Markets Magazine | The Big Take

Wall Street’s New Money Is Shaking Up the Ranks of the Superwealthy

To be sure, some of these finance executives have labored for decades out of the limelight, laying the groundwork for their bonanzas. In terms of demographics, they’re not a diverse bunch. All are men. All but two are in their 50s and 60s. Thirteen attended Ivy League schools; only five, public universities. And many share one traditional Wall Street pedigree: They cut their teeth during the 1980s rise of junk bonds before the 1990 collapse of Michael Milken’s Drexel Burnham Lambert. These credit mavens then created their own leveraged buyout houses, most notably Apollo Global Management Inc., which are now shifting most of their money toward private credit and other lending—and catapulting those who specialized in that field to the top of our list. These investments are also central to the insurers some have built within their own firms.

We singled out companies where we could determine that most of their business comes from private credit. That eliminated Blackstone, Brookfield, KKR and some others; though they’re major forces in private credit, it’s not the majority of the business. Our tally, which reflects valuations as of Jan. 28, also doesn’t include executives who no longer have current roles at com­panies. This list is by no means exhaustive. We’ll surely be adding more private credit billionaires in the years to come.

Ares Management Corp., founded 28 years ago, may be the OG of private credit. But the sector’s boom has made it seem like the New New Thing. The value of its publicly traded stock has almost tripled since the start of 2022, raising Ares’ market value to more than $60 billion. That performance helped cement four senior executives’ membership in the ­multi­billion-dollar club: Tony Ressler (1), Michael Arougheti (7), David Kaplan (9) and Bennett Rosenthal (10). Ares tied with the newcomer Blue Owl Capital for the most private credit billionaires on our list.

Ares’ founders are among those whose Wall Street careers date to Milken’s Drexel. There, Ressler worked alongside his brother-in-law Leon Black. Ressler and fellow Drexel alumnus John Kissick joined Black when he co-founded an upstart PE firm, Apollo. Ressler and Kissick established Ares in 1997, because they saw the future of private credit. (Kissick died last year at 82.) Like the founders of Apollo, they chose to name their firm after a powerful figure in Greek mythology: Ares, the god of war. Rosenthal, a leveraged finance specialist at Merrill Lynch & Co., signed on a year later; he’s currently chairman of private equity. Over the next few years, Kaplan, another former Apollonian, and Arougheti, who worked for Royal Bank of Canada, came aboard.

In 2014, Los Angeles-based Ares went public via a listing on the New York Stock Exchange. Along with its direct lending business, it had acquired more than 20 com­panies, including luggage maker Samsonite Corp. and luxury retailer Neiman Marcus Group Inc. Since then, its stock has returned more than 1,500%.

The top brass have been diversifying their fortunes and interests. Because he dates to Ares’ beginning, Ressler became a billionaire more than a decade ago and clocks in at No. 1 on our list, with a $13.8 billion fortune. Also the majority owner of the NBA’s Atlanta Hawks, Ressler is still the largest individual owner of Ares, with a 17% interest worth $11 billion. Arougheti (Ares’ president and chief executive officer), Kaplan (a director and partner and the board chairman of Cedars-­Sinai Medical Center in Los Angeles) and Rosenthal (a director and partner and the managing owner of Major League Soccer’s Los Angeles Football Club) have ramped up their stock sales through trading plans, which involve regularly scheduled unloading of shares. In all they’ve sold stock worth more than $300 million over the past two years, according to data compiled by Bloomberg. (The trio, combined, still own 9% of the company.)

Within the next three years, Ares plans to almost double its current assets under management, to more than $750 billion. The company is counting on sustained demand for credit, which makes up about 70% of its business. In December, Arougheti told investors at the Goldman Sachs US Financial Services Conference that he’s confident Ares will retain its perch. “It is not coincidental that the larger are getting larger, because they’re actually creating real competitive advantage in the market,” he said.

Apollo is still best known for its leveraged buyouts of marquee companies such as Harrah’s Entertainment, Vail Resorts and Samsonite. But, in one of the most striking demonstrations of what’s hot on Wall Street these days, credit now makes up the vast majority of its $751 billion under management.

Apollo continues to cater to A-listers—big corporate borrowers such as AT&T, Intel and SoftBank Group—along with the smaller and often less creditworthy companies that make up most of the private debt market. Co-founder and CEO Marc Rowan (2) drove the firm’s shift toward private credit through Apollo’s purchase of an insurance company, Athene Holding Ltd., which gave the investment firm a ready source of capital. Athene’s premiums can be invested in private credit.

After working at Milken’s Drexel, Rowan, Black and Josh Harris founded Apollo in 1990. Only Rowan remains. In 2021, Black stepped down after revelations about his payments to convicted sex offender Jeffrey Epstein for financial and tax advice. (Black has denied any impropriety.) That year, Rowan succeeded Black as CEO and Harris then left to found his own firm. During Rowan’s tenure, Apollo’s market capitalization has soared by more than 3 ½ times, to about $95 billion. His 6% ownership interest makes up most of his wealth.

Rowan owns Long Island restaurants, including Duryea’s in Montauk and Orient Point and Lulu Kitchen & Bar in Sag Harbor. His family office, RWN Management, has also put his money in credit, equity, real estate, agriculture and energy investments. In November he traveled to Mar-a-Lago to interview for the position of US Treasury secretary before then-­President-elect Donald Trump offered the job to hedge funder Scott Bessent.

Apollo’s second private credit billionaire on the list, Jim Belardi (15), has run Athene since its founding as CEO, chairman and chief investment officer. The third, co-president Scott Kleinman (16), joined Apollo in 1996 and was formerly its lead partner for private equity. The company is pushing to change federal regulations that keep private assets from inclusion in 401(k)s—in part, to protect unsophisticated investors from their often opaque strategies and high fees, the kind that helped Apollo mint so many billionaires in the first place. Rowan says regular folk would benefit from the returns and diversification of private markets. “In the US we have between $12 trillion and $13 trillion in 401(k) plans,” Rowan said at Apollo’s investor day in October. “What are they invested in? They are invested in daily liquid index funds, mostly the S&P 500, for 50 years. Why? We don’t know.”

In 2007, Scott Kapnick (3), a Goldman Sachs partner, left the firm to start a specialized credit business at JPMorgan Chase & Co.’s Highbridge Capital Management. The division, called Highbridge Principal Strategies, focused on junior debt and hybrid instruments that combine features of credit and equity. He brought along two other Goldman alums, Scot French (12) and Mike Patterson (13).

Tighter federal regulation after the 2008 financial crisis made it tougher for JPMorgan to hold on to the credit unit. In 2016, Patterson, French, Kapnick and other principals and employees bought HPS for about $1 billion. “You’re seeing the rebuilding of Western capital markets beyond the banking system,” Kapnick told Bloomberg in a 2023 interview. With its AUM growing from $34 billion in 2016 to $148 billion in September 2024, HPS seemed headed for an IPO.

But in December, BlackRock, the world’s largest money manager, known for its low-cost index-tracking funds, bought HPS for $12 billion, part of an acquisition tear to expand its business into the more lucrative, fast-­growing private markets. It meant a huge payday for the three top executives, who owned about 60% of HPS: CEO Kapnick; Patterson, who leads direct lending to companies; and French, who oversees ­mezzanine debt and similar lending.

Working in private equity in the 1990s, Lawrence (4) and David Golub (5) shared a frustration: It was difficult to secure financing for buyout deals from a single source rather than a hodgepodge of lenders. The brothers ended up becoming that one source. Their firm, Golub Capital in New York, typically lends to companies with annual earnings from $20 million to $100 million, too small to borrow in the junk-bond market.

The Golubs’ parents had science backgrounds. Their father was a physician; their mother, a psychologist. Lawrence, fulfilling his premed requirements as a Harvard ­undergraduate, initially followed in their footsteps before shifting to business. (He has three Harvard degrees: a bachelor’s, an MBA and a J.D.)

Lawrence, 65, founded Golub Capital in 1994 after starting his career at boutique US investment bank Allen & Co. and later becoming a managing director at rival firm Wasserstein Perella. David, 62—also a Harvard alum, but with an MBA from Stanford University—a former executive at US private equity firm Centre Partners, joined almost a decade later. He’s now president of the firm, which manages $75 billion.

The Golub brothers have repeat private equity customers. Over the past decade, they have done more than 40 deals with PE firm Thoma Bravo LLC—including last year’s roughly $400 million leveraged buyout of German investor relations and compliance services company EQS Group AG. “Everybody and their brother wants to be in private credit,” David Golub told the Bordeaux Blend investing podcast last year. “But we’re the only brothers who’ve been doing it for 20 years.”

Blue Owl Capital epitomizes the meteoric rise of private credit. Since its public listing in 2021, its shares have more than doubled, achieving a market value of almost $40 billion. As a result, Blue Owl has four private credit billionaires on our list, tied with Ares for the most from a single firm: founders Doug Ostrover (6), Marc Lipschultz (8), Michael Rees (11) and Craig Packer (18). As a group, they own 17% of Blue Owl, worth $6.8 billion.

They had quit some of Wall Street’s biggest firms, lighting out on their own to make the most of the private credit gold rush. Ostrover came from private equity giant Blackstone, which had already made him a fortune. In 2005 it bought GSO Capital Partners, the credit-focused hedge fund he co-founded, for more than $1 billion. Lipschultz had run KKR & Co.’s energy and infrastructure business. Packer was the former co-head of leveraged finance at Goldman Sachs Group Inc.’s Americas division. Together they founded Owl Rock Capital in 2016. Owl Rock specialized in lending to medium-size companies, including borrowers in the technology industry.

The fourth founder of Blue Owl, Rees, a former Lehman Brothers banker, came from outside the world of credit investing. At Neuberger Berman Group LLC, he’d built Dyal Capital Partners, which made minority investments in other money managers. Owl Rock and Dyal merged to form Blue Owl, through a 2021 going-public transaction via a special purpose acquisition company, or SPAC, an alternative to a traditional IPO.

Buying other money managers, including some in private credit, and rolling them into Blue Owl has helped the firm offer clients other investment approaches. In 2024 alone, Blue Owl snapped up commercial mortgage investor Prima Capital Advisors, alternative credit manager Atalaya Capital Management, insurance services firm Kuvare Asset Management and digital infrastructure specialist IPI Partners.

Blue Owl has an unusually high profile for a young company, with only $235 billion under management at the end of 2024’s third quarter. (About half that is in credit­-related investments.) Household names such as BlackRock, Fidelity and Vanguard oversee trillions. New York-based Blue Owl has been snapping up space in Manhattan’s iconic Seagram Building. It also owns a minority stake in the NBA’s Phoenix Suns (sports investing is another emerging focus), and it recently started sponsoring dozens of tennis players competing in Grand Slam tournaments, the sport’s most elite competitions. Last year, Ostrover and Lipschultz paired up to buy a stake in the Tampa Bay Lightning NHL team.

Building a brand is important, because the rest of Wall Street, including the firms these executives left, is piling into private credit, too. In December, Lipschultz told the Goldman Sachs US Financial Services Conference that Blue Owl has an edge. “There are plenty of people who have tried and failed to be in direct lending,” he said. “Scale, intensity and credibility of established relationships is not only critical. I would say, irreplaceable.”

In 2021 investment firm T. Rowe Price Group Inc., whose mutual funds are a fixture in many retirement plans, bought Oak Hill Advisors LP for $3.3 billion. (The buyer will pay an additional $900 million “earn-out” that begins this year if the business meets revenue targets.) Oak Hill’s sale helped land co-founder Glenn August (14), a Harvard MBA and trustee of the Mount Sinai Medical Center and New York private school Horace Mann, on our list. He joined T. Rowe Price’s board, and his 2.4 million shares make him one of the money manager’s biggest shareholders, filings show. That, along with the more than $1 billion in cash T. Rowe Price paid for his stake, according to the Bloomberg Billionaires Index, earned him a spot.

Cliffwater LLC’s Stephen Nesbitt (17) literally wrote the book on private credit—Private Debt: Opportunities in Corporate Direct Lending (Wiley Finance, 2019). Nesbitt’s academic approach has shaped Cliffwater, which regularly publishes alternative markets research with a focus on private credit.

Cliffwater started off in Los Angeles in 2004 advising institutions and helping high-net-worth individuals select managers and build portfolios in private capital and other alternative investments. In 2015, Nesbitt created the Cliffwater Direct Lending Index to measure performance in the private credit market. A few years later, he began to offer his own funds. He doesn’t originate loans but invests alongside a variety of managers who do. As of November, the firm oversaw $33 billion and offers advice to clients holding $85 billion.

In 2023, private equity firm TA Associates in Boston invested in Cliffwater in a deal that valued it at about $1 billion. Nesbitt and other employees own about half of Cliffwater. He makes our list thanks to the firm’s growth, the cash he got in the deal and his own investments in Cliffwater funds.

Maloney, based in New York, and Stupples, in London, cover wealth for Bloomberg.

—With Sonali Basak, Kat Hidalgo, Allison McNeely and Davide Scigliuzzo