“I feel like I have been saying this every year, that valuations have divorced from reality and yet they continue to go up,” said Jon Korngold, the global co-head of technology Investing and head of Blackstone Growth, speaking with Sophie Shulman at Calcalist and Bank Leumi’s Mind the Tech NY 2021 conference Tuesday.
“No doubt, I think valuations are full by any metric, however, I think right now the market is ascribing world-class prices to companies which aren’t all world-class. So I think now, more than ever, it has become so much more important to be a deep sector expert to really understand what is a good company versus what is a great company,” he said. “From our perspective, you are always going to pay the full side of a fair price for great companies. I jokingly say you only cry once when you buy the best. But we take a much more strategic approach thinking to partner with companies, where the price is a factor but it cannot be the only factor.”
When asked about the growing interest in Israel from megafunds, Korngold said he thinks “it is a wonderful thing for the economy when you see all these world-class firms interested in Israel. It is such a special place for the reasons you know, we would not have been here if we did not think it is a special place. It is the most dynamic market we look at. You have companies built for globalization from day one, the domestic market is too small and so from day one they are built for scale, and they scale at a rate other companies from other countries can not scale at.”
“We are trying to bring a set of operational resources to the Israeli economy that has never been introduced at the scale we are able to do,” he continued. “We have $731 billion of capital that gives us a massive advantage over stand-alone funds because it allows us to make huge investments.”
Watch the full conversation in the video above
