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ERROR: type should be string, got "https://www.wsj.com/articles/blackrocks-12-billion-bid-to-become-a-private-equity-giant-is-behind-schedule-11551016800\nBlackRock’s $12 Billion Bid to Become a Private-Equity Giant Is Behind Schedule\nOfficials hope to secure initial funding for Long Term Private Capital, which has been a tough sell to some investors, later this quarter\nBlackRock is under pressure to seek new revenue sources as prices of popular funds decline and clients seek higher-returning alternatives to stocks and bonds.\nPhoto: Gabriella Angotti-Jones/Bloomberg News\nDawn Lim\n@dawnmlim\ndawn.lim@wsj.com\nUpdated Feb. 24, 2019 1:32 pm ET\nBlackRock Inc. BLK -2.12% in 2018 set a goal of raising at least $12 billion to buy and hold long-term stakes in companies, replicating the approach of Warren Buffett. The world’s biggest money manager is still waiting for its first check.\nThe slow pace of fundraising reflects the challenges facing BlackRock as it makes an aggressive push into a part of Wall Street it doesn’t dominate: private equity.\nBlackRock became a $6 trillion giant with the rise of exchange-traded funds and index funds that investors use to replicate markets cheaply. Now the New York firm is under pressure to seek new revenue sources as prices of popular funds hurtle to zero, cash flowing into traditional asset managers slows and clients seek higher-returning alternatives to stocks and bonds.\nBut an experiment with private equity is proving to be a tough sell for some investors. A major Chinese sovereign-wealth fund and the state investor for Alaska’s oil wealth passed on a new BlackRock fund known as Long Term Private Capital, according to people close to those organizations. Florida’s largest public pension fund and Minnesota State Board of Investment are in talks with BlackRock, but no deal is done, said people close to those institutions.\nBlackRock officials now hope to secure initial funding later this quarter after missing internal deadlines in 2018. The architect of Long Term Private Capital said the launch has taken longer than expected partly because of the fund’s unusual approach. Its fees are cheaper than many in the industry, but it doesn’t have a deadline for returning money to investors.\n“Innovation is harder than we thought” in private equity, said Mark Wiseman, BlackRock’s head of active equities.\nThe idea of Long Term Private Capital came from Mark Wiseman, BlackRock’s head of active equities.\nPhoto: mike segar/Reuters\nAlthough the firm has a vast lineup of financial offerings, exchange-traded funds and index funds are still a major source of revenue for BlackRock. These products comprised two-thirds of the firm’s roughly $6 trillion in assets and generated roughly 40% of BlackRock’s revenue in 2018.\nThat leaves BlackRock vulnerable to sudden shifts in investor sentiment. The firm has been adding to business lines that allow the company to lock up investors for longer periods and charge more lucrative fees. Its nontraditional investments include corporate loans, energy pipelines, solar plants and backing other private-equity funds. These assets, known in the industry as alternatives, made up about 2% of the firm’s assets in 2018 and generated 8% of revenue.\nBlackRock has done private-equity deals for decades, but it struggled to create its own fund for these investments. In 2011 it launched a group that would take stakes in smaller companies but closed it in 2013 after failing to hit fundraising targets.\nIn 2017, BlackRock considered options from buying a private-equity firm to bringing in a team from another firm. It ultimately decided that it should build its own fund.\nBlackRock’s Larry Fink Wants to Become the Next Warren Buffett (Feb.7)\nBlackRock’s Assets Fall Sharply (Jan. 17)\nPrivate-Equity Firms Create Funds That Are Built to Last (Jan. 1)\nThe idea of Long Term Private Capital came from Mr. Wiseman, formerly the chief of a large Canadian pension investor. What he sketched out in his black Moleskine notebook during the fall of 2017 was the beginnings of a fund to hold bets as long as it desired, an approach that takes a page from Mr. Buffett at Berkshire Hathaway Inc. Many buyout funds operate under strict deadlines to cash out of bets—even if it means cutting off future gains.\nThe fund would make $500 million-plus wagers on cash-generating businesses so returns could compound over time and would move between stocks and private equity. The firm told investors cheaper fees would allow the fund to deliver the same returns as rivals while taking less risk.\nLong Term Private Capital is offering to charge clients a management fee below 1%, and 10% of profits, and its management fees would fall as the fund gets bigger. Private-equity funds across the industry charge clients a 2% management fee and 20% of profits, according to median figures from Preqin.\nBlackRock aimed to raise $12 billion to $18 billion. Mr. Wiseman told the firm’s chief executive, Laurence Fink, the fund should raise $4 billion in 2018, said people familiar with the matter.\nThe company decided not to staff the fund with a full team at first and test the appetite of investors with a seven-page slide presentation, refining the concept as it went along.\nSeveral potential investors were concerned that a team wasn’t yet in place, and that BlackRock had no record to show, according to people familiar with the matter. The firm didn’t want BlackRock’s own balance-sheet capital at risk for its first deals, said three people familiar with the matter.\nBlackRock now has a team of 17 dedicated to the fund. Officials hope for a first fundraising close this quarter with about four outside investors. BlackRock would also invest money alongside those investors, according to two people familiar with the matter.\nMr. Fink told Mr. Wiseman in late 2018 the firm wouldn’t necessarily have the right team or design for the fund if it moved faster, said people familiar with the matter, a reminder that the fund’s success wasn’t decided by the speed of a first close.\nWrite to Dawn Lim at dawn.lim@wsj.com\nCopyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8\nShow Conversation Hide Conversation (3)\nEurope’s Schools Are Closing Again on Concerns They Spread Covid-19\nSome GOP Freshmen Mock Masks, Embrace Gun Rights, Spar With Colleagues\nHow the Capitol Riot Thrust Big American Companies Deeper Into Politics\nTrump Spends Final Days Focused on GOP Defectors, Senate Defense\nBoeing’s Other Big Problem: Fixing Its Space Program\nDonald Tober, Marketer of Sweet’N Low, Dies at 89\nWSJ News Exclusive | Covid-19 Vaccine Leaders Waited Months to Approve Distribution Plans\nArizona Is America’s Covid-19 Hot Spot and on the Brink of Crisis\nCopyright © 2021 Dow Jones & Company, Inc. All Rights Reserved"