you think about investing. The other thing is a lot of times when you're in a downturn, you see cracks in companies. You see that things aren't quite as good as what a strong economy and a strong market will mask. And so all of a sudden you look at it and say, well, there's opportunity here. So we're always trying to find a KKR is what are the opportunities? We say don't congratulate as we make an investment.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“I can't tell you when, why, but it just does, okay? And there's lots of reasons. So be ready, okay? If you think we're going into a bad downturn, just be prepared. Okay, don't sit there and say, wow, where did this come from? You've got to prepare yourself. As I said, we think an increments of five to ten years when we're making investments. There's a big difference than whether I'm trying to pick a stock that's going to go up in the next five minutes”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Markets open, focus on ripping costs out of the company as fast as you can during this time. Focus on having empathy for the employees and for the management team at the company and talk to them because everyone is afraid. There's uncertainty right now. And at the same time, we said, be ready for when we come out of this. We don't know if it's going to be one year, three years, five years, but be ready because when we come out, it reminded us of 1982, when we'd come out of a very long period of very high inflation, inflation with rates over 20% for the banks. And 1982 was an unbelievable year. And we didn't have a lot of money then as a firm, but whatever we had, we dumped in and we looked pretty good. And so we did the same thing coming out of the global finance crisis. Don't forget, everything that goes up comes down and everything is down will come back up at some point.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“So, this is a really important question. Everybody looks smart when markets are going up. Just ride the wave and you'll do just fine. The key for a good investor is how do they do in these downturns? George's view, in my view, has always been lean in. So let me give you an example. The global financial crisis. None of us at KKR, and I'm not sure Goldman Sachs had ever seen anything as severe as what we went through in the global downturn in 2008 and 2009 period. We didn't know whether the financial industry was going to survive. We know banks would survive. We didn't know if KKR was going to survive. But the message that George and I kept telling everyone, because everyone had fear at that time, is focus on what you can control. Focus on your companies. You can control those. There's noise in the system. There's not a lot you can do about that, but just focus on getting your debt down as fast as you can.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“We thrive at daycare on uncertainty. We like the time when markets are out of kilter because we invest around the world. By doing that, we have the ability to lean in where we see a part of the market that happens to be very strong.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“It used to be you could have a 60 40 kind of portfolio with stocks and bonds. And if bonds were going up, stocks would typically go down and so forth. And so today you don't have that. You have them both are struggling right now. Stocks are down. I think over the next 12 months, you're going to see the higher interest rates really take hold so far. Employment has stayed actually more robust than most people thought that it would. I think you're going to start to see some of that coming into play where there'll be more layoffs going forward. Technology is now starting to play a bigger role than before with AI and other things that's early, very early, but still will play a role. And you're seeing that coming into companies thinking about do I need people that are doing a lot of repetitive processes and so forth in a company? And so there's just uncertainty everywhere. Now, usually, and this is no exception.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Ties together much more today than it probably ever has. It used to be years ago you could only have to worry about the US because that's really where you invested. Most companies weren't as international as they are today. It all ties together. Currencies tied together and so on. So today I would say I think growth is going to be slower than we think. There's still a lot of savings on the sideline. You know, when I talk to heads of different banks who have a lot of retail capital sitting in their custodial accounts, and I'll say how much is in cash today, and it's up to about 25%. And I said typically what would”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Know it's really strange. God gave me an eighth sense or something. So I've always had a pretty good feel for where I thought the economy is going and where it is. I don't know where it's going. That's frightening. No, the one thing I will say is I think inflation stays much higher longer than most people think. Therefore, I think interest rates will stay higher longer than all of us had hoped for. I think that you have so much uncertainty in the world now that whether it be the Middle East situation, whether it's Russia, Ukraine situation, whether it's China and Taiwan, there's just a lot of uncertainty in a lot of places in the world today. And we are a global investor. So all of this.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“One men shows and they did not want to go to other meetings to help anybody. We fired them because you'll ruin the place if you let that continue and we could not let that kind of behavior continue.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Particularly for senior people. And that is in no particular order one is management leadership, two is commercial success, three is culture and values, and four is D&I. And we put D&I in last year because it's a very important part of what KCAR is all about, its diversity and inclusion. We have a whole team now that focuses on this. We talk about it constantly. And so all of this together comes into the mix in how we evaluate people, how we promote people. And again, it's on this team effort, this team approach that has worked so well for KKR for all these years. But you must talk about it. And people know, well, I'm not going to get promoted if I don't live by the culture. And we've had people at the firm made us a lot of money, could not live by our culture and values. They basically were...”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Of our senior advisors, George Fisher, who'd been the CEO at Kodak and Motorola, came up to me. And he said, that was fantastic, Henry. He said, now do it again. I said, what do you mean? I just did it. He said, no, no, not now. You're going to have to talk about it constantly. Nobody's going to get it the first time. And he said, I thought you spelled it out extremely well, but you've got to talk about it. Don't forget, they're not going to get it the first time. They probably won't get it the second time or the third time. And you're bringing in new people. So you've got to keep talking about this. And that's exactly what we've done for probably the last 20-odd years. We talk about it constantly. It's on our website. It's internal. And in addition to that, we compensate people and promote people based upon can they live by our culture and values. So we have basically four buckets that we measure people in at midyear and it begin at the end of the year for both pay and for promotion.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Out, all we had was carried interest and fee income. You said, I'll be on a plane tomorrow if I can be helpful because everyone knew they were going to participate. And we didn't differentiate somebody brought this in and they didn't bring that in, so what. So really as a team effort. Fast forward 47 years. We have exactly the same culture. And it's interesting. I'll tell you a story we were having maybe 25 years ago with one of our firm meetings. And I was thinking about what did I want to talk about at that firm meeting. And I started thinking that maybe I would talk about our culture and values because we never really talked about it. George and I knew what it was. We hired people that understood what it was, which was a team effort. And so I spelled it out. I wrote it out over a weekend. I sent it out to George. I said, you think I've captured this? He said, yes. And then I printed it up. I put the paper on everybody's chair at the meeting and I spoke about it. When I finished, one of”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“So, maybe a good way to explain that is how did we start? The second conversation that Jerry Colbert, George Roberts, and I had in 1976 was what kind of culture and value system did we want to have? Now, we came from Bear Stearns, which was very much an eat what you kill culture, and we did not like that. That wasn't what we wanted. We wanted a culture where everybody participated in everything it did. And the reason we wanted that kind of culture, we said, we'll get much more out of everybody. If everyone was running around and said, that's my idea, or that's my deal, and that's how they really thought about it, then what you would end up with is no one helping each other. If I called you, Allison and you had some expertise in a particular area and it was an eat what you killed, you'd say, look, I'm not going to really get paid for this. Gee, I'd like to help you, Henry, but I'm too busy. Whereas if everybody gets to participate in those days when we started.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Helping them understand KKR, our philosophy, our mission, our culture, et cetera. And so I like doing that. And then they have me calling on CEOs, which I've always done, and that I like doing. So that's really where George and I are spending our time today. And we keep saying, look, tell us where you want us to be helpful to you, Joe and Scott, and use us as you feel we can be useful to you. You're running the firm. We're not running the firm today.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“And it's fine. It's what I've done my whole career, and I enjoy that. And I guess you can't take that away from the old boy. So I want to just be helpful. I'm off to Europe again. I think I can't tell you how many times, but I must have gone already this year about eight times to Europe. I'm off to Europe tonight again, and I've got all sorts of meetings in London, Paris, Barcelona, and Madrid. So that's all part of what I do. I spend time now mentoring a lot of our younger people, which I really enjoy doing. George does the same. We both spend time trying to bring business into the firm. We spend a lot of time on a new area that we all came up with, and that's a democratized product, which means that we're enabling a retail investor to invest in the KCR products just like an institutional investor has been able to do for years. And we've set that up. So I do a lot of fireside chats meeting with RIAs.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“We don't have to do those now, although we have the final say on the top people of promotions. And George and I still have the final say on compensation. But it's really up to Joe and Scott to come to us with their recommendations of what they think is the right thing for the firm. As we spend more time now doing what we want to do, I'm still traveling as much as ever, giving an example of quote-unquote my retirement. I went to India because they wanted me to come to the world.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“Well, George and I do say we got promoted. It took 45 years. We're slow, and so we got there. And so that couldn't be happier. Number one, we feel both of us very strongly. We talk a lot about this, that the firm is in really good hands, probably as good positioning as we've ever seen. Keep in mind, both of us got promoted at the same time. And as we both say, we're now doing a lot of things we actually like to do. And we don't have to worry if the pipes leak. So what we do worry about...”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT
“We've done the same thing in some of our other business. Now, we do have soul heads in some areas. And in other areas where we think we'll do better covering more ground if we have dual heads, that's what we've done. And it's worked very well. The thing I find is the hardest part at the early stages is that they're feeling each other out, people, always. And they want to do everything together because, again, to come back to, they're in it together. They know they're in it together. They don't want to upset the other person. And it's very hard for any one of them to make a decision on their own. Over time you learn, okay, you handle this part, I'll handle that part. And that's really what George and I did over a long period of time.”
2024-01-05 · Goldman Sachs Exchanges · KKR’s Henry Kravis on private equity, culture, and global markets · IDENTIFIED FROM THE TRANSCRIPT