Apollo's Jim Zelter on the Future of Private Credit

In this episode of Goldman Sachs' Great Investors, host Alison Mass interviews Jim Zelter, President of Apollo Global Management, on the transformative role of private credit in today's global economy. Zelter reflects on his journey from a Wall Street trader to a leader in alternative assets, emphasizing the foundational lessons from the trading floor—speed, decisiveness, and intellectual curiosity—that continue to shape Apollo’s culture. He argues that private credit is often misunderstood, framing it not as a narrow $2 trillion direct lending market but as a $40 trillion asset class spanning investment-grade financing for infrastructure, energy transition, and AI-driven capital expenditures. Zelter highlights Apollo’s strategic positioning to meet massive global capital needs, particularly through its insurance arm Athene, which provides long-duration capital to finance large-scale projects. He remains confident in the resilience of the private credit ecosystem despite market concerns, though he cautions investors about underestimating the risks tied to AI’s return on invested capital and the shift from asset-light to asset-heavy business models. Zelter also discusses Apollo’s growth trajectory, cultural priorities, and global focus on Europe, Japan, and select Asian markets, while underscoring the firm’s commitment to maintaining a flat, agile organization despite its size. The conversation closes with Zelter’s personal reflections—his love for nature, beekeeping, and fishing—and his enduring excitement about the future shaped by AI and technological progress. He credits his father’s advice to listen more than speak and admires David Tepper’s analytical clarity. Overall, Zelter presents a vision of private credit as a vital, evolving force in capital formation, essential for funding the world’s next great infrastructure and innovation waves. His message is clear: while challenges lie ahead, the opportunities are unprecedented, and those who stay focused on long-term value creation will be best positioned to succeed.