Tony James

But the big firms were ambivalent about this business.

They were ambivalent because it wasn't quite an agency business.

Yep.

There were old line bankers that didn't understand it and didn't actually want to understand it, really.

They just didn't want their clients to complain about competing with something that the firm bought.

Right.

And so that institutional ambivalence gave us a huge runway that we just plowed through.

And it became a magic synergy between the investment banking and the merchant banking.

And ultimately, we built funds of funds and real estate businesses, venture capital.

We had a business back then called Sprout, which was

One of the big three.

How can the 70s be gone now?

Yeah, well, of course, back then Drexel was the big gorilla and we were second in high yield.

We were more of a client than a threat to Drexel at the time because of our principal business.

Yep.

Drexel had the high yield, the highly confident letter.

If we said we were highly confident, people would say, well, so what?

You don't matter.

So we created this bridge fund and we turned it heavily.

We bet the fund and we bet the firm on every bridge loan.