Core Viewpoint - Sumitomo Mitsui Trust Bank and GCM Grosvenor have formed a strategic partnership to enhance alternative investment offerings in Japan, aiming to capture growing market demand and expand their global presence [1][2][3] Group 1: Partnership Details - The partnership aims to leverage SuMi TRUST's strong presence in Japan and GCM Grosvenor's expertise in private markets to develop and distribute alternative investment products [2][3] - Both firms are targeting an additional $1.5 billion in assets under management by 2030 as a result of this collaboration [2] Group 2: Company Backgrounds - SuMi TRUST Group is a leading trust bank in Japan with a diverse client base and one of the largest asset bases in Asia, focusing on asset management and wealth management [5] - GCM Grosvenor manages approximately $80 billion in assets across various investment strategies and has over 50 years of experience in alternative asset management [6]

Core Viewpoint - Sumitomo Mitsui Trust Bank and GCM Grosvenor have formed a strategic partnership to enhance alternative investment offerings in Japan, aiming to capture growing market demand and expand their global presence [1][2][3] Group 1: Partnership Details - The partnership aims to leverage SuMi TRUST's strong presence in Japan and GCM Grosvenor's expertise in private markets to develop and distribute alternative investment products [2][3] - Both firms are targeting an additional $1.5 billion in assets under management by 2030 as a result of this collaboration [2] Group 2: Company Backgrounds - SuMi TRUST Group is a leading trust bank in Japan with a diverse client base and one of the largest asset bases in Asia, focusing on asset management and wealth management [5] - GCM Grosvenor manages approximately $80 billion in assets across various investment strategies and has over 50 years of experience in alternative asset management [6] Group 3: Historical Collaboration - The two companies have been collaborating since 2016 in areas such as private equity, credit, and infrastructure strategies, indicating a strong foundation for this new partnership [3]

Core Insights - GCM Grosvenor has appointed Martin Laguerre as Co-Head of Global Diversified Private Equity, bringing 25 years of investment experience to the firm [1][2] - Laguerre's previous role was as a Senior Advisor at Warburg Pincus, and he has held significant positions at CDPQ, CPP Investments, and General Electric [2] - The firm currently manages $30 billion in private equity assets and has a total of approximately $80 billion in assets under management across various investment strategies [3][5] Company Overview - GCM Grosvenor is a global alternative asset management solutions provider with over 50 years of experience in alternatives [5] - The firm serves a diverse client base of institutional and individual investors, supported by a team of approximately 550 professionals [6] - GCM Grosvenor has a strong presence with offices in major financial hubs including Chicago, New York, Toronto, London, Frankfurt, Tokyo, Hong Kong, Seoul, and Sydney [6] Leadership and Strategy - Martin Laguerre will focus on enhancing GCM Grosvenor's private equity platform and leveraging the firm's extensive sourcing network [3] - The firm aims to strengthen its investment capabilities and deliver strong outcomes for clients through Laguerre's leadership [3][4] - Laguerre holds advanced degrees in finance and management, including an MBA from the University of Chicago [4]

Core Viewpoint - GCM Grosvenor has announced a strategic joint venture, Grove Lane Partners, to create a distribution platform for individual investors, focusing on registered investment advisors, independent broker-dealers, and family offices, in response to the growing demand for alternative investments among individual investors [1][3]. Group 1: Joint Venture Details - The joint venture will be led by Ryan Chapman, who has extensive experience in scaling alternative investment platforms and has previously worked at Blackstone [2]. - GCM Grosvenor holds a minority interest in the joint venture with an option to acquire full ownership in the future [4]. Group 2: Strategic Goals - The partnership aims to provide individual investors with access to institutional-quality private alternative investments managed by GCM Grosvenor and third-party managers [3]. - The initiative is designed to enhance GCM Grosvenor's capabilities in serving individual investors and to expand its channel reach [3][5]. Group 3: Company Background - GCM Grosvenor manages approximately $80 billion in assets across various investment strategies, including private equity, infrastructure, real estate, credit, and absolute return [6]. - The firm has over 50 years of experience in alternative investments and serves a global client base of institutional and individual investors [6][7].

Group 1 - David A. Johnson is the founder and principal of Endurance Capital Management, a New Jersey Limited Liability Company, with over 30 years of investment experience [1] - David invests in a diverse range of assets including stocks, bonds, options, ETFs, REITs, real estate, closed-end funds, hedge funds, and private credit [1] - He holds a Master of Science (MS) Degree in Finance with a concentration in Investment Analysis from Boston University, a Certificate in Financial Planning, and an MBA from Fordham University [1]

Core Insights - GCM Grosvenor announced the final close of its GCM Grosvenor Co-Investment Opportunities Fund III (GCF III), securing approximately $615 million in commitments, significantly higher than its predecessor, GCF II [1] - The firm's total private equity co-investment commitments now stand at $9 billion, reinforcing its leadership in co-investment strategies within a broader $30 billion private equity platform [1] Company Overview - GCM Grosvenor is a global alternative asset management solutions provider with approximately $80 billion in assets under management across various investment strategies including private equity, infrastructure, real estate, credit, and absolute return [4] - The firm has over 50 years of experience in alternatives and aims to deliver value for clients through a cross-asset class and flexible investment platform [4] Investment Strategy - Co-investments are increasingly recognized as essential for a diversified private markets program, with GCM Grosvenor offering differentiated access through robust sourcing capabilities, flexible structuring, and established partnerships [2] - GCF III attracted a diverse range of investors, including public, corporate, and Taft-Hartley pension plans, financial institutions, and family offices from North America, Europe, the Middle East, and Asia, focusing on middle-market growth and buyout transactions [3]

Financial Performance - For the year ended December 31, 2024, total management fees were $402 million, up from $375 million in 2023, representing a 7.2% increase [29]. - Total operating revenues for 2024 were $514 million, compared to $445 million in 2023, reflecting a 15.5% growth [29]. - Net income for 2024 was $19 million, an increase from $13 million in 2023, marking a 46.2% rise [29]. - Fee-related earnings for 2024 were $166 million, up from $140 million in 2023, indicating an 18.6% increase [29]. - Adjusted net income for 2024 was $141 million, compared to $103 million in 2023, representing a 36.8% growth [29]. - Management fees for the year ended December 31, 2024, were $387.0 million, up from $360.9 million in 2023 [47]. - As of December 31, 2024, the Fee-Paying Assets Under Management (FPAUM) was $64.8 billion, a growth from $48.9 billion at the end of 2018, representing a CAGR of 5% [151]. - The Contracted Not Yet Fee-Paying AUM (CNYFPAUM) reached an all-time high of $8.2 billion, up from $2.3 billion at the end of 2018, with management fees expected to be charged on approximately $1.0 billion in 2025 [152]. Assets Under Management (AUM) - As of December 31, 2024, the company had $80.1 billion in assets under management (AUM) [26]. - As of December 31, 2024, total Assets Under Management (AUM) reached $80.1 billion, with Private Markets accounting for $56.8 billion (71%) and Absolute Return Strategies for $23.3 billion (29%) of total AUM [34][35]. - The firm managed $30.4 billion in Private Equity strategies, $14.6 billion in Infrastructure strategies, and $5.9 billion in Real Estate strategies as of December 31, 2024 [37]. - Customized separate accounts comprised $56.7 billion (71%) of AUM, while specialized funds accounted for $23.4 billion (29%) as of December 31, 2024 [41]. - The company has $19.9 billion in AUM with small and emerging managers as of December 31, 2024, highlighting its commitment to innovative investment strategies [85]. - Total Sustainable Investments AUM reached $27.8 billion as of December 31, 2024 [37]. - Direct-oriented strategies AUM represented 52% of total firm AUM as of December 31, 2024, up from 39% as of December 31, 2020 [106]. - Infrastructure AUM increased by 144% to $14.6 billion as of December 31, 2024, compared to December 31, 2020 [93]. - Real estate AUM reached $5.9 billion, an 86% increase from December 31, 2020 [96]. - Absolute return strategies AUM was approximately $23.3 billion as of December 31, 2024 [98]. - Alternative credit strategies AUM stood at $14.6 billion as of December 31, 2024 [102]. Client Engagement and Retention - Existing clients contributed over 91% of total capital raised in 2024, with 50% of the top 50 clients by AUM engaging in multiple investment strategies [39]. - The company has a 90% re-up rate for customized separate accounts from January 1, 2018, to December 31, 2024, with $56.7 billion in AUM across 158 clients and 265 customized portfolios [64]. - Over the last three years, 72% of the top 25 clients expanded their investment relationship with the company, with 91% of gross capital inflows in 2024 coming from existing clients [78]. - Individual investors accounted for about 4% of AUM as of December 31, 2024, with $1.5 billion raised from individuals over the past three years [156]. - Client retention rates improved to Y%, reflecting the effectiveness of recent customer engagement strategies [15]. Strategic Initiatives and Future Outlook - The company aims to expand its product offerings and grow its international investor base as part of its future strategy [18]. - The company launched the Elevate strategy in 2022, closing its first fund in 2024 with approximately $800 million in capital [85]. - The company is focusing on expanding its market presence, with plans to enter new geographic regions by QX 202X [15]. - New product offerings are expected to launch in QX 202X, aimed at enhancing client engagement and satisfaction [15]. - The company has outlined a strategic plan for potential acquisitions to bolster its service capabilities and market share [15]. - Future earnings guidance suggests a projected revenue increase of X% for the upcoming fiscal year [15]. - The company anticipates a continued positive trend in market conditions, supporting its growth objectives for the next fiscal year [15]. Operational and Compliance Aspects - The company employed 549 individuals, including 181 investment professionals, as of December 31, 2024 [28]. - The operations team consisted of 299 professionals, ensuring a robust internal control environment [164]. - The compliance team is responsible for ensuring adherence to federal, state, and international regulations applicable to the business [184]. - The company is subject to various privacy and cybersecurity regulations, including the California Consumer Privacy Act and the EU General Data Protection Regulation [202]. - The exit of the U.K. from the EU has resulted in greater complexity and operational costs for maintaining regulatory compliance [194]. - The company’s funds are generally subject to significant regulation designed to protect investors, including limitations on borrowing and leveraged capital structures [198]. Investment Performance - The company achieved an annualized return of 20.8% for co-investments/direct investments since inception in 2009, outperforming the S&P 500 by 5.9% [69]. - The absolute return strategies had assets under management of $23.3 billion as of December 31, 2024, with a one-year net return of 11.4% and a five-year net return of 6.1% [144]. - The infrastructure investments showed a net IRR of 12.1% and a net TVPI of 1.46, with total contributions of $6.7 billion and distributions of $4.4 billion [143]. - The secondary investments in private equity had commitments of $2.2 billion, contributions of $2.0 billion, and distributions of $1.1 billion, yielding a net TVPI of 1.45 and an IRR of 14.8% [143]. - GCM Grosvenor's real estate investments had total commitments of $4.965 billion, contributions of $3.870 billion, and distributions of $1.848 billion, resulting in a net TVPI of 1.15 and an IRR of 7.0% [143].

Financial Data and Key Metrics Changes - In Q4 2024, fee-related earnings increased by 22% and adjusted net income rose by 63% compared to Q4 2023 [8] - For the full year 2024, fee-related earnings grew by 19% and adjusted net income increased by 36% over the prior year [8][9] - The fee-related earnings margin was 42% for the year, up from 38% in 2023 and 31% at the end of 2020 [10] Business Line Data and Key Metrics Changes - Total fundraising reached $7.1 billion in 2024, a 40% increase compared to 2023, with Q4 fundraising of $2.3 billion being the highest in over two years [10][11] - Fundraising for specialized funds amounted to $1.9 billion, marking the second highest year on record [12] - The credit investment platform raised $1.8 billion, accounting for over 25% of total funds raised in 2024 [15] Market Data and Key Metrics Changes - Assets under management (AUM) ended the year at $80 billion, with fee-paying AUM at $65 billion [30] - Contracted not yet fee-paying AUM increased by 12% year-over-year, reaching a record level of $8.2 billion [31] Company Strategy and Development Direction - The company aims to double its 2023 fee-related earnings by 2028, with confidence in achieving this target despite non-linear growth [9][19] - Expansion of product offerings and distribution in the individual investor channel is a priority, with a new infrastructure interval fund launched [18][87] - The company is focusing on enhancing its credit strategies and absolute return strategies, which have shown improved performance and demand [15][16][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth targets, citing strong fundraising and a robust late-stage pipeline for 2025 [11][19] - The macro environment is seen as favorable for continued growth, particularly in private credit and infrastructure [26][63] Other Important Information - The company reported $55 million in annual performance fee revenue, marking the third time in five years that performance fees exceeded $50 million [16][38] - The balance sheet remains strong, with a quarterly dividend of $0.11 per share and a recent increase in the share repurchase program by $50 million [40][42] Q&A Session Summary Question: FRE margins outlook - Management indicated that they expect continued operating leverage and margin expansion, potentially reaching the mid-forty percent range [46][48] Question: Fundraising cadence for 2025 - Management noted that 2025 is expected to be better than 2024, with a strong pipeline and re-up calendar [50][56] Question: Conversion from pipeline to fee-paying AUM - Management discussed the importance of the macro environment and the types of funds raised in determining the conversion rate [60][64] Question: Changes in absolute return business dialogue - Management acknowledged that good performance has led to a more positive dialogue with clients regarding absolute return strategies [70][72] Question: Retail vehicles and distribution channels - Management clarified that significant revenue contribution from the new infrastructure fund is not expected in 2025, but they are optimistic about its long-term potential [84][86]

Core Insights - GCM Grosvenor Inc. reported a revenue of $165.26 million for Q4 2024, marking a year-over-year increase of 41.8% and an EPS of $0.27 compared to $0.17 a year ago [1] - The revenue exceeded the Zacks Consensus Estimate of $164.59 million by 0.41%, while the EPS surpassed the consensus estimate of $0.24 by 12.50% [1] Financial Performance Metrics - Fee-paying AUM for Private Markets Strategies was $42.72 billion, below the average estimate of $43.88 billion [4] - Total Fee-paying AUM reached $64.77 billion, slightly lower than the average estimate of $65.32 billion [4] - Fee-paying AUM for Absolute Return Strategies was $22.05 billion, exceeding the average estimate of $21.44 billion [4] - Total Assets Under Management stood at $80.08 billion, compared to the average estimate of $81.33 billion [4] - Other operating income was reported at $1.10 million, slightly above the average estimate of $1.09 million [4] - Incentive fees amounted to $56.78 million, below the average estimate of $58 million [4] - Management fees were reported at $107.38 million, exceeding the average estimate of $101.98 million [4] Stock Performance - GCM Grosvenor's shares returned +6.3% over the past month, outperforming the Zacks S&P 500 composite's +2.1% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Insights - GCM Grosvenor Inc. reported quarterly earnings of $0.27 per share, exceeding the Zacks Consensus Estimate of $0.24 per share, and showing an increase from $0.17 per share a year ago, resulting in an earnings surprise of 12.50% [1] - The company achieved revenues of $165.26 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 0.41% and up from $116.56 million year-over-year [2] - GCM Grosvenor shares have increased approximately 10.5% since the beginning of the year, outperforming the S&P 500's gain of 2.5% [3] Earnings Outlook - The company's future stock performance will largely depend on management's commentary during the earnings call and the revisions of earnings estimates [3][4] - Current consensus EPS estimate for the upcoming quarter is $0.18 on revenues of $136.49 million, and for the current fiscal year, it is $0.81 on revenues of $580.52 million [7] Industry Context - The Financial - Investment Management industry, to which GCM Grosvenor belongs, is currently ranked in the bottom 26% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact GCM Grosvenor's stock performance [5][6]