We’ve certainly seen some wonderful artists pass away here at the beginning of 2016, including Eagles co-founder Glenn Frey and iconic rock star David Bowie. Both artists contributed to what is known as the “soundtrack of our lives.” Whether singing along to “Hotel California” every time it begins on the car radio or wondering what “Major Tom” was really thinking, it’s hard to see people who have brought so much to our lives move on.
Though it may seem like a stretch, the arcs of these two musicians’ careers present an opportunity to reflect on how they can apply to our own industry, certainly in terms of investment management and strategy. And it’s not as much of a stretch as you may think.
Both of these men came up through the music scene in the late 1960s and early 1970s, one of the most creative and dynamic times in modern music history. Frey hung out in Southern California and helped create the easy listening formula that still resonates today while Bowie came up through the ranks of the British punk and glam rock era.
In other words, there was no actual formula for popular music making at the time. Much like the early commercial real estate investment management era, there wasn’t any direct path to success. So much of the process was learning as you go because there weren’t any prior metrics to go on.
The Eagles created some of the most memorable music from this era such that they have the greatest-selling album of the 20th century: The Very Best Of. With hits ranging from “Take It Easy” to “Hotel California,” probably not a day goes by without you hearing a song from this collection.
As huge as The Eagles became, it is doubtful the organizing principle of the group was to become so huge. Most likely, they started out as young musicians and songwriters with the idea of performing, getting a record deal and making some money.
What transpired is that, in many ways, they became the biggest band of their time, and this still continues to pay dividends. Bringing this to our corner of the world, when Steve Schwartzman and Peter Peterson founded The Blackstone Group in 1985, they didn’t even have a real estate fund — hard to credit, isn’t it? Blackstone’s first real estate entity was launched in 1994 with a total capital raise of $400 million. And no discussion is necessary about how large the firm is now.
On the other side, we have David Bowie, whose musical career arc resembles one that is more like an emerging manager. While he was the talented composer of such classics as “Changes,” “Space Oddity,” “Ziggy Stardust” and “Heroes,” it never seemed that he was focused on becoming the biggest on the planet. Bowie had an uncanny instinct for finding new avenues to bring music to the world, but this also kept him on the “emerging” track over and over again. As successful as he was, his music was always a nod to something for a future sound. He didn’t remain connected to a particular path and favored looking for a new strategy with which to bring his talents forward.
This is not unlike some of the very successful investment managers who develop new strategies, and this has often brought forth some of the most successful fund managers as well.
Whether we took the changes and turned to face the strange, both of these gifted musicians made it with the long run. And they will be sorely missed.
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Jonathan Schein is senior vice president, managing director of business development, at Institutional Real Estate, Inc.
