Digital Bridge at Deutsche Bank Conference: AI and Growth Focus

On Monday, 10 March 2025, Digital Bridge Group Inc. (NYSE: DBRG) presented at the 33rd Annual Deutsche Bank Media, Internet & Telecom Conference. CEO Mark Ansey highlighted the company’s strategic direction, emphasizing both its successes and challenges. While celebrating strong fundraising results and growth in digital infrastructure, Ansey acknowledged the stock’s undervaluation and outlined plans to enhance investor perception.

Key Takeaways

• Digital Bridge raised $9 billion in 2024, with assets under management nearing $100 billion.
• The company aims to double its assets under management to $200 billion in five years.
• Challenges in the data center industry include power and supply chain constraints.
• New initiatives focus on AI infrastructure and power strategies.
• Record leasing backlogs in data centers and strong performance at VerticalBridge.

Financial Results

• Raised $9 billion in funds during 2024.
• Fourth-quarter performance led to a run rate Fee Related Earnings (FRE) exceeding $140 million.
• Assets Under Management (AUM) have grown fourfold to nearly $100 billion since the merger.
• The Zayo backlog exceeded $4 billion.

Operational Updates

• Strong organic growth was observed across towers, fiber, and data centers.
• The European Union approved the Yonder acquisition, marking a significant investment from the third flagship fund.
• Digital Bridge returned $9 billion of capital, setting the stage for new fundraising in 2025.

Future Outlook

• The company plans to capitalize on trading at a discount to Net Asset Value (NAV).
• New products include a data center Realty Income Fund in partnership with Goldman Sachs.
• A power-adjacent strategy aims to achieve $20-50 billion in AUM over the next five years.
• Expected accelerated leasing cadence in AI infrastructure from 2026 to 2028.

Q&A Highlights

• CEO Mark Ansey emphasized the company’s momentum in fundraising and capital deployment.
• Ansey reiterated the goal to double assets under management within three to five years.
• The company’s unique position in digital infrastructure was highlighted as a competitive advantage.

Digital Bridge’s comprehensive strategy and growth plans were detailed throughout the conference call. For further insights, readers are encouraged to refer to the full transcript below.

Full transcript - 33rd Annual Deutsche Bank Media, Internet & Telecom Conference:

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: please take their seats, we’re going to go ahead and get started. Welcome everyone to our thirty third Annual Media, Internet and Telecom Conference. For those of you who don’t know me, I’m Matt Niknam, Com Infrastructure Analyst at

Mark Ansey, CEO, Digital Bridge: Deutsche Bank. We’re very pleased to welcome back Digital Bridge CEO, Mark Ansey. Mark, welcome back. Yes, thanks, Matt. Thirty one years?

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: Thirty three for the conference.

Mark Ansey, CEO, Digital Bridge: That’s incredible.

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: Many of which you’ve been a part of.

Mark Ansey, CEO, Digital Bridge: Well, I was at Deutsche Bank from ’99 to 02/2002, remember coming to this conference and there were some investors this morning laughing about that ninety nine conference with everything.com, pets Com, this Com, that Com. So we’ve been coming here a long time.

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: Mark, you’ve been very busy since you took the helm at Digital Bridge. So maybe we can start by recapping some of the bigger milestones, ’24 and what you’re most focused on in terms of top priorities for the company in ’25? Well, I

Mark Ansey, CEO, Digital Bridge: think that the headlines coming out of ’24 were, one, pretty significant beat on fundraising at $9,000,000,000 We delivered a really strong fourth quarter, which gave us run rate FRE kind of in that 140 plus zip code. Still a missed guidance and where we wanted to be in 2024, but cadence that would suggest there’s strong opportunity to recover and come back here in ’twenty five. Two other headlines that I think were really important for ’twenty four was one, we got to almost $100,000,000,000 of assets under management. You think about that journey five years ago when we merged into the public real estate investment trust, we were less than $20,000,000,000 of digital assets under management. So, we’ve more than 4Xed our digital infrastructure assets under management going from $20,000,000,000 to almost $100,000,000,000 in a very short period of time, about four years since the merger.

So we’ve done a lot of hard work between now and then. And the fourth thing that I think was important last year is just the organic growth that is happening down at the portfolio companies. And that really manifested itself strongly with operating results in towers, fiber and data centers. And we’ll drill into some of that, but I think what it did is it set up leasing backlogs into this year that were record levels. We have a record backlog in terms of where our data center portfolio is today.

The backlog at Zayo over $4,000,000,000 is just incredible. I mean, that’s really been a big surprise standout story. And then the early results that we saw at VerticalBridge in January, the strong leasing in fourth quarter. So when you get all of those swim lanes producing at the same time, that’s a rarity. It’s the opposite of triple witching.

It’s like triple everything going in the right direction. Usually, we have one or two of those swim lanes working pretty hard, like towers is going well and maybe fiber is down and data centers are up. But I think all of the sort of digital bridge basic food groups across all of our 51 companies are experiencing really good organic growth. And I think it sets up for a really strong 25. We’ve got great momentum in fundraising.

We have spectacular momentum in terms of putting capital to work. We announced that the EU this morning had approved the Yonder acquisition, which is great. So we got European mission approval to proceed with the closing on Yonder. That’s our fifth big investment out of our third flagship fund, which indicates we’re putting capital to work. And then the other thing that we said in the earnings call that’s sort of the subtext is $9,000,000,000 of return capital at the same time.

I know that sometimes frustrates our public investors a little bit, but because we do lose a little bit of FRE. But part of returning capital and generating great returns is what we do as an alternative asset manager. I think it’s always kind of like you got to take sort of one step back to go two steps forward. So I like that setup because as we returned a lot of capital in ’twenty three and ’twenty four, it’s given us the window to go ask for new capital in ’twenty five. And I think when you look at the fundraising schedule in terms of the five products we have in market right now and the investment ideas that we’re providing LPs, they’re really unique.

And I don’t think there’s another firm in the world that gives investors that kind of specific access, Matt, to the best digital infrastructure investments that we see around the planet today. So I like the setup for ’25, it’s really in a good spot. And I also got to thank my team. I mean, it was a hard year, but our new CFO, Tom Amerhofer is doing a great job. We kind of reframed our guidance.

Him, Severn and I decided to reset the table for ’25, deliver a different kind of cadence, which is back to sort of four, five years ago, we want to be the guys that kind of under promise and over deliver. So everything is really set up strong for ’25. And as I said on the earnings call, there’s a strong foundation for where the stock is today to build from here. We now have to go take that case and that argument to investors that we’re trading at a massive discount to our NAV.

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: It’s a great segue into my next question. So you think about all the milestones and the great setup. What do you think the Street’s missing or getting wrong when you look at the stock price? And I guess maybe if you can be a little bit more detailed and granular on what you can do in 2025 to change that perception?

Mark Ansey, CEO, Digital Bridge: Well, I think it first starts with what I did on the fourth quarter, which was owning the mistake that we made in the third quarter. We set the wrong guidance that was on me. So I take full responsibility for us missing our guidance in the third quarter. And I think that was really a byproduct of we had the right fundraising number for the year, but it was so back end loaded that we missed Q1, Q2 and Q3. And it’s actually a lot like towers.

If you miss your leasing in Q1, it just compounds and you sort of get whacked by the time you get the end of the year. If you miss Q1, you miss those commencements that happen in Q2 and Q3. Same thing happens in fundraising. It’s actually a very parallel path because our fundraising commitments, our investors are with us for eleven to thirteen years in a fund, much like signing a ten year SLA on a tower. So if I have a bad first quarter and a bad second quarter, it compounds and that’s what you saw was that snowball effect in terms of our miss on guidance in Q3.

I think this year, we’re a lot more poised to do quite well. We’ve been very prescriptive about what we’re going to do. The first quarter is finishing up our third fund, finishing up our second credit fund. That will last into Q2. We’re launching our second private wealth product.

Our first private wealth product was wildly successful. I never could have imagined we’d raise $1,100,000,000 in three months. And that we should have probably gone to private wealth a lot quicker. Our peers have all gone to private wealth and I think it’s a copycat league. So we’re just back drafting on what Blackstone has done and what Ares and Apollo have done.

And I think when we finally stepped up onto that same stage as our peers, what we found out is private wealth allocators were like, look, I don’t have that. I don’t have access to digital infrastructure on a private basis. So what we found is that product flew off the shelf. So we’re back with our second product. Andrew Cox has done an amazing job.

We were really lucky to get him from KKR. He kind of fell in our lap and he’s doing an amazing job. So I’m excited to get that launch. That launch is in Q2. We should feel the impact of fundraising in Q4.

And then the two new products that we announced on the earnings call, I think people are really curious about, which is our new data center Realty Income Fund. It’ll be our first real estate product since we did the post merger with Colony as a REIT. It’ll be our first reentry back into the real estate LP world. Remember, LPs in the real estate world allocate over $4,000,000,000,000 of capital for private real estate. That’s actually bigger than infrastructure, if you think about it, in terms of where we can go fishing.

So that’s a much bigger pond with a lot more fish and we’re competing against the likes of strip centers and apartments and office buildings, CBD office buildings. I like that competition. I’m happy to go toe to toe with CBD office and strip malls. So, we think there’s a lot of opportunity for us to raise the capital. We’re doing it in partnership with Goldman Sachs, which we’re excited about, and that has a lot of runway.

So, we’re launching that product in Q3. It should still be impacted that in Q4. And then what we’ve talked about Power, I think I’ve been you and I have been talking about Power for like two years. We’ve been developing Power adjacent to our data centers as partners and those partners typically have been publicly traded utility company. So they’re getting most of the margin on our power activity.

So I want to flip that script. So I think we’ve been really clear about our ability to build adjacent to our data center, power sources, behind the meter and off grid power solutions where we can be the provider of power. We can be on grid, we’re interconnected to the grid and allows us to trade power. And that’s a big difference because once you have interconnection much like fiber, one of the things we learn these lessons from digital infrastructure, power is the same way. Once you’re interconnected, you can go grab power from many different sources.

And so there what we have found is we own the data center, we’ve taken the risk, we have ownership of the customer, we should own the economics on power. It’s something we actually never did in towers and we never did it in fiber. But in data centers, you can actually move upstream, you can control the flow of power to your data centers. So micro grids, batteries, other forms of transmission, these are things that we can invest in, that we have confidence in. We’ve now built micro grids to a couple of our data centers.

We understand how the economics work, how energy flows. And most importantly, I really like where battery storage is going. A lot of new things happening in battery storage that are extending the life of batteries. And more importantly, we can get to higher power sources. And that really helps us deal with intermittent, because one of the grievances on solar and wind has fluctuations.

So if we can even out those fluctuations and we can control that source of power through our own battery sources, there’s a big opportunity to invest there. We think there’s a $20,000,000,000 to $50,000,000,000 AUM opportunity to invest in power over the next five years. Remember, again, we’re already building the data center. We’ve already got $18,000,000,000 of CapEx committed to new data center construction over 100 locations where the on if you aggregate our 11 portfolio companies and data centers, we’re the largest developer of data centers held by a third party data centers by a long shot.

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: It wouldn’t be a session with Digital Bridge without asking about AI. So maybe let’s start and how would you characterize, I guess, how far along we are in the AI infrastructure build out? And maybe we can delve into how this differs across data centers, fibers, maybe early days of whether that’s impacting the local edge?

Mark Ansey, CEO, Digital Bridge: Well, I think we sat here two years ago and I said we were kind of in the first inning of a nine inning baseball game. I think last year, we were kind of bottom of the first, top of the second. I think this year, spring training, we’re probably bottom of the second, staring at the top of the third. We’re still in this phase where we’re building a lot of LLM infrastructure. And some of that is self performed by our customers and some of it is performed by us.

But by and large, it’s like, I would say, 70% self performed and 30% industry performed. We’ll see where kind of the first workloads at Stargate go and who ends up performing the first kind of three gigawatts for Stargate. I think that’s kind of the first tell in terms of big LOM leasing where that goes. I think as you move to inference and you move to more specific locations where you’re sort of hunting with a sniper rifle, not a shotgun, there’s going to be a big heavy reliance on third party data center operators like Vantage, like Switch. And I think that’s where we really see an accelerated cadence of leasing in twenty six, twenty seven and twenty eight as we move to inference.

And that’s where the Digital Bridge portfolio is really set up to excel. And the only reason I say that is because we take contextually the thirteen years of building public cloud. We were we’ve been along for that journey for the last eleven years. Our leasing with the cloud operators really accelerated in 2021, ’20 ’20 ’2 and 2023, which is really where you saw the cloud begin to move out of the big AZs and into the secondary AZs. So the big AZs would be Santa Clara and Nova, right?

Those would be the two primary nodes. But then as those data center workloads proliferated to places like Reno, Goodyear, Arizona, Austin, Texas, certainly Atlanta, Quebec, Toronto, you really began to see those really what I would say we get those great 9% to 11% cash on cash yields, where you have those 50 megawatt to 200 megawatt campuses, which is kind of the sweet spot for us. And then I think at Switch, it’s just been a different algorithm altogether. With data sovereignty on the rise, private cloud workloads up, which really just found a really unique piece in the marketplace, which was this notion of Tier five private cloud, where a customer really wants the belt and suspenders in terms of power spacing. So our portfolio performed incredibly well last year.

Our leasing backlog is up 22% over last year. We have over seven gigawatts of, I call lease applications, you call them the tower business, interest in our data centers. That is up year over year. And I think that is just going to continue to be a steady cadence for at least the next six, seven years in terms of data center capacity. I think as it relates to the ecosystem, the big winner early is fiber.

I think what we’ve seen out of Zayo this year was a tremendous amount of new activity in terms of bookings, new routes built. I think we announced at Metro Connect how much new fiber we’ve laid in the last two years. People were surprised by that. We did it quietly. We’ve continued to turn up network.

And where that network is really performing well is for hyperscalers. And data center connectivity, there’s very few people that can operate like Zayo does on a nationwide basis, where we can connect not just two data centers or four data centers, but given the uniqueness of our footprint and how many data centers we touch, there’s not a data center in The United States that Zayo doesn’t touch. And so that ability to deploy success based CapEx, deploy what I would call very, very high strand count, medium range and long haul dark fiber routes, that’s very unique. That’s something that Zayo is very good at. And so the old days of deploying 12 to 14 pairs into hyperscale public cloud campus.

Today, we’re deploying 124 to two forty eight pairs. We’re deploying with at least one or two customers and the demand has been incredible. The other thing that’s interesting is our data center portfolio got bigger. So we’re trying to figure out how to weaponize two seventy eight data centers that we have and no better way to weaponize that portfolio than to use Zayo. So as we’re building new data centers, advantage databank and switch, we’re putting Zayo right there.

From the line, first provider into the data center and that boy, that makes it a lot easier for someone to lease when they’re essentially the preferred provider. And we trust they know they can go there first if you get there early. The other thing that I noticed about the new workloads for the AI guys on fiber is it’s not sort of two paths in and out of the data center. We’re now seeing four paths. So this redundancy and this higher level of redundancy that AI customers want is not only more strand count, but they want more unique paths to create that extra amount of redundancy, but also they’re taking those workloads in different directions.

And I think it’s been good. I hope the fiber business continues to be the comeback hit. That could be a really great story for 2025. Early for near edge inference, I think we’re just not there yet. I’m always listening very carefully to what Masa san says.

I think he’s really smart and I think he understands mobility and I think he understands the connection between AI and mobility. A couple of weeks ago here in South Florida, he said the real thing about AI that he gets excited about because of his experience in owning a mobile network is, he believes mobile data traffic will have a 10x increase to the device once we get to true inference on the edge. That’s a big statement. And if you go back to 2013 and 2014 when cloud native applications started showing up in your wireless devices, You know this because you’re an analyst, look what happened to mobile data traffic. Mobile data traffic from 2011 until 2021 went up 10x.

Why was that? It was because public cloud finally got to the device. So as you put the public cloud on the mobile devices, Matt, usage spikes. We see a second wave of spike coming on mobile data networks and this is why we need more spectrum. This is why I think Commissioner Carr has got it right.

We Got to get more spectrum out. T Mobile is in a great position. AT and T and Verizon need more spectrum. And there’s only three ways to deal with this conundrum of a whether you believe Masa’s number is 10x, I’m more like three to 5x. I think there’s a three to 5x increase in mobile data traffic.

By the way, I can be right and Masa can be right. We can both be right and it’s like a huge win for towers. The look through is that the last time we’ve had these step functions in mobile data usage to cell phones go back to really the introduction of LTE, right? Go back to 02/2010. Look at what happened to tower leasing at SBA American Tower and Crown.

And then look at what happened when we started to put cloud native applications on mobile devices in 2014, ’20 ’15 and 2016, look what happened to tower leasing. The same thing is going to happen again here. And ultimately, as we build five gs, five gs is going to take ten years. And it plays out in three phases, just like LTE did. We’ve got the overlays, which were done.

I think we can safely say that pretty much we’ve overlaid all the five gs networks against LTE. Then you go into what’s called infill. Most of you know this in the room that when you turn up a network like an like when we turned up three gs and we turned up four gs, ultimately those coverage rings shrink a little bit because the spectral efficiency in the new radios and the usage case. So as you put more use into a cell site, you start to split the cell site and that creates holes and that’s infill. So five gs right now is an infill and I think we’re in infill for the next two to three years.

And then we move to densification. And I was really clear at Metrica and Acquast Week, I think densification is 2026 to 2029. We’ve got about 1,000,000 small cells today. We’re going to 2,000,000 by 02/1932. Remember, not all those small cells are just for five gs.

You have to think bigger. You have to start looking at connected devices and IoT, which in the world of generative AI, we go from 29,000,000,000 connected devices to almost 60,000,000,000 connected devices by 02/1933. So the real winner in terms of where the mobile data traffic activity is going to be in machine to machine learning and device to device connectivity. There’s a whole phase of investment coming in five gs for near edge and mobile edge, which is why I think you saw some of the early green shoots at vertical bridge in January when they had that massive we had our best leasing month in the history of the company and that never happens. My experience is in thirty one years of tower leasing is my best month has never been a January.

It’s always been a November, December where all the CapEx is back end loaded or it’s pre summertime where carriers are really deploying a lot of CapEx in Q2. So this was a real surprise. We called it the January surprise for towers. So I’ve been saying it, I said it at Citibank, I said it at RHA, I’ll say here, don’t sleep on towers. I think towers is one of the real opportunities that investors should be looking at right now as we set up into the next phase of generative AI.

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: There’s a lot to impact, but while we’re on towers Sorry, one quick. No, no, no, there’s a as I think about towers, is that one or two carriers? Is that broad based? And if it is broad based, is it all sort of this move from coverage to more info? If we could just get a little bit more color in terms of why you’re seeing that?

Mark Ansey, CEO, Digital Bridge: Yes, it is infill, 100%. These are new search rings. These are rings that we didn’t foresee coming. So and by the way, it’s all three of our customers. It wasn’t just one customer in particular.

It was actually a steady diet from AT and T, Verizon and T Mobile. I think also at DigiBridge, we’ve got vertical bridge. It’s a great company. It’s now the number three tower operator. We just integrated the Verizon portfolio.

And we also have built to suit programs in place with all three carriers now. So as the program with Tillman wound down, we stepped in, created a national program with AT and T we’re excited about. We already have a joint venture with Verizon, and we’ve had a long standing relationship with T Mobile where we’ve been the national BTS provider. So, we’re in a really good spot because we’re getting not only De Novo co locations, but we’re also getting a ton of backlog into newbuilds. So that combination was why January was tripped, unexpected, but it was happy to have had it.

We touched on AI and

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: I don’t want to jump off AI just yet. One obviously question in the marketplace is, are we and you mentioned you referred to us being a sort of in the bottom of the second, top of the third. But how do you think about or how do you answer the question around are we headed for digestion as maybe deep speed turns around Microsoft lease cancellations, maybe change the calculus that some of the larger hyperscalers around AI and what they’re willing to spend at least in the near term?

Mark Ansey, CEO, Digital Bridge: Well, I think there’s this has been the topic on the circuit for the last couple of weeks. And my observations are really there’s four things I think you need to think about. One, we didn’t see DeepSeek as negative. We saw DeepSeek as a logical progression and the fact that costs are coming down in building generative AI applications. And remember, we opened that door.

Meta’s open source really was the foundation for DeepSeek and that was relatively easy and gave them a very big head start. But to get there implied that Meta had to make a huge investment in their open source LLM, which they’ve been investing for a long time. So the subtext winner of that was Meta to a certain degree. But it’s also something that we’ve seen before. This isn’t like a new movie.

Ultimately, as we’ve from the advent of the PC to the Internet to mobile phones to cloud, innovation has happened all along those sort of four curves. And the cost to deploy that infrastructure and the cost to deliver that service comes down over time. What we’ve seen in AI is that those costs, that cost curve has come down about 40x in a period of thirty six months. So the cost to build AI and to build these sort of applications like a DeepSeq is going to continue to get cheaper. And that’s following a logical progression that we’ve seen in other subsectors.

So we weren’t terribly alarmed by DC and we actually think it’s part of where this goes over time. But as cost comes down, something else happens at the same time. Adaptation moves rapidly faster. So if you look at the J curve of adaptation to the Internet, to mobile devices, public cloud, you’ll see it’s pretty simple, like Internet sloped like this, mobile data sloped like this, cloud sloped like this, AI sloping like this. It’s the fastest adaptation we’ve ever seen in a technology shift.

And this is kind of the sort of what people are talking about when they say Javon’s paradox. You have a faster adaptation and you have more data being consumed and stored at the same time. Remember, data has two forms. You’ve got storage and you’ve got compute, active compute and storage. And so what we’ve seen is, as adaptation has accelerated and costs have come down, investment has accelerated.

And we saw that on display in the last two weeks. We’ve had four of our customers come out and say, you’re increasing CapEx, not decreasing CapEx. So you heard announcements from Meta, announcements from Apple, Alibaba had an announcement and then we’ve seen also Oracle revised its CapEx, while Microsoft reaffirmed its CapEx. The important thing was Microsoft confirming their $80,000,000,000 of CapEx. So when Microsoft came out and said, okay, we’re going to move some workloads around and we’re going to shift some things, that was somewhat expected because of the relationship that they have with OpenAI, which to be direct in Sam’s defense, he’s shifting his providers.

He’s not going to go all in on Microsoft. He has a Microsoft is one of the biggest shareholders. They have a long term agreement to develop infrastructure with Microsoft. But also OpenAI has the opportunity to go build their own infrastructure, which again to Sam’s defense, he’s doing that. Building a team, they’re out looking at locations that are going to be OpenAI only locations.

And that’s a logical progression in Sam’s arc in terms of where OpenAI is going to go. It’s going to be an independent for profit company. And part of that is building the muscle memory to build your own data centers. So that customer is an important customer to us. And I look at data center demand as a series of buckets, right, buckets of water.

And you got to look at one bucket is how many leases we signed as an industry in 2024. That bucket filled up to six effectively seven gigawatts with the amount of leasing we did last year. And then there’s this other bucket, which is how much data center capacity do we turn on? Did we light up as an industry? We lit about six gigawatts.

So you have both of these buckets kind of at six, but the leasing bucket was one gigawatt heavier. And as it spills into the bucket of construction, that bucket couldn’t hold it. So we operate, we start in 2025 with a one gigawatt deficit, where the supply can’t match the demand. And then you have the forecast this year where the industry is going to lease eight gigawatts. We’re on a cadence to lease eight gigawatts, but we’re not on a cadence to deliver eight gigawatts of data center haul capacity.

So part of a lease is you sign a lease and you have the conditions precedent to deliver to the customer. And that is you got to deliver the data hall. And that data hall has to be complete with power, base, cooling and connectivity. And if you don’t deliver those four elements, guess what, Microsoft doesn’t have to move into the data hall. And at some point, you have penalties.

And if you’re late, Microsoft can even potentially say, I don’t want to be at this data center. So you’d have to be really late in that instance. But by the way, it’s the same in the tower business. We all have to deliver a tower on a certain point, right? You have an NTP notice to proceed, you got to deliver the tower and it’s got to be ready for the radios and antennas and coax or fiber connection.

So the industry in my thirty one years of doing this, it’s the same thing. It’s about delivery. We’ve got to deliver. And our industry right now is operating at a deficit, going to continue to operate at a deficit in terms of what we can deliver for a while because we have challenges. And again, I like just being super transparent with investors about what the challenges are in data center land.

Data centers are great. It’s a great business. It’s still not as good as towers. But data centers are pretty good and fiber is pretty good too. But the challenge with data centers is, it’s a series of challenges that digital infrastructures never confronted before, which is power and putting a ton of power into a small piece of real hard.

Power density is difficult on 10 acres, 12 acres. Think about Advantage Data Center in Santa Clara, you’ve got six floors, you’ve got 48 megawatts stacked in six floors. You’ve got to bring all that power into essentially like four acres. That’s really hard. And so the industry has some challenges.

We’ve already discussed what those challenges are. It’s power and it’s supply chain. And to build a data center requires a series of specialized components, whether it’s backup gensets, UPC units, construction crews, backup batteries, all of these things you need to deliver data center on time and you need fiber. You need a ton of connectivity and that’s where we have a big advantage. But having Zayo as one of our investments, it allows us to take the connectivity piece piece off the playing field.

We’re able to deliver connectivity. Both of our big portfolio companies, which in Vantage made deals in 2022 with Siemens, we had a ton of backup gensets. So we planned in the middle of COVID to go take a lot of that backup capacity. So by and large, we’ve had very few incidents where we haven’t delivered. Because again, we got a ten year head start.

We started working on this ten years ago. So I think to the newly indoctrinated or the tourists that are in the industry, they’re going to have challenges in the ring data center capacity. For us that have been around a long time, I think we’ve been planning on this for a long time. But it does have challenges. And I think as long as that supply and trade imbalance exists, blips in the road like DeepSeek are not negatives, they’re positive.

And if you just listen to not the noise, just listen to the CapEx, listen to what’s actually really happening, stuff like this is a positive catalyst from the industry, it’s not a negative.

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: I foresee anything seeing these constraints because it seems like a pretty seven gig fleet, six lit, eight gig fleet this year, another six it seems like going to be lit. What maybe eases some of that friction? And is there anything you see with the new administration that can help there?

Mark Ansey, CEO, Digital Bridge: Well, I think, look, the administration has been very constructive on both power and AI. And I applaud the current regime for doing that, because I think that’s the President has always said, we want to stay competitive, we want to be the first in AI. And I agree with him, we do need to be first in AI. I think as much as the executive branch can be helpful, I think our challenge really sits at the state and always is at the state, which is as fast as any executive order can take you on data center construction, you’re still regulated by the local PUC, which control the grids in each of those states. So our ability to let up power is a state issue, not a federal issue.

That being said, there’s things that we can do on a federal basis, permitting to each will serve letters. But inevitably, at the end of the day, you are beholden to the state PUC. You are beholden to that regulated utility company actually turning on the power. A will serve only says I will serve that piece of real estate with that amount of power. It doesn’t say when I’m actually going to turn on the power.

So there’s two differences between having an active will serve letter and having an actual commencement date of when your powers come to that site. So again, to the untrained, who think, oh, God, I have a piece of land and a will serve letter, I’m in the data center business, you’re not. You really have to be in a lot of different things. You’ve got to be in the turning on the power business, building the data hall, getting the fiber there and dealing with all of the supply chain issues and the special components. So this is not a place for tourists.

It’s a complicated industry.

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: I want to bring back a lot of the success that you’ve had with the data centers back to the Digital Bridge story. And there was an interesting discussion you had on the earnings call around megawatts and gigawatts in your portfolio companies at least and how that comes back to the Digital Bridge shareholder. Maybe if we can revisit that just to sort of frame how the success that portfolio companies have had translates to success for the common sort of digital business.

Mark Ansey, CEO, Digital Bridge: I think that’s what makes our story quite unique. And I think we started the conversation by saying, where’s this disconnect in our share price? We’re sitting here today at $10 to $12 a share and some of the parts analysis would indicate we’re worth somewhere between $18 to $23 a share. So we’ve got to take that argument to shareholders because I think just on a pure FRE basis, if we trade it 18 times to 22 times FRE, the stock is going to trade kind of where it is. That’s not particularly exciting.

But what’s really unique about Digital Bridge is we have a big balance sheet and we have really unique assets sitting on that balance sheet, which is databank advantage. Those are really good assets. Those assets continue to appreciate every quarter, particularly databank, which is growing at 20 plus percent CAGR growth right now. So databank is the only real edge compute business at scale across The United States in over 70 markets and the second largest interconnection provider behind Equinix. So it’s a really unique growth story.

And I think that’s going to continue to push our balance sheet up along with our GP stakes. So our balance sheet controls basically that Fulcrum Capital that initially goes into all of our funds. So while our assets under management increase, so does the value of the GP increases, so does the value of Vantage DataBank increase. So we’ve got a balance sheet that’s worth $1,500,000,000 today. My estimation is that balance sheet grows to $1,600,000,000 plus this year.

We’ve got $190,000,000 plus of cash. We’re in a very good cash position. And then last but not least is the carried interest. And I think what we tried to do there was bridge the gap between as we light data center capacity, what does that capacity, what does that accrue, what does that mean for the carry. And I think we’ve getting close to $100,000,000,000 of assets under management, over $40,000,000,000 of equity at work, investors, we’ve got to help investors do the math on carried interest.

We’re sitting on an arsenal of carried interest. And whether you take the low end of our guide or you take the high end of our guide, there’s hundreds of millions of dollars of embedded shareholder value sitting there. And until, as I said on the call, we start turning that out, we start creating distributions as fund one matures and fund two starts moving into maturity and we start returning capital and we start returning profits, this stock is going to accelerate because people are going to see that that’s not episodic. They’re going to see that we have 51 companies as we start exiting investments, that creates a lot of profit and it creates a lot of EPS for our shareholders. So we got to bridge that gap.

We’re going to keep talking about it. We’re going to talk about the power of the balance sheet. We’re going to talk about carried interest. And as we light gigawatts and we turn customers into data center halls, we got to start converting that into carry, which we will.

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: One other sort of topic of conversation that comes up a lot with Digital Bridge is the competition. There’s a lot of old peers who are maybe dipping their toe or doing more with digital infrastructure. How do you maintain your differentiation stand out in this environment?

Mark Ansey, CEO, Digital Bridge: Well, I think we have a couple of really key differentiating points. One, we have an ecosystem of companies that is a force multiplier for our existing company. Just talked about the power of Zayo, working with Switch, Vantage and Databank and how when we build a new data center, we’re pushing our own fiber straight into that data center. So the power of the portfolio on that flywheel creates a ton of opportunity. And other GPs just don’t have that.

The likes of Blackstone, KCAR and Brookfield maybe own two or three digital infrastructure investors to our 51. So we just have a little bit more connectivity and we have a little more eyes and ears. Second thing that differentiates us is we’re developers. The DNA of the firm is a series of entrepreneurs that have worked together since 1994. That thirty plus years of operating experience is not what you see at a generalist GP.

And so we can talk this business at a level that other GPs can’t. And when you’re sitting with an LP and you start going deep on our pipeline, how we build stuff, how we create opportunity, they see that difference. And we wake up every day, we’ve got three fifty people that focus just on this. Usually at a Blackstone or a KKR or GIP, they have four or five people working on digital. So we just have a lot more eyes and ears in terms of what we can do.

And then I think the real difference for LPs today is track record. And the number one thing you hear today, if you sit with any sovereign wealth fund, if you sit with any pension system, they say, have you returned capital to me? So this notion of that $9,000,000,000 of DPI that we’ve created in the last twenty four to thirty six months, Investors have taken notice of that. So as our fundraising has accelerated and we’re clearly punching above our weight class, $9,000,000,000 against $96,000,000,000 of assets under management, if you look at what On Tin put out last week, On Tin is a similar sized GP to us, they raised €1,800,000,000 last year. EQT raised like EUR 11,000,000,000 last year and they’re four times bigger than us.

So we’re clearly punching above our weight class in terms of capital formation, but that’s because we’ve returned capital. And then the last thing I would say about the fundraising environment that’s very interesting, this is kind of a trend in the last, sort of, I call twelve to eighteen months. Most big LPs, most big allocators around the world, whether you’re talking to sovereign wealth fund or you’re talking to a GIC and Adia or a Korean pension system, they’ll tell you, look, where we want to be in the next five years is we want less. So they’re actually pairing back the number of GPs they work with. When the common theme comes back, they say two things to me.

One, we want to be with the best of the best. We want to be with the big five. Someone joked to me once, nobody ever got fired by putting money in a Blackstone fund. Probably true, you’re not going to get fired by hiring Blackstone to do credit and private equity. The other trend that we see as they go to the big guys is, they want the industry specialist.

So specialization is key. So they’re pairing a generalist strategy with a specialist strategy. And the three areas that they talk the most about are power, digital and private credit. Those are the three hottest topics right now in fundraising. So we look at it and say, great, we’re the specialists.

We’ve got almost $100,000,000,000 of assets under management. The nearest specialist to us was IPI at $10,000,000,000 and they just got bought by Blue Owl. So there really isn’t a comp to Digital Bridge. So when I’m out fundraising, I’m actually not competing for Blackstone and KKR and Brookfield dollars. I was competing against other specialists, which really haven’t manifested.

So we do operate in the space where we really have a differentiated approach and we have a brand. I mean, there’s not right now today, 18 of the top 20 LPs in the world allocate with digital. So my focus is how do I grab the next two? I got to get to 20 out of 20. And our brand is well recognized.

And I think in our sector, in infrastructure and in alternatives, when it comes to digital investing, LPs are allocating with us. That’s the choice they make. So now we’ve got to go

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: out and perform. We’ve got to

Mark Ansey, CEO, Digital Bridge: keep returning capital. We’ve got to keep putting up the good returns. Our third fund is performing really well, performing better than our first and second fund so far. And so as long as we keep putting up returns and we keep putting money back into LP’s pockets, we’re going to continue to raise. And I always said the cadence is you got to kind of take one step back to go two steps forward.

So if I return $9,000,000,000 in three years, my goal is to go raise $18,000,000,000 in new fresh equity. And that’s what the algorithm has worked out for us, worked out really well.

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: And so maybe just to tie it all together with the algorithm, how should investors think about the progression of fee revenue and FRE growth at Digital Bridge? Both I mean, you’ve laid out 25 targets, but maybe if you could just leave us with what you’re looking at in terms of multi year growth profile for 2028?

Mark Ansey, CEO, Digital Bridge: Well, I think I’ve said it pretty clearly. I’ve sort of put out a marker that I think within three to five years, we should double our assets. Management. I think the initiatives that we have going in Power and Real Estate and our flagship fund really affords a steady cadence of going from $100,000,000,000 of assets to $200,000,000,000 in the next five years. We’ve generally been growing assets under management by $20,000,000,000 each year.

That’s kind of been the step function we’ve been on for the last three years. So with these new products coming into sharp focus, just the sheer volume of power that’s needed to power the AI economy, that intersection of pushing digital and power together is a place that we sit in a good spot. We now have experienced a few of these case studies where we’ve been able to build it off grid or behind the meter. And I think that’s a really big opportunity. And I think also, as we’ve talked about before, that cleanup trade where there’s $120,000,000,000 of stranded hyperscale data centers that other GP zone, we view our partnership with Goldman as a chance to go do a cleanup trade, go buy the best investment grade stabilized data center.

That’s a huge opportunity that no one’s really fishing at right now. So we think we’ve got two new swim lanes that allow us to go really fast. The flagship product is working. Our core fund is working. Our liquid strategies are running and credit is going incredibly well.

Our credit strategy has been by far our top performing fund, believe it or not, is Credit Fund One in terms of IRRs and plus that coupon that investors get. So, I said earlier at another investor conference last week, we’re at about $3,000,000,000 of assets under management credit. I’d like to double that this year. I think there’s a really good path for us to double our EUM and credit. And I think we can go raise more capital credit.

I think it’s a great place to end it, Mark. Thank you. Thank you.

Matt Niknam, Com Infrastructure Analyst, Deutsche Bank: Appreciate

Mark Ansey, CEO, Digital Bridge: it. Good to see you. Thanks, Matt.

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