A data acquisition too big to ignore

The world’s largest asset manager, BlackRock, just bought what appears to be the world’s most valuable analytics firm for data about private equity, Preqin.

- ARMINE YALNIZYAN

BlackRock — a publicly traded company with $10.5 trillion (U.S.) in assets under management — noted in its press release for its $3.2-billion purchase of Preqin that the market for information about private equity is growing by 12 per cent a year.

Pay attention. This deal is gigantic. It is also gigantically important. It could shape the future of ownership, and that could shape what you can and can’t afford to buy.

BlackRock CEO Larry Fink says data will be an important driver of “the democratization of all alternatives. And this acquisition is the ‘unlock.’ ”

“Alternatives” — investments that aren’t publicly traded stocks, bonds or currency — are the fastest-growing segment of asset management. We know little about the actual number of private deals and their true value, precisely because they are private; but based on what we know, the value of private markets is expected to reach $40 trillion (U.S.) by the end of the decade, up from $16 trillion now.

Increasingly, the price of admission to this world that offers aboveaverage returns is very big. It can cost tens of thousands to subscribe to the services that identify dealmaking in private markets for infrastructure, real estate, and mergers and acquisitions; and purchase prices for the assets involved are often in the millions, sometimes billions, of dollars.