King of Capital: The Remarkable Rise, Fall, and Rise Again of Steve Schwarzman and Blackstone

KING OF CAPITAL: The Remarkable Rise, Fall, and Rise Again of Steve Schwarzman and Blackstone tells how how Schwarzman and his co-founder Pete Peterson, starting with just one secretary in 1985, built a powerhouse that weathered the financial crisis successfully even as other institutions crumbled.

The book recounts Blackstone’s evolution through fits and starts, disastrous early investments and internal clashes. It not only reveals the personalities behind the firm but also the larger forces at work in the corporate and financial worlds that transformed private equity from a handful of upstart investment boutiques in the 1970s and 1980s into a mainstay of the financial world, backed by billions from public pension funds and other institutional investors.

Today, the book argues, Schwarzman and his counterparts represent a new breed of capitalist, a cross between the great bankers and corporate chieftains. Like banks, their firms provide capital, but unlike banks, they take control of their companies. Like sprawling global corporations, their businesses are diverse. But unlike corporations, their portfolios of businesses change year to year. Moreover, because they buy companies and sell them a few years later, they exert an outsized influence on the economy and the markets.

This book challenges the conventional wisdom that private equity firms are “strippers and flippers” that loot companies of their best assets and leave them hobbled. Instead, it contends, private equity provides crucial capital and a unique, transitional form of ownership that in many case allows companies to undertake necessary changes.

But first and foremost it’s a story about a company and the people who built it.