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The chance conversation behind Blackstone’s sweeping AI strategy
Steve Schwarzman says a 2015 conversation with Jack Ma helped spark Blackstone’s AI conviction. Blackstone’s approach reaches beyond data centers to cloud computing, AI company stakes, chip backed financing, power infrastructure and adoption inside portfolio companies.
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Key takeaways
- Steve Schwarzman says a 2015 conversation with Jack Ma helped spark Blackstone’s AI conviction.
- Blackstone’s approach reaches beyond data centers to cloud computing, AI company stakes, chip backed financing, power infrastructure and adoption inside portfolio companies.
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openai.comCreate a landscape editorial hero image for this Studio Global article: How did Blackstone CEO Steve Schwarzman’s chance conversation with Alibaba founder Jack Ma on a bus in China in 2015—when Schwarzman initial. Article summary: Schwarzman describes the 2015 bus conversation with Jack Ma as the accidental starting point of Blackstone’s AI conviction: he initially did not understand the technology, while Ma explained that it would transform the w. Topic tags: general, news, general web, user generated, education. Style: premium digital editorial illustration, source-backed research mood, clean composition, high detail, modern web publication hero. Use reference image context only for broad subject, composition, and topical grounding; do not copy the exact image. Avoid: logos, brand marks, copyrighted characters, real person likenesses, fake screenshots, UI text, readable text, watermark
A conversation with Alibaba founder Jack Ma on a bus in China in 2015 helped Steve Schwarzman see artificial intelligence as a world-changing technology, he later recalled. Blackstone’s strategy now reaches well beyond AI developers: it includes data centers, cloud computing, chip financing, power infrastructure and efforts to bring AI into businesses it owns.1
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From an unexpected conversation to an investment strategy
Schwarzman said he initially did not understand what Ma was describing. Ma’s argument—that AI would be a profound technological change and transform the world—stayed with him. Schwarzman has described the encounter as an accidental starting point for Blackstone’s AI conviction.1
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Blackstone, which manages more than $1.3 trillion in assets, has since built exposure across several parts of the AI ecosystem.12 Reporting puts its data-center portfolio at roughly $200 billion.
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Where Blackstone is placing its AI bets
The firm’s reported activities span several connected layers of the technology’s expansion:
- Data centers and cloud computing: Blackstone has a large data-center business and is pursuing a cloud venture with Google.
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- AI companies and chips: It holds stakes in AI developers including OpenAI and has provided financing secured by Broadcom and Nvidia chips.
- Power and cooling: Its investments also include power plants and data-center cooling equipment, which support the infrastructure required to run computing systems.
- Adoption inside businesses: Blackstone is working to introduce AI across portfolio companies through Ode, a venture reported as involving Anthropic, Hellman & Friedman and other investors.
- Internal deal evaluation: An AI model has also been used to weigh in on proposed Blackstone deals.
Taken together, these examples point to an infrastructure-first strategy as well as investments in AI developers themselves. Blackstone is seeking exposure to the facilities, equipment, energy and business adoption that may accompany wider AI use—not only to the companies building models.2
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Why Schwarzman compares AI with electricity
Schwarzman has used the development of the electricity grid to explain why he believes AI may still be at an early stage. In the account of his remarks, he pointed to the infrastructure needed to make electricity useful and to applications such as radio and television that were not foreseen when the grid was being built.6
The analogy is about uncertainty and time: foundational technologies can require extensive infrastructure before their eventual uses become clear. Applied to AI, it supports Schwarzman’s argument that future applications may extend beyond what investors can identify today.6
But an analogy is not evidence that every investment will pay off. A technology can have a long runway while particular projects, valuations or financing arrangements still face risks.
The risks behind a broad infrastructure bet
Data-center development is drawing local opposition, and Blackstone has said it is working to address AI’s societal and environmental implications.46 The buildout also depends on electricity and equipment; reporting has described shortages in those areas alongside strong demand for computing capacity.
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There is also a financial risk. Coverage of Blackstone’s AI exposure has raised the possibility of a capital-spending downturn and noted concerns about concentrating so heavily on one theme.48 Data centers, chip-backed lending and power assets may look like different investments, but their performance could still be linked to the same underlying driver: demand for AI computing and continued spending on its infrastructure. That is a risk to consider, not proof that the investments will move together.
Blackstone’s strategy reflects a long-term bet on AI’s potential and the infrastructure it may require. Schwarzman’s electricity analogy explains why he thinks the opportunity could develop over time; it does not settle whether today’s investments are priced well or will earn adequate returns.
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Steve Schwarzman says a 2015 conversation with Jack Ma helped spark Blackstone’s AI conviction.
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Steve Schwarzman says a 2015 conversation with Jack Ma helped spark Blackstone’s AI conviction. Blackstone’s approach reaches beyond data centers to cloud computing, AI company stakes, chip backed financing, power infrastructure and adoption inside portfolio companies.