Carlyle CEO Kewsong Lee says ‘everything in our business is speeding up,’ with deals and fundraising picking up steam

• The Carlyle Group reported its second-quarter earnings on Thursday.
• Carlyle CEO Kewsong Lee told Insider that the firm has doubled the pace of deals this year.
• He also shared thoughts about active deal sectors and opportunities for growth at the PE giant.

Carlyle CEO Kewsong Lee has had a busy few months.

The firm has jump-started dealmaking and boosted fundraising by nearly 50%.

“Everything in our business is speeding up. Deals are being done faster, fundraising is happening faster, exits are occurring faster,” Lee told Insider in an interview. “On the investing side, our pace has more than doubled in the first six months of this year.”

Last month, Carlyle joined Blackstone and Hellman & Friedman to acquire healthcare supplier Medline in a deal valued at more than $30 billion, marking the largest private-equity buyout since the financial crisis.

Smaller deals included Carlyle’s minority stake in Beautycounter, as well as in END, a UK-based fashion and apparel manufacturer. Carlyle also invested more than $300 million into Neogov, a software firm focusing on human capital management for the public sector, valuing it at more than $1 billion.

Lee became the sole CEO of the Carlyle Group in September 2020 when co-CEO Glenn Youngkin stepped down, at the time hinting he might pursue a career in politics. Since then, Youngkin has thrown his hat into the gubernatorial race in Virginia, nabbing the GOP nomination this summer.

Just months after taking on the sole CEO role, Lee found himself helming one of the world’s largest alternative-asset managers at a time of widespread uncertainty about what the pandemic meant for global business.

“In a very short amount of time, with the environment changing around us, I’m incredibly proud of how our organization has evolved, adapted, and really executed,” Lee said.

The firm raised $10.4 billion in the second quarter for a total of $18.2 billion in the first half of 2021.

Bloomberg reported in July that Carlyle is looking to raise up to $27 billion for its latest flagship fund, which would set records as the largest-ever PE pool. Lee declined to comment on the report, but said that limited partners are interested in doing business with fewer asset managers.

“LPs want to do more and more strategies with us, thereby consolidating capital with fewer relationships, and obviously, we’re the beneficiary of that,” he told Insider.

In April, Carlyle merged its US buyout and growth-investment strategies, meaning the firm is now pooling resources to drive dealmaking across a wide range of deal sizes and sectors.

“When you look at the convergence of a lot of these industries, our architecture, because we’re integrated into a common platform, really sets us up well for that,” Lee said about the newly combined group. “It’s because we’ve done that that they can see more, capture more, move faster, and deploy more,” he added.

Lee named technology in industries like financial services and healthcare as two examples of areas that provide new investment opportunities.

The alternative asset manager’s share-price gains have lagged those of its publicly traded competitors since Carlyle’s 2012 IPO.

Lee outlined a four-year strategic plan at Carlyle’s investor day in February. The firm wants to double distributable earnings to at least $1.6 billion by 2024 and raise $130 billion or more in new commitments from LPs. Lee wrote in his first letter to shareholders as sole CEO that Carlyle was “thinking bigger, performing better, and moving faster.”

In the second quarter Carlyle raised $5.9 billion for real estate out of $6.7 billion for global private-equity, which encompasses corporate private-equity as well as assets like real estate and natural resources. The firm has closed on a total of nearly $7 billion of capital for its US opportunistic real-estate strategy.

Assets under management rose to a record $276 billion, according to second-quarter results released on Thursday, versus $260 billion the previous period and $221 billion in the year-ago quarter.

Pre-tax distributable earnings, or money that’s available to be returned to shareholders, were $395 million, up from $198 million the same quarter last year.