Inside Goldman Sachs’ Alternatives Playbook (w/ Kristin Olson) | #621

0:00Welcome to the Metfavor Show, where the focus is on helping you grow and preserve your wealth. Join us as we discuss the craft of investing, and uncover new and profitable ideas, all to help you grow wealthier and wiser. Better investing starts here. Metfavor is the co-founder and chief investment officer at Cambrian Investment Management. Due to industry regulations, he will not discuss any of Cambrian funds on this podcast. All opinions expressed by podcast participants are solely their own opinions and do not reflect the opinion of Cambrian Investment Management or its affiliates. For more information, visit Cambria Investment Stockholm. Manufacturers have historically kept low correlations to both stocks and bonds, however, many of these strategies can be complex, opaque, and difficult to explain to clients. What if you could invest in the core ideas behind managers, but implement them in a transparent, cost-effective, and simple way? Join the Alpha Architect team live on March 26th to discuss how the Alpha Architect high inflation and deflation ETF, ticker symbol, hide, H-A-D-E, may help investors build more

1:02robust, evidence-based portfolios with trend-falling concepts that are accessible, transparent, and easy to understand. Use the link in the show notes to register. Welcome back, everybody. Today's guest is Kristen Olsen. Kristen is global head of alternatives for wealth at Goldman Sachs, was named to the firm's management committee earlier this year. In her role, she oversees the global alternatives platform and alternative products strategy across wealth, client businesses. Last year, she was named one of the 100 most influential women in U.S. finance by parents. She started her career at Goldman in 1998. Kristen, welcome the show. Thank you, guys. How many of you, ma'am? 98. That was a party. Tell me, do you remember what it was like starting back at Goldman and the peak of the boom times? Was it all just champagne and caviar and, you know, we have the hours? Well, as a lowly analyst in 1998, it was basically a lot of time spent in 85 broad starting out an investment banking in our financial institutions group, but fun to start at the

2:04firm when it was still a private company, pre-IPO, and incredible learning experience starting off in our investment banking franchise. We've had, I don't know, two, three, four, five people from Goldman on the show over the years, and I feel like I meet more lifers at Goldman than just about anywhere. Like, they put Chardonnay in the water founts or something. What is it about Goldman that, you know, it's kept you there for a rare, and then this day and age, a rare, a rare lifer? Like, we do have a lot of tenure and a lot of, a lot of lifers at Goldman's acts. I mean, look, I think it all comes down to the culture of the firm, right? It's a place where we all really love the people we work with who have the culture of the firm and it's kept us here for a really long time. I think for me, I'd also add, you know, working in such a dynamic area, such as alternative investments and wealth management and having seen kind of incredible evolution and change, right? It's been very dynamic over the last, you know, almost 28 years, and so that's also been something that's, that's kept me here for that long.

3:06You guys, Goldman, you got a pretty big biz. I think the all its platform over half a trillion, what does that mean? What does that encompass? When you say all its, because everything, it means something different to everybody. What's kind of under that umbrella is the main chunks? Yeah. So, yeah, we have over a 600 billion in alternatives AUM. I think it's something that, you know, maybe surprises a lot of people when they think about Goldman's acts. They don't necessarily think about the size and scale of our alternative investments franchise, you know, but we are one of the leading players. Yeah, and when you think about alternatives and I joke that when I started in alternatives, which, you know, I moved from investment bankings to alternatives in 2001, you know, the time we called it Spat them special investments. So, but you know, today when you think about alternatives, you talked to clients about it. That's a pretty broad term. And I generally start by saying, I think of anything that's not public equities or public fixed income and that can all kind of then fall into that alternatives bucket. And then when you look under the head of alternatives, it's private equity.

4:07It's real assets. So, real estate and infrastructure, it's private credit and it's hedge funds, right? And so, all of that kind of fits into the alternative investments bucket, but then you can drill down even further, right? So, if you look at private equity and you just spend time talking about that asset class, well, is it large buyout? Is it middle market? Is it growth equity? Is it venture rates? You know, it's a catch all term for a lot of different strategies that invest in essentially from those private private assets and frankly have a different liquidity profile and risk return profile than public assets. And not only that, I mean, if you compare back to when you got started, you know, you talk about it, the name's being different. Here we are in 2026. What does it look like from your standpoint and snowing New York? What's the viewpoint? What's been interesting is just the evolution of the asset class. And I think from my see what's been interesting is just to see kind of the secular shift from what had been an asset class that was primarily invested in by institutions that evolved pretty

5:10dramatically over the last five to 10 years and really over the last kind of five plus years to include a much broader section of individual investors, right? And so, you know, part of that is because if you thought about where we were 20 years ago, you had institutions starting on a journey, right? Of how do I get to 20, 30, 40 percent, whatever the number is in alternative investments? What happened, you know, over the last several years is they sort of, they were arrived, right? It took a long time, took decades to get there. And in this environment, their rate of growth in terms of allocating alternatives has slowed. And that's created the need, right, or the imperative for a lot of alternative asset managers to think about new sources of capital. And so that's kind of what's opened up the aperture for individual investors. So I think that's one of the big trends that we've seen right over the past decade plus. I think the other is what you're alluding to, which is, you know, from my seat, like, why is it important for individual investors to have access to alternatives?

6:10Is that dynamic that you just referenced? You have private companies valued at over a trillion dollars. You have companies waiting 10, 11, 12 years to go public. And what that means is that a lot of the growth that's happening that investors want to take advantage of and want to capitalize on is happening in the private markets more than the public markets in some cases. And so all of that is fueled sort of this desire for more access to private markets. And then there's a lot of reasons why companies are less interested in going public sooner, right, and being handcuffed by kind of the requirements of being a public company and quarterly reporting. And so all of that just pushed more of the economy and economic growth into private hands. That being said, private markets are still, you know, much smaller than the public markets. And there's a credible amount of opportunity to tap into. Let's stick on private for a minute on the kind of this whole equity side. You made a good point where, you know, there's a pretty wide spectrum between all the way from start-up seed to,

7:14you know, these late-stage, SpaceX-style companies. You guys even acquired a VC firm, industry ventures for, I think, about a billy, not too long ago, who I think was a pioneer in some of these secondaries. Where is most of the interest coming from? You know, you look back in the day, I feel like a lot of the popularization that was formally institutional from things like Yale. As almost come full circle, as you see the headlines where Yale, you know, Yale trying to sell some of their stake. But you've seen a lot more interest from high net worth, from individuals. I think Robin Hood, by the time this is coming out, will have launched a close-in fund on the late-stage private, you know, space. What is the kind of spectrum of interest, spectrum of opportunity that you guys see on sort of all the way from, you know, that VC to late-stage? One of the tenets that we've always espoused is as you think about investing in alternatives, you want breath of diversification. And I always say this across a couple different vectors. So one, you want it across strategy, right? So you want all those different sub-assah classes with

8:15alternatives, and you want not just buy-out, you want venture growth, buy-out, you want the full spectrum. You want diversification by manager, right? So you want to have, you know, a portfolio of different GPs and partners that you're working with. And then you want diversification by vintage year, right? So you want to be investing, you know, in the closed-end world, kind of year in and year out. That being said, you know, from year to year, different strategies are going to come to the fore and be more in, you know, of interest or more timely than others. You know, I think there's a core part of your portfolio, as I said, you want to do year in and year out, right? That diversified core across everything. But for example, right now, a lot of interest in kind of venture and growth space to the point we were talking about earlier, so much innovation and growth that's happening and being turbocharged by what's happening in AI that investors are thinking, okay, how do I best get exposure to that? Well, private markets, right? Venture growth. I want to see good managers that

9:16have the access, right? That have the investing acumen to evaluate kind of new technologies and new businesses. And so I would say a lot of interest there. Overall, you know, fundraising for alternatives at large has been challenging over the last few years. And we can go into a lot of those dynamics. You know, part of that's just been a little bit of this stagnation in terms of distributions not coming back, right? And making it hard for private equity firms to go back out and fund raise. And so on the margin, I would say buy out fundraising has been down. But what's taken up the mantle have been things like secondaries. As you talk about full circle, you talked about Yale, a big part of where clients have been allocating on the alternative side has been secondary strategies because they were very fit for purpose for the environment we're in today, which is private equity firms are stuck with assets that are now going on kind of seven years in their portfolios. They need to find sources of liquidity for their clients and for their LPs. Secondary funds have the ability to step in and really capitalize on this current dynamic. And so you've had

10:19a lot of interest from clients investing secondary. So that that fundraising and deployment and interest in secondaries has gone way up. And then some of the newer alternative asset classes like infrastructure, right? Have seen a real pickup in interest and, you know, LP activity where people are saying, gosh, that's a sector I want to be invested in. And again, part of that driven by, you know, a lot of the infrastructure needs are currently be driven by some of our technology innovations, right? So whether it's more power that we need for data centers, right, data center construction, a lot of things like that are driving more renewed interest and infrastructure. So I think, you know, the alternatives interest can to used to grow, but under the hood, you know, traditional private equity, maybe down a bit in terms of what we've seen in terms of fundraising for those asset classes. But then that's been picked up with secondaries and infrastructure, you know, private credit, right? Have sort of taken up to the balance. Traditionally in sort of like the wealth management segment, how do they think about this? Do they tend to gravitate more towards funds? Do they tend to gravitate more towards individual

11:23names? And I imagine that's changing over time. But as I think about it, and I could be totally wrong. I feel like you've started to see a lot more interest in sort of the individual names, secondaries for whatever reason versus back in the day. I felt like people were more just like now just because it was so opaque, so hard to figure out. It wasn't that easy. Now you got half a dozen places, probably where you could at least try to find some liquidity. Is that accurate? Is that totally wrong? Yeah. Look, I think still for our clients on the well side, the core of their portfolio remains in funds, right? And I think that's because you want to outsource that expertise on investing in portfolio construction, right? And deal selection to kind of professional investors that do that, right? And so I think the core of the portfolio is still going to be in funds. But I think you're not wrong in that, you know, particularly respect to these kind of late-stage growth names on the tech side, there's been a healthy interest in appetite from individual investors to gain access to, you know, who they think are

12:26going to be kind of the marquee companies of tomorrow, right? That are currently private. And so you've seen a lot of interest in trying to tap into kind of the AI names, the large LLM, the SpaceX's of the world, right? To try to get exposure to those types of fast growing innovative companies. And, you know, some of that's through primary, right? Be able to participate in the primary rounds and some of it is providing liquidity in the second, you know, buying out secondaries. For those that are skeptical, what's your McDonald's analogy? I think the comment there is the massive proliferation in terms of the number of private equity funds that are out there, right? And the number of private equity backed business, private businesses out there, I think there's, you know, 12, 13,000, you know, sponsor back private companies out there. And I think, you know, on the skepticism side, it's right now can private equity continue to generate alpha, right? I think that's the question that people have, right? Because we're sitting at a moment where, you know, holding periods are extending, right? Generally, these private equity firms are

13:29investing in companies for three to five year holds. And as right now, I think that we're looking at kind of seven year holds and a lot of these, in a lot of these funds. How are they going to get liquidity? You know, and are they going to be able to generate outperformance or alpha relative to what you could have gotten by being in the public markets? And I think the thing that's a cute right now is if you're not picking good managers, right, that have the tools, the skill, you know, the origination to gender to drive alpha, over the last five years, you've been barely outperforming global equity markets. If you're in the average private equity portfolio. And that goes back to the thing that we think's paramount, which is how do you pick, you know, among those, you know, tens of thousands of private equity sponsors out there, how do you pick the consistently first and second quartile performers? Because if you do that, then over the last five years, you have received the alpha and you've been handsomely rewarded for being in private markets, right? I think we've been 600 basis points plus over global equity markets in terms of alpha

14:34in the top two quartiles of managers. But for all managers, you've barely outperform global equity markets. So I think the skepticism point right now is it's going to be harder for private equity firms in this cycle potentially, right, to drive that alpha. And to do that, you want to make sure you pick the top two quartiles of managers, right? We have a different, we have a different backdrop going forward than we've had over the last two decades, right? If you look at the kind of concerns, I feel like the word cloud headlines, you always see there's always concerns about returns come and go. The one that I feel like, you know, makes the big headlines always is liquidity where it's a manager that all of a sudden is just like, you know, puts down the gates, which to be clear, they often, or I should say they always probably announced or having their docs and said this is possible. But I feel like people always get surprised about it and then it makes headlines because people are like, Oh my gosh, this is restricted from investors, you know, withdrawing. So whether it's blue bow or blackstone back in the day with the B-read, is that something you get a decent amount of

15:37concern about from investors or pushback or do they kind of get it when you talk about kind of this private world? What are their main concerns today? Is it more macro? Yeah. So I would say kind of the big concern or the thing that we're looking at right now is this pivot or this evolution that's happened where, you know, historically, private markets, alternatives, was all in traditional closed-end draw-down funds, right? Capital calls, distributions, you sign up for 10 years and you go in eyes wide open knowing there is no liquidity, right? There's no on-demand liquidity. What's happened over the last five plus years has been the advent of all of these evergreen perpetual alternative vehicles, right? Lots of different names for them. Retail vehicles, you know, I made this comment. We made this comment a lot of times, you know, semi-liquid is a term that's used and we don't like that term because we don't like putting the word liquid in there because we think it may give people false comfort on the fact that really as powerful as are not liquid. And so I think the thing that,

16:40you know, we do what concern right now is you've just had this advent of all these new structures to allow people to tap into private assets with a modicum of liquidity, right? Stated quarter liquidity, but to your point, subject to gates. And that's kind of the big footnote that people need to be aware of. And I don't know that we've been fully tested yet on how individual investors are going to react when a gate gets turned up, right? We've lived through a couple of examples, right? I think BREED has managed through. We are at the moment watching what's happening on a lot of these evergreen credit vehicles. And I think the thing that's different to prior cycles with individual investor base and evergreen vehicles that have quarterly liquidity, supposedly, is sentiment can become a driver that can catapult more redemption. I think if you look at what's happening right now, look under the hood, some of these headlines aren't necessarily issues of they're not being enough liquidity to satisfy a 5% quarterly redemption. But they're being interpreted

17:42as there may be a problem going forward. And then you kind of create an issue where people want to rush to the door. So I think that we are very focused on education. And we want investors to go into these evergreen vehicles knowing that they should be in these for the long term. Yes, there may be the option every quarter for you to potentially which are your capital, but you should go in knowing that probably when you most want to take your capital out, it may not be available, right? Because that's when when the gate's going to go up. And frankly, part of that's for the right reasons, right? That it's a feature that they can gate so that they don't have to sell assets, gap down in prices at much lower valuations. And it also allows these managers to take advantage of what could be a very good opportunity to deploy, right? And so I think we do these laws features. We want to really educate clients that they need to be in these for the long term and that they really understand that that caveat that yes, there's liquidity on a quarterly basis, subject to 5% and subject to possible gaining. I think that makes a lot of sense. I think the trouble

18:46comes when it's an advisor that allocates to a client that may not know, which of course is their job they should and should that should never happen. But what's going to be really curious to see is not kind of these traditional vehicles, but ones you've started to see some really strange ones you've seen. I mentioned Robinhood, it's closed-in fund listeners. I'm curious. The interesting about closing funds is they can trade premiums to net asset value in discounts. And there's some that my favorite used to be the Cuba closed-in fund, which I think got closed down, which owned no Cuban stocks, by the way, but would regularly go to a 50% premium in discount. And so I mentioned Robinhood's doing one, but you got funds like DXYZ. You have the fund, the ETF that was owning a bunch of SpaceX and now even Baron funds, I think, has some that own privates that will be curious to see how these, in my mind, this mismatch of liquid, illiquid gets handled. Because you could see how there could be a lot of problems in some of these. So I'm curious listeners, put it in the

19:48show note links, so you think the Robinhood fund is going to hit a 25% premium or discount first. I imagine it'll do both, but I'm going premium first. I think the thing that everyone's been moaning about recently, at least the doomers, when you read a lot of the headlines that everyone's worried about, it's like this kind of gray cloud of doom on the horizon that everyone writes about is like this existential threat, which is private credit. Everyone's always worried about private credit. I mean, most people I feel like don't even really know what private credit is, but they're like, I'm worried about it. It's going to cause problems. Do you guys hear that? How do you think about that? Is that a big part of this all-twirled for y'all, or is it smaller than kind of the PE space? The private credit markets are a much bigger market than the private equity markets, and I think the reason why I wasn't sure which existential crisis you were going to elude to, but on private credit. I don't know if they know. They know it a crisis could be anything. Yeah, look, I think it's kind of what we're just talking about on private credit, which is,

20:52it's more about the structures that private credit has gone into that have a bit of an asset liability mismatch and are now subject to much more sentiment-related flows. You know, you referenced kind of blue out headlines, things like that, which can be driven by investor sentiment, causing people to run for redemption. I think our perspective on private credit is, and it will be interesting here, is over the last several years, you really haven't had much dispersion of return between managers. We may be entering into an environment now where you start to see dispersion, and that's going to go back to my earlier point about manager selection, which is, are you with a credit manager that has a really long track record through cycles and is picking high-quality credits that are going to withstand potential economic shocks and market shocks, and continue to be able to distribute their cover their interest expense and pay back a maturity. And I think you're going to find managers that are going to get through this quite well,

21:53but I think the concern people have is just dissentiment kind of potentially overtake that, and you still see redemptions even with strong managers. But we're interested to, from our perspective, to showcase outstanding credit selection, the vast amount of origination that we have to really be selective in the credits that we decide to back. And so I think this will be an interesting time to watch, kind of the dispersion of returns between managers. There was an old podcast, alum Mark Yusko, who used to have a quote where he did a lot of the allocating where he said, we want to give money to people that don't want our money. So the challenge, I feel like, how do you guys think about just selecting from this infinite sea, and you mentioned it's gotten bigger and bigger, and more managers doing due diligence, you got any special sauce and secrets to kind of share with us on this process, daunting process. I think that's why for an individual investor, we went back to funds versus single deals, right? I think we sort of start with the fun piece of it, and even on the fun piece of it,

22:57picking up, working within it, like a professional institution that can help you pick those managers, you know, part of it's getting the access, and then how do you do the diligence to figure out, are there things that drive return for those managers repeatable, right? Will they be consistently in those top two quartiles? I think the thing to frame it for you, we, so we have an external investing group that frankly just looks at all alternative investment managers outside of Goldman Sachs and constructs, you know, portfolios of private equity, private credit for our clients, and you might think about the size and scale of that organization, it's over 400 people to do that, right? And then when you think about how do you get down to that portfolio every year of let's say private equity managers, that group is meeting almost 700 managers a year to ultimately invest in a court portfolio of less than 10. So like when you think about how many managers you need to meet with, and then, you know, a very small percentage of those you actually need to diligence to get to a very small percentage of those that you actually invest in, it takes a real institutional effort to be able to kind of construct those portfolios and really do the work that allows you

24:02to feel confident that you're picking consistently first a second quartile managers. It's made a headache just thinking about that effort, it seems like a lot. We kind of covered two of the big chunks that I think people think of in private's world, but private's, you know, whether it's private equity, private credit, they probably look the most similar to traditional, just beta of equities and bonds and corporates. Let's talk about some of the weirder stuff, and you can take this any way you want. We can talk about hedge funds, manage futures, litigation finance, cap bonds, all the other alts on the menu. What are kind of some of the ones that are most interesting to you guys, the ones that y'all tend to allocate most to or think are pretty good in this part of the cycle? I guess the one, I don't know if I'd put in the weirder category, but I'd say the category that I think is hedge funds. So hedge funds has been a part of the alternative allocation for a long time, but I would say they've been out of, in many ways,

25:05have not been the focus of where we've been investing from an alternative's perspective. Part of that is for US wealth investors who are taxable. It's been hard on an after-tax basis to outperform in hedge funds, just because they're generally going to be all ordinary income, short-term capital gains, really tax inefficient, particularly for investors in also high state tax jurisdictions. So like very high bar. That being said, I think we're in an environment though where there may be more interesting factors for hedge funds to really drive interesting alpha. And I think we're starting to see that, right? hedge fund returns have been pretty interesting so far for the start of the year. And so I think you're probably going to see some green shoots in renewed interest from investors on looking at hedge fund managers as a way to drive alpha and drive, you know, hopefully uncorrelated returns. This, you know, return sharing that's uncorrelated to their public equity and their bond portfolio. So I think hedge funds will be something that to watch, you know, over this year in the coming cycle. hedge funds feel like so hot from

26:062000 decade, you know, where S&P kind of went sideways. And you've had this period in my goodness, I was thinking as you were talking about 20, 30 years, years peeling off here, you know, since 2009, which is going to be by the time this publishes probably almost what, 17 years from the bottom and in 2009, you know, that's a career for most of us. And that's been a period of S&P looking pretty bright and shiny compared to any hedge fund index, any type of all. It's like you didn't need it all. You just put it into SPY or the queues and took a nap for 10, 20 years. Are you seeing a kind of renewed interest? You guys mentioned you guys have some really great papers. One of which was talking about kind of survey and what the younger generation is doing. And maybe talk a little bit about the millennials and the youngins because in my head, when you said all, it's I was thinking, you know, stock X sneakers or trading cards, you know, Pokemon.

27:07Those are all for my son, yeah, for sure. Yeah, I wasn't thinking like a traditional. But there's an interest there. Can you explain what's up and why? So we did a survey. We went out to, you know, a thousand investors, a 25 plus over a million dollars of net worth just to sort of get a sense for the market on, you know, where their knowledge is on alternatives, what they're doing. And I think one of the interesting takeaways we had was millennials came back in that survey with saying they were 96% of them were familiar with Alts, which is just interesting because, you know, as we're sitting here trying to educate individual investors on alternatives, we're finding that people are still the very early part of the learning curve on Alts. But yet millennials are self-described in our survey, saying 96% are familiar with them. And they're very keen to invest in alternatives. And I think part of the reason for that is goes back to the conversation we're having about these very large transformational growth companies, tech companies that are private. That the millennials have watched, you know, evolve and sort of change of many cases their

28:10industry and change parts of the world. And so they want to be along for that. And so I think they feel much more comfortable and familiar, I guess, with alternatives because they're thinking about those types of investments. I think the other part that we're sort of, you know, maybe sort of reading from the survey was, you know, they also grew up in the shadow of the great financial crisis. And so potentially maybe less keen to have as much allocated to more traditional investment sources of equities and bonds than maybe the, you know, Gen X and the older generations. So we do see a lot of interest and, you know, self-professed familiarity with alternatives coming from the younger millennial generation. As far as traditional diversifiers, you know, hedge funds, obviously, means a lot of things. But are there any particular that you guys say, think, hey, this is what we think of when we think when either when it's hitting the fan, or if the S&P decides to go nowhere for a decade, these might be cool places to hang out or some opportunities that might be good, diverse fire. Yeah, you know, actually, so one of the things that I wanted to say earlier, can you talk, when you talk about sort of, you know, market,

29:12you know, post-financial crisis, that's, you know, equities have been hard to beat, right, you know, straight up into the right. But I actually think one of the hidden benefits of alternatives at large is the fact that they force you to stay the course because it's great that, you know, you've seen kind of that meteoric rise of the kind of the S&P over the last 17 years. But there are, you know, moves along the way and, you know, will investors stay the course, right? Because I think natural investing psychology, you tend to see that when markets draw down, investors tend to capitulate and oftentimes not get back into the market until the markets have already significantly corrected. And I think one of the diversifiers that we are very constructive on is just this idea of having a significant all-sportfolio, right, which for us for a moderate, ultra high net worth client could be as much as, you know, 27% of their portfolio and alternatives. And that portfolio at large is that diversifier because it's forcing you to stay the course, it's forcing to invest money when times feel bad. And so I think that one of the hidden benefits

30:15is the fact that like, there is no liquidity, right? You can't let your human psychology take over at any point. So I think that is one of the hidden diversifiers that why we are such big advocates of having a big alternatives portfolio. For an ultra high net worth client, it'll be that large, you know, and for a high net worth for it will be smaller. But still, that whole part of the portfolio is that long-term term diversifier. And then the other part is, you know, we talked a little bit about some of the growing areas under the hood of alternatives, one of those being, you know, infrastructure. When you think about times getting tough, what are some other areas to diversify into? You think about hard assets. You think about assets that have, you know, long-term contracts that escalate, you know, in line with inflation, right, so you have this inflation protection, you know, that are probably, you know, a lot of them are very essential types of infrastructure that are not correlated to GDP growth. So you have like different vectors of diversification and lack of correlation and infrastructure. And then you have a lot of interesting growth vectors that come into infrastructure,

31:17which I mentioned before, you know, that are being catalyzed by, you know, the infrastructure needs that are coming from AI and what we need to support a lot of the AI growth. As you were talking about that, I was thinking, it's funny on the word cloud over the years on what might kind of drift into the Alts Bucket or drift into just the macro conversation in general. You know, you certainly seen this phenomenal, precious metals run over the past couple of years, and depending on the vintage, you may crypto may enter the conversation. We've talked a lot about farmland investing on the podcast over the years, which is, you know, a very traditional, I mean, it's all T in a way and that it's hard to access on public assets, but it's like the least alty thing because you go back 150 years, it's like 90% of the people or farmers at some point. So it's, it's interesting to see what drifts in and out over time and the interest. And with always, of course, equities being kind of the, the ballast and bonds as well.

32:22Goldman's a global company, over half a trillion in this Alts world. How do you guys think about XUS? You know, is the opportunity to set either from a manager standpoint, from client standpoint. Oh, it's been a very US dominant period. US is two thirds of world market cap on equities. And in the last year, we started to see perhaps that shift a bit. How are you all thinking about the opportunity set outside our shores as well as client base, anything interesting there? Yeah, look, I mean, we are, we are certainly global firm, more global wealth business, we're global Alts business. You know, we have had a lot of bias towards kind of the U.S. just in terms of the incredible growth and resiliency we've seen kind of in the U.S. economy. But we also have large investing businesses focused on Europe and Asia and rest of world. I would say we are seeing some growing opportunities in Europe, particularly on the private equity side.

33:22And so, you know, we are focused a little bit more there. And then in Asia, you know, Japan is becoming, you know, an interesting place where clients are quite interested in investing. I'd say, you know, watching what's happening more broadly in Asia, you know, we've probably been on the margin, you know, a little bit underweight to China. And, you know, I think clients have been, you know, just given US-China relations have been, you know, a little reticent to deploy there. So I'd say we do skew overweight to the U.S., but obviously big investing businesses can rest of world as well. What else is on Kristen's brain as she looks out to the rest of 2026? What are you thinking about? What are you worried about? What's on your brain for the investing all twirled? I would say optimistic and hopeful for, you know, renewed capital markets activity, unlocking kind of more exits, distributions, you know, for clients that have large alternatives portfolios, right, that have been waiting for liquidity. I think we're hoping,

34:23you know, last year we saw, you know, a big pickup in exits, but dominated by much larger deals, right? So by dollar volume, big uptick, by deal count, actually not an uptick was actually down. But I think a lot of optimism around hoping for more unlock in terms of activity on distributions coming back to investors, and then obviously new deployment, right? Because a lot of these firms are sitting on a lot of dry powder that they've been waiting to put to work. So I think, you know, for 2026, you know, hopefully outlook is more activity in the private markets, more deal transactions by and selling. I think obviously can't, can't leave this podcast without talking about kind of the opportunities in AI, and obviously the, the threats of AI as an investor in the private markets, right? And so, you know, tremendous amount of interest from clients and investing behind different AI opportunities. At the same time, we see what's happening around software investing, and so you have the opposite side of it, which is, you know, concerns around how AI is going to

35:25potentially, you know, disintermediate and disrupt, you know, traditional software investing that was happening in the private markets. And so I think that we think about 2026, I think how AI is going to impact different industries in the private markets, and then on other hand, the opportunities to get behind investing in AI. You never know how much to put in some of these headlines, but I saw one today where as a financial institution talking about, do we even need associates anymore? So, does Kristen's job in 98 is that going to go the way the dodo bird? I mean, how fast is this going to happen? You know, is there a, Kristen 2000 bot that you guys are working on to do due diligence across 10,000 managers in the afternoon instead of 400 people? How y'all thinking about it over there? Yeah, no, no, we're spending a lot of time thinking about it. I mean, we have this one GS ethos, and right now we're applying that to thinking about, you know, how we use AI within the firm more broadly, how we think about it from an efficiency perspective. We're spending

36:26a lot of time thinking about it, you know, on your point about doing not have, you know, analysts and associates, I do think if you look at what AI can do, right, a lot of the job that I did in 1998 can probably be done, can be done much faster and more efficiently with AI, but then that leaves you with the, how do you train that analyst so that they can actually be the functioning VP and MD down the road if they never have to like get in the weeds and build that merger model, right? And so, you know, I think there's a lot of things we're going to have to work through in terms of what does that look like? You know, how do we have an apprenticeship culture, right, in a world where a lot of junior tasks could be done by AI? And then how do you have more senior people that are able to review, right, how do you have the right talent to review what the AI output is if they haven't been trained along the way? So I think these are kind of longer term things that we need to, that we need to think about, we're spending a lot of time, you know, looking at how we can use AI effectively and what it means for the culture and how we grow the firm

37:27over time. People want to learn more about what y'all are up to, what you're doing, any good place to go? Sure. So obviously, you know, as a client of Goldman Sachs, we spend a lot of time, you know, walking through everything that we're doing in the Alts world. We put out a lot of interesting research that you can find on some of our social channels and in other public forums. And then, you know, we've recently launched our GS Investment University, which is another great place where we're really focused on how do we provide alternatives education to advisors and to clients. And so GS Investment University would be another, another great place to get started. Listeners, on the idea of farm, we consistently feature Goldman that puts out some of the best research anywhere on this world. And you can find them in the archives, which we've now built out. I think it's going back to like 2022 at this point, but by the summer, should go back all the way to, I don't know, 2015, whenever we started that science, there's probably a lot of, a lot of Goldman in the archives. Chris and it's been a blessing. Thanks so much for joining us

38:28today. Thank you so much for having me, Rev. It's a pleasure. Podcast listeners, we'll post show notes to today's conversation at mebfavor.com, Fort slash podcast. If you love the show, if you hate it, shoot us feedback at the mebfavor Show.com, we love to read the reviews. Please review us on iTunes and subscribe to the show. Anywhere good podcasts are found. Thanks for listening, friends, and good investing. New medicines first, nearly three years faster. Five million Americans go to work because we make medicines here at home, and not relying on other countries keeps us safe. But China is racing to overtake us. Will we let them? Or will we choose to stay ahead? When America leads, America cures. Let's tell Washington to keep us in the lead. Learn how at americacures.com, paid for by pharma. Spring starts at the Home Depot, and we are bringing the heat to your backyard this season.

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