David Rubenstein — Raising Billions of Dollars & Advising Presidents

David Rubenstein traces his path from an aspiring politician and lawyer to White House aide under Jimmy Carter, and finally to founding The Carlyle Group after Carter lost reelection. He explains the mechanics and history of leveraged buyouts and private equity, including the origins of the '20 percent carried interest' and the innovations (a large in-house fundraising team, multi-product and global structure) that made Carlyle successful. The conversation covers his reputation as a virtuoso fundraiser, lessons from interviewing figures like Jeff Bezos and Ruth Bader Ginsburg, and his views on power in Washington versus money. He also discusses reading 100 books a year, the importance of literacy and civics, raising children with wealth, honoring one's parents, and his concept of 'patriotic philanthropy.'

• Rubenstein only founded Carlyle because Carter lost reelection and no top law firm would hire a former Carter White House aide, forcing him to recalibrate his entire life.
  00:30:27
• He shifted from law to business after realizing law was really a business about making money, deciding 'I'm going to be in the money-making business' and starting his own buyout firm.
  00:32:00
• His key Carlyle innovation was building 'the Fidelity or T. Rowe Price of private equity' with multiple funds (buyout, venture, growth, real estate) under one institutionalized, globalized brand instead of a single fund.
  00:44:23
• He turned fundraising, then considered the low point of the food chain, into his differentiator by building a large in-house fundraising team and traveling the world relentlessly.
  00:47:29
• The Carlyle name came from a partner who'd read about financier Andre Meyer living at the Carlisle Hotel; their original target was to raise just $5 million, not $5 billion.
  00:55:45
• Carlyle rented Jeff Bezos a bibliography of books in print for early Amazon and turned down his offer of 20-30% of Amazon stock, taking cash instead, then later sold the ~1% stake they did get.
  01:02:57
• Rubenstein's mother kept scrapbooks only of his patriotic philanthropy, not Carlyle's successes, signaling what she valued most about his life.
  01:34:33

• Ted Sorensen, JFK's speechwriter, was called Kennedy's 'intellectual blood bank' and became top speechwriter at age 31.
  00:09:22
• At age 27, three years out of law school, Rubenstein had an office in the West Wing and traveled on Air Force One and Marine One.
  00:16:01
• Rubenstein has never tasted alcohol in his life, a rule he adopted young to save time and stay out of trouble.
  00:20:10
• When Rubenstein started Carlyle there were about 250 buyout/investment firms worldwide; today there are roughly six or seven thousand.
  00:41:17
• The term 'carried interest' may derive from medieval Venetian ship crews who got a 20% interest in spices they carried back from Asia.
  00:42:20
• Ruth Bader Ginsburg would pause about 20 seconds before answering questions, a lifelong habit of thinking before speaking, and earned 20-minute standing ovations at the Kennedy Center.
  01:06:31
• Quoting Henry Kissinger, Rubenstein notes 'power is the ultimate aphrodisiac' in Washington, where power matters more than money or wealth.
  01:11:46
• Rubenstein cites that 14% of Americans are functionally illiterate, two-thirds of federal prisoners are functionally illiterate, and only 30% of college graduates ever read another book.
  01:20:31
• He notes that two-thirds of Americans couldn't name the three branches of the federal government, and a majority couldn't pass the basic citizenship test in 49 of 50 states.
  01:37:37
• Rubenstein personally funded the repair of the Lincoln Memorial; during the snowy C-SPAN announcement his mother called his cell phone to tell him to put his hat on.
  01:36:06