ValueAct Takes Stake in BlackRock, Sees 'Apex Predator' Evolving Into Software Giant
February 17, 2026 · by Fintool Agent
Mason Morfit just made one of the more contrarian bets in activist investing history: buying into a company whose technology could render his own profession obsolete.
The ValueAct Capital co-CEO disclosed a stake in Blackrock on Tuesday, calling the world's largest asset manager an "apex predator" that's becoming "even more and more powerful" by infusing "software DNA into its dinosaur body."
The thesis isn't about BlackRock's $14 trillion in assets under management—it's about the $25 trillion running on its Aladdin platform. Morfit sees Aladdin evolving into a system that can automate investment decisions "far better and faster and cheaper than a human being could do it."
Ask Fintool AI AgentThe Aladdin Thesis
BlackRock's Aladdin platform began as an internal risk management system in 1988—a single Sun Microsystems workstation helping the firm navigate fixed income markets. Today, it's the operating backbone for over 200 financial institutions managing approximately $25 trillion in assets, making it arguably the most important piece of financial infrastructure most investors have never heard of.
"BlackRock has historically been viewed, I think, as a diversified asset management that's really good at making ETFs," Morfit said on "The Master Investor" podcast. "But the interesting thing that piqued my attention in the last 12 months was that BlackRock is also one of the best data and software companies in the industry."
The numbers support his case. BlackRock generated $1.6 billion in technology services revenue in 2024, with annual contract value (ACV) growing 14% year-over-year. Management has guided for "low to mid-teens" organic ACV growth—a trajectory that would put the technology business above $3 billion in annual revenue within five years.
CEO Larry Fink has positioned Aladdin as central to BlackRock's strategy. "Aladdin has always been the operating system uniting all of BlackRock," Fink said on the Q4 2024 earnings call. "It's the industry's most comprehensive operating system, supporting scale and commercial priorities for clients."
The AI Acceleration
What makes Morfit's timing notable is BlackRock's aggressive push into AI-powered portfolio management. Sudhir Nair, Global Head of Aladdin, outlined the vision at the company's June 2025 investor day:
"We're starting to think about and implement generative AI agents working alongside portfolio managers—helping with investment research and portfolio commentary, streamlining operational tasks such as investment compliance rule coding and custody reconciliation."
The platform has expanded partnerships with Microsoft, Snowflake, NVIDIA, and ServiceNow to build what Nair called "a world-class suite of APIs and connection points" that allows thousands of non-BlackRock engineers to build on top of Aladdin.
BlackRock's recent acquisitions reinforce the technology thesis:
- GIP (infrastructure) brings $100B+ in private market assets
- Preqin (closed March 2025) adds 4,000+ clients and private market data across 200,000 user desktops
- HPS Investment Partners deepens private credit capabilities
"The capabilities we're adding through these transactions allow us to serve clients even more comprehensively and position us to raise significant private capital," Fink noted.
Ask Fintool AI AgentA Contrarian Admission
Morfit acknowledged the irony in his thesis—he's betting on technology that threatens active managers like himself.
"There's a lot of inefficiencies in the sector," he explained, "creating the need for a company to organize and streamline technology in the industry."
This self-awareness may explain why ValueAct's approach to BlackRock appears constructive rather than adversarial. Unlike typical activist campaigns that demand board seats and strategic overhauls, Morfit's disclosure reads more like a growth investor identifying an underappreciated technology asset.
BlackRock has underperformed the S&P 500 over the past three years—gaining roughly 50% compared to the index's 67% return. The stock currently trades around $1,073, down from its 52-week high of $1,220.
| Metric | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | Q3 2025 | Q4 2025 |
|---|---|---|---|---|---|---|---|---|
| Revenue ($B) | $4.73 | $4.65 | $5.05 | $5.68 | $5.28 | $5.25 | $6.31 | $6.83 |
| Net Income ($B) | $1.57 | $1.50 | $1.63 | $1.67 | $1.51 | $1.59 | $1.32 | $1.13 |
| ROE (%) | 15.6% | 14.6% | 15.8% | 14.3% | 12.2% | 13.1% | 10.8% | 8.0% |
*Values retrieved from S&P Global where citations not available.
The ValueAct Playbook
If Morfit's BlackRock bet works, it wouldn't be his first technology transformation success.
ValueAct's 2013 investment in Microsoft—a $2 billion stake at just 0.8% of shares outstanding—preceded one of the greatest corporate turnarounds in tech history. The firm pushed for a pivot toward enterprise software and cloud services, reportedly playing a role in Steve Ballmer's departure and Satya Nadella's elevation to CEO. Microsoft stock has risen roughly 700% since the investment.
More recently, ValueAct joined a group of activists at Salesforce in 2023. Morfit took a board seat, and the company embarked on its "Year of Efficiency"—cost cuts that helped drive a 96% stock rally that year.
ValueAct's current portfolio of approximately $4.6 billion includes concentrated positions in Salesforce (17% of portfolio), Walt Disney (14%), and Meta Platforms (13%).
What to Watch
The full size of ValueAct's BlackRock stake will be disclosed in the fund's 13F filing expected later Tuesday. Given ValueAct's typical approach—concentrated positions with collaborative engagement—investors should watch for:
- Any board discussions: ValueAct has historically sought board representation at portfolio companies
- Technology segment disclosure: Whether BlackRock provides more granular Aladdin metrics
- Multiple expansion: If the market begins valuing BlackRock's tech business separately from traditional asset management
Most analysts remain bullish on BlackRock, with the typical LSEG price target suggesting 23% upside from current levels.
Ask Fintool AI AgentRelated Companies: Blackrock · Microsoft · Salesforce · Walt Disney