Joining us today, we're going to have Oracle Red Bull Racing CEO and team principal Laurent Mekies and Carlyle CEO Harvey Schwartz. But before we get started, a quick video.
Oracle Red Bull Racing leads with speed, precision, and innovation. At Carlyle, we move the same way. Investing with conviction, unlocking access to private markets, and connecting capital to what's next. That's why we're teaming up, fueled by a drive to win that's backed by data, insight, and the right timing. Together, we're driven by access, driven by innovation, driven by performance. Carlyle is proud investment management partner of Oracle Red Bull Racing.
Welcome aboard, Carlyle. We're excited to have you join the Oracle Red Bull Racing family and drive performance to the next level together.
Laurent and Harvey, welcome to Axios. Welcome to Axios House. Thanks for the long trip. So, as we were chatting backstage, we realized what do these two leaders have in common. And we realized that one, data and people are their inputs, but we also realized that performance, excellence, leadership, they all have in common. And you just made two very big gambles at once. You became CEO in July, right? And at the time that you became CEO, F1 in this coming season is undergoing, as I understand it, from my co-founder Roy Schwartz and our friend Fabricio Drummond who are here and who are both F1 experts. They say this is the biggest change in the history of the sport. So tell us the two big changes you bit off at once.
Well, good afternoon everyone. Thank you. We don't call them gambles. However, you're right, the sport is about to undergo the biggest regulation change in F1 history. What it means is that we are going to change both the engine and the chassis regulations at the same time. So it's like you take these 10 giants, you know, we have 10 teams in Formula 1 today, 10 very, very big companies, and you take these giants and you throw them into the complete unknown and it's very difficult that the picking order will be the same. So you will see these giants trying to catch back and to try to find their way back to the top. But that was not enough. It's also the year where Oracle Red Bull Racing has decided to do its own engine, its own power unit.
And pause and just explain for our non-racers the stakes there and what you're taking on with that.
You know, initially we are an energy drink company and 20 years ago we started in Formula 1. We bought a team, got a fair amount of success. And 20 years later we decide to say, well, let's go to the next step, making our own engine for that team and we'll do that with the support of Ford. We will come back to the business after a very, very rich history. And what it means is that you can imagine at the back of our team in England, there was a field and we say, you know, let's build a factory here, bringing 700 people, and let's try to make a Formula 1 engine.
700 people in your organization?
Yeah, 700 people, yeah, out of a total of 2,000. And we go and compete against people that have been doing that for 90 years, the likes of Ferrari, of Mercedes, etc., etc. So, that's the size of the challenge. I call it a crazy challenge. I call it something that no board in the world will approve. But it's billions of investments. But it's a story that identifies us. That's very much a Red Bull story. That's what Red Bull stands for. You do the impossible. You shoot for something that most people think that you should not be doing. And that's also the sort of common point along many others that we found with Harvey and with Carlyle. We don't get blurred by the short-term gain. We have that boldness of the visions. We want to go there. We know it's going to be painful. We know it's going to be a journey but that's exactly the sort of journey that defines us.
Now Harvey, your words about the economy are tracked around the world. This can be a conversation you can actually enjoy. So, look forward to this. Yeah. So, it sounds like you and I in high school had similar athletic abilities. You got into martial arts. Now you don't miss an F1 race. Take us behind the scenes, behind the curtain, if you will, of how this partnership came to be.
Well, first of all, Mike, thanks. Thanks for having us here, Axios team, and for everyone showing up in here in this fairly confined space. It's great to see everybody. It's great to be back in Davos. I just wanted to back up before I answer that, which I will. You know, when you did the introduction, you talked about all these things that Oracle Red Bull Racing, Laurent and his team and his leadership, you know, the focus on performance, teamwork, excellence, patience. I'm surprised he left out style because as I sit here, I'm sure the audience is looking at me and then looking at Laurent and he's got this wonderful accent. I obviously have my New Jersey accent.
No, I mean this is the only aspect of this partnership that feels a little awkward. But all of it felt quite natural. So why did it feel quite natural to get to your question? So, our industry, which David Rubenstein created really back in 1987, after he left the administration, and as you pointed out, he's dedicated much of his life to Carlyle and to philanthropy and in building Carlyle, who knew back in 1987 that private capital would be the dominant source of capital in the world. It's since David launched Carlyle in '87, in 2000 we had the peak of basically public companies in the United States. It's systematically declined over 25 years. We have half the number of public companies today. That is not because CEOs don't want to be public. We take companies public all the time. That's because private capital has grown as an industry. It's very similar to the way I think there's a lot of parallels in how F1 racing has evolved. If you go back and I've spent a lot of time talking to Laurent and the team about this about the car evolution and even today he's talking about the next evolution in the livery. Is that the proper word? The livery. Yeah. I should say it the way you do it would be so much more compelling. But anyway, our industry is also going through an evolution which is for a very, very long period of time and is one of the largest in the world of what we do for a very long period of time like it was really only available to institutions, pension funds, sovereign wealth funds, the wealthiest in the world. Oddly in the United States, there are tens of millions of municipal employees, teachers that actually we help their professionals, their pension plans manage their capital. Same with retirement all around the world. It's now going the next step. And as part of that next step, we wanted a partnership that hit all those prerequisites that you mentioned before, but the demographic of we've been global. We have been in Japan longer than any private capital firm. David was truly the first to go to the Middle East in the 90s with George Bush. And the business we wanted to be connected to had to be global. It had all those other things. The high performance, the focus, it had to be a growing sport. There's 800 plus million fans of F1 and the trajectory of growth is extraordinary. And then the final piece, Mike, like all these partnerships, the people had to feel right. So, I spent a lot of time with Laurent. I spent a lot of time with Oliver, the head of Red Bull, Oracle Red Bull sports. And it was immediate the connection in terms of hey, we can do more than just be economic partners. We can be real partners.
And I'm not going to do it now. I'm going to let you think about it, but I'm going to ask each of you something that you've learned from the other. But in the meantime, Fabricio Drummond from The Race who's a great friend of Axios gave me a little cheat sheet for this interview and he knows racing and he was talking about this new era for F1, this technical reset for fans, like what can they, should they be watching for? How will F1 be different next season?
Expect the unexpected. Really, there is no way you make a change of that scale and you miraculously end up with the same picking order. So you are going to find the big guys that are not at the front anymore and they may be very upset in that situation. You're going to find some outsiders that are suddenly leading the field and all these giants will rush back to get their positions back. And so what you are going to see, what the fans are going to see is that if you think the last few seasons were big when it comes to in-season development and obviously we had a remarkable turnaround last year, ever since Adrian joined us midway through the year. So the season turned in a dramatic way for us. If you think that was big, be ready for a scale of three or four or five times that in 2026. Meaning what you see at the first race might be completely different to what you see at the last race. So the time to market, we call it time to race. So the time between an idea you have about how to make the car faster and your capacity to realize that idea to bring it to the track is going to have more value than the idea itself. That speed.
And the team is very well positioned as Roy and Fabricio put it to me, you have the drivers.
We do have the drivers. Yes. Yes. That's the exciting part is that a bit like for Harvey and Carlyle, we like to say they have the drivers with emphasis on the because I know there's other people that come through this room but they have the drivers.
To have his points, you know, one of the beautiful things about this sport, there are many so you will need to stop me, but one of the beautiful things and that's we are the most complex sport in the world. And it's all about data. We live in a virtual world. We improve the car in the virtual world. It's developing new tools and new algorithms, new AI, new whatever you like. But in the end of the day, there is a guy or a girl driving the car. And yes, we have the best driver. And we have a very exciting pairing. Max Verstappen will be joined next year by a very promising rookie, Isack Hadjar. He has done only one season in Formula 1. He's 21 years old, lucky, lucky him. And he will be pairing with Max. So we think we have certainly one of the most exciting driver pairings on the grid and we will try to get that mix between the human and the data as right as we can get it.
Love that. Harvey, as you think about performance in your world, put aside money for a second. You probably don't very often get told that. Put aside money for a second.
I'm not sure I love that characterization, but let's just roll with it, Mike.
And think about people, as you think about your team, as you think about Carlyle, how do you encourage excellence, performance, like what kind of culture do you personally pollinate?
Well, I joined Carlyle just about three years ago when David asked me to be CEO, but I had a super fortunate career in finance prior to that. I spent nine years at Citibank, 21 years at Goldman Sachs and so I have a pretty incredible experience just being part of finance and you know we can talk about lots of innovative things happening in the world. You can talk about artificial intelligence and how we think about data and for those you don't know we manage close to $500 billion globally around the world. What may be most interesting to people who are not super familiar with our business, we're 200 employees. So actually on the Carlyle team, not many more than on his team. So team size is around the same. We have close to 800,000 in our portfolio companies that we own around the world. And that makes us one of the top 10 employers in the world. And so, you know, a lot of things have changed since David formed the firm in 1987. The way capital's committed, the way you think about investment processes, the way you harness data, the way you use technology. At the end of the day though, the fundamental principles of talent, motivation, people that care, do the right thing, come up with creative solutions, and excellence. That hasn't changed at all. I don't think that's changed for any high quality organization, just like the organization you've built. At the end of the day, we are a people business notwithstanding the breadth and power of Carlyle and the influence and the capital we deploy. And you know, when he and I talk, he's very humble. But he stepped into his role in basically a complicated time. We were thrilled to sign on. Part of the agreement was that he had to turn the whole season around, which he immediately did. For those who are not F1 fans and Oracle Red Bull Racing fans. So curious how many people are Oracle Red Bull F1 fans? Yeah. So he's very humble, but we told him, 'Look, we're all in. You just have to win.' And he basically just started winning. And so.
This was week one. Week one is the job.
Yeah. The week one, week one, week one we just put that apart as a sort of a transition. But every week after that and I will say as incredible as this sport is for those of you who are fans and for those who are not fans you should really get engaged with the sport. It's amazing. I really think the performance of the team and Max took the whole sport to another level this year and that is the beauty of sport and performance and excellence. But when you're in the garage with the team and you see how they operate and the teamwork that's required. I was at the race in Abu Dhabi and I don't know, I accidentally violated a policy where I went to take a picture. The data is so I deleted it. No, there's a the Oracle Red Bull team is here and literally like three people tackled me and I said really I don't know. They don't look like they're doing anything that special, but they were. So again, but you know, you can't abandon the old school principles of what drives success.
What does Carlyle get out of this partnership?
Well, again, it fits all the natural aspects of our firm. I will tell you the enthusiasm across the firm in and of itself.
And you literally have your name on a car.
Yeah. Yeah. Yeah. But, you know, Carlyle, we could have put our name in a lot of places. The name is very prominently displayed. I would say if you really wanted to get into the micro details, it's the ability to convene all over the world. It's the ability to do things like this. People would maybe have less exposure to Carlyle. Get to know us a little bit better. But there'll be other things we'll do with this partnership broadly across the Red Bull organization. But again, like all the things we do and the way they approach things, we're not in a rush on those things. It's just about how can we patiently look to build things together that are synergistic. But that was the key to it. It was really about the people and the dialogue and the opportunity set.
Laurent, there's no greater responsibility than anyone can have than to have a young person in their life. I'm very blessed to have 11 nieces and nephews. Experiences matter. In 1988, you went to a Grand Prix. Tell us about that.
Look, they say that half of the kids, half of the children out there, they are car fans. So, I was on the right half of it. I was a car fan. So, I just was just watching races with my parents like many, many of us and grew up as a fan and eventually, you know, I always tell Harvey, you know, he's working. I'm not, you know, I'm just being paid to do my hobby. And that's the incredible luck we have in our sport. We try not to forget it. As Harvey said, it's a people business. You get the best people, you win. You don't get the best people, you don't win. What was fascinating when we met is that they have this incredible balance which we are looking for all day and all night long between how do you marry the data-driven aspect and the human element and that's what we do all day and we found out that that was also doing all days and it is as Harvey said it is areas that we take our time to explore together with our common desires for our brands to broaden the access. You know, Red Bull on top of what Oracle Red Bull Racing is doing, you know, as we are going, we are taking Formula 1 to the streets. As the sport gets more and more global, we are taking Formula 1 to people that have never seen, will never come to a race or never even watch a race, but we go into the city center, we run the car and we get that broader access to the sport to more and more people. And if you fast forward quite a few years and you see where the sport is today and we are very, very proud of that and we think it's only the beginning.
Yeah. I went to the F1 race in Vegas with Roy and Jim. Axios has had events at the Grand Prix in Miami and Austin and already there's just such an ecosystem around an F1 race. So much excitement around it.
