Alan Waxman - Building Sixth Street - Invest Like the Best with Patrick O'Shaughnessy Recap

Podcast: Invest Like the Best with Patrick O'Shaughnessy

Published: 2025-07-15

Duration: 1 hr 15 min

Summary

Alan Waxman shares insights from his journey in the finance world, detailing how he built Sixth Street as a flexible investment firm capable of navigating various asset classes and strategies. He emphasizes the importance of hiring the right people and developing a unique investment philosophy.

What Happened

In this episode, Patrick O'Shaughnessy talks with Alan Waxman, co-founder and CEO of Sixth Street, which boasts a remarkable $110 billion in assets under management. Alan reflects on his early career, including his time at Goldman Sachs' Special Situations Group, which he describes as the 'Navy SEALs of finance.' He emphasizes how this experience shaped his approach to investing, particularly in high-pressure situations that require quick decision-making and strategic flexibility.

One of the highlights of the discussion revolves around Sixth Street's distinctive investment strategies. Alan shares their successful investments in companies like Spotify and Airbnb during challenging market conditions, showcasing their ability to identify opportunities when others may hesitate. He also discusses innovative sports partnerships with renowned teams like Real Madrid and FC Barcelona, demonstrating Sixth Street's adaptability across various sectors. Additionally, Alan introduces the concept of their $30 billion ‘cow vehicle,’ which allows them to write substantial checks while aligning fund sizes with specific opportunities, thus maintaining operational efficiency.

The conversation further delves into the cultural aspects of Sixth Street, focusing on their hiring philosophy centered around finding individuals without egos. Alan explains how this ethos fosters a collaborative environment that enables a true multi-strategy approach. He also introduces the 'Face the Tiger' philosophy, which encourages the team to confront challenges head-on rather than avoid them. This mindset reflects the core values that underpin Sixth Street's operations, ensuring that they remain agile and responsive in a rapidly changing investment landscape.

Key Insights

Key Questions Answered

What is Alan Waxman's approach to investment?

Alan emphasizes the importance of flexibility and adaptability in investment strategies. He believes that having a go-anywhere, do-anything mandate allows Sixth Street to capitalize on opportunities across various asset classes and geographies. Alan's experience at Goldman Sachs instilled in him the need for quick decision-making in high-pressure situations, which continues to guide his approach today.

How did Sixth Street manage investments during market downturns?

Alan highlights several key investments during challenging times, notably in companies like Spotify and Airbnb. These investments demonstrate Sixth Street's ability to identify potential where others may see risk. Their strategy involves thorough analysis and a willingness to act decisively when opportunities arise, showcasing a proactive investment philosophy.

What innovative structures does Sixth Street use for investment?

One notable structure is the $30 billion cow vehicle, which enables Sixth Street to write large checks while keeping fund sizes aligned with specific investment opportunities. This flexibility allows them to optimize their investment approach and manage capital efficiently, ensuring that they can respond quickly to market dynamics.

What cultural philosophies guide Sixth Street's hiring practices?

Alan discusses the significance of hiring individuals without egos, which fosters a collaborative and innovative environment. This ethos helps create a culture where team members can share ideas freely and work together towards common goals, enhancing Sixth Street's ability to implement a multi-strategy approach effectively.

What does the 'Face the Tiger' philosophy mean?

The 'Face the Tiger' philosophy encourages team members at Sixth Street to confront challenges directly rather than shy away from them. Alan believes that this proactive mindset is crucial for navigating the complexities of the investment landscape, ensuring that the team remains resilient and focused on finding solutions to difficult problems.