Recently, Fortune's senior correspondent, Shawn Tully, delved into the inner workings of Apollo Global Management (APO). He spent valuable time at the Manhattan offices, gaining insights from CEO Marc Rowan, affectionately known as "the professor" within Apollo for his unique perspective. Rowan, a slight figure in an open-collared white shirt, outlined his strategic vision for the future of investments.
Tully's meeting with Rowan took place in Rowan's preferred booth, a bustling spot within Apollo's headquarters. To reach this spot, Rowan descended from the trading floor above, where he had assumed leadership as the pandemic unfolded in early 2021. It was a stark contrast to his predecessor, Leon Black, who occupied a lavish 42nd-floor suite adorned with antique firearms and priceless Impressionist paintings. Black's resignation amid a scandal marked a turning point, with Rowan opting for a more modest office space.
Tully's primary focus was on Apollo's evolving business model, which has seen significant changes since Rowan took the helm. One critical aspect of this transformation is Rowan's deep-rooted expertise in insurance.
Rowan's journey into this specialized field began during his MBA studies at the Wharton School in the early 1980s, where he was assigned an advisor from the actuarial sciences department. Initially finding the subject less than thrilling, little did he know that this knowledge would become a game-changer. When Rowan, along with Leon Black and Josh Harris, founded Apollo, their maiden deal involved rescuing a failing insurer called Executive Life. Rowan's expertise in insurance risks proved invaluable in turning this venture into a profitable success.
This initial triumph paved the way for the creation of insurer Athene, as Rowan capitalized on opportunities during the Great Financial Crisis. Upon becoming sole CEO, he swiftly merged Athene with Apollo, altering the Apollo model substantially. Today, Apollo closely resembles insurers like Mass Mutual, a departure from its previous peers such as Blackstone and Carlyle. The Athene merger brought an impressive $258 billion in capital onto Apollo's books, alongside over $200 billion in annuity liabilities payable to policyholders.
While these changes have introduced more significant risks, they also promise substantial rewards. Rowan is directing Athene's profits into the burgeoning private debt field and has a vision of reaching $1 trillion AUM by 2026. Investment Disclosure:
The information provided in this article is for informational purposes only and does not constitute financial or investment advice, a recommendation, or an offer to buy or sell any securities or financial instruments. Apollo Global Management, its CEO Marc Rowan, or related entities may be involved in various investment activities discussed in this article. Investments in financial markets involve risks, including potential loss of principal. Readers should consult with a qualified financial advisor or conduct their research before making any investment decisions.