GCM Grosvenor at Morgan Stanley Conference: Strategic Insights on Growth

On Tuesday, 10 June 2025, GCM Grosvenor (NASDAQ:GCMG) participated in the Morgan Stanley US Financials, Payments & CRE Conference 2025. John Levin, President of GCM Grosvenor, provided a strategic overview of the company, highlighting its strengths as a global alternative asset manager with $82 billion in assets under management. Levin balanced optimism about future growth with acknowledgment of current market challenges, emphasizing GCM Grosvenor’s unique solutions-provider model in the alternative investment landscape.

Key Takeaways

• GCM Grosvenor manages $82 billion in assets, focusing on customized solutions across various investment strategies.
• The company aims to double its Fee Related Earnings (FRE) by 2028.
• Infrastructure and private credit are expected to drive growth in the coming years.
• The firm is expanding its reach in the individual investor market.
• GCM Grosvenor maintains a 90% re-up rate with customized separate accounts.

Financial Results

GCM Grosvenor reported $82 billion in assets under management, with 75% delivered through customized separate accounts. The company is targeting a doubling of its Fee Related Earnings (FRE) over the next five years. A shift towards higher-fee, direct-oriented strategies is enhancing margins. Infrastructure assets under management have grown significantly from $2 billion to $15 billion in six to seven years.

Operational Updates

GCM Grosvenor operates as a solutions provider, offering tailored investment portfolios that include co-investing, secondary investing, and direct investing. The firm’s open architecture allows for diverse implementation of alternative investments. Recent developments include the launch of an infrastructure interval fund and a joint venture with Grove Lane to collaborate with Registered Investment Advisors (RIAs). Despite a slowdown in capital market activity, the company continues to see growth in customized separate accounts and direct-oriented strategies.

Future Outlook

Levin expressed confidence in the company’s long-term business plan, predicting better fundraising outcomes in 2025 compared to previous years. Infrastructure and private credit are anticipated to remain active areas. The firm aims to double its FRE by 2028, with growth expected in the individual investor market. GCM Grosvenor’s diversification across asset classes and geographies positions it well for future opportunities.

Q&A Highlights

During the Q&A session, Levin highlighted the evolution of individual investor portfolios to resemble institutional portfolios in terms of diversification. The firm’s separate account capability is well-received in the RIA market. Levin noted the potential for growth in the secondary market and expressed confidence in achieving the FRE doubling goal, citing multiple pathways to success.

For more detailed insights, please refer to the full transcript below.

Full transcript - Morgan Stanley US Financials, Payments & CRE Conference 2025:

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: All right, great. Before we get started, for important disclosures please see the Morgan Stanley Research Disclosure website at www.morganstanley.com/researchdisclosures. The taking of photographs and use of recording devices is also not allowed. If you have any questions, please reach out to your Morgan Stanley sales representative. Good afternoon and thanks for joining us at the Morgan Stanley Financials Conference.

I’m Stephanie Ma, member of the brokers, asset managers and exchanges team for Morgan Stanley Research. For our next session, it’s my pleasure to welcome John Levin, President of GCM Grosvenor. GCM Grosvenor is a global alternative asset manager with about $82,000,000,000 in assets under management across private equity, infrastructure, real estate, credit, and absolute return investment strategies. So with that, thanks for joining us today, John.

John Levin, President, GCM Grosvenor: Thank you for having me.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: Great. Maybe just as an overview while we get started, as a solutions provider, you’re a bit different from the Blackstone’s and the KKR’s of the world, the GPs as they’re known, as you allocate capital on behalf of clients managed by the GPs. So could you tell us a little bit more about what this means in practice and are there different ways your clients can engage with you, either through SMAs or commingle funds?

John Levin, President, GCM Grosvenor: Great, thank you. Yeah, I think where we sit in the, make sure you can hear me okay, where we sit in the alt ecosystem is often referred to as the solutions provider space, which as you noted, is distinct from some of the large GPs as they’re referred to. I think one of the interesting parts of that question is oftentimes people might think that those concepts or at least those allocations are mutually exclusive. And the reality is they more often than not, in nine out of 10 cases coexist. As a solutions provider, what you’re typically doing, and the name fits well, is providing some sort of solution, investment portfolio, manufacturing answer that’s hard for that particular investor, that institution, that individual investor, whatever it might be, to create on their own.

As you pointed out, sometimes that investment answer involves allocating capital to other people’s funds. It also involves co investing in specific assets and securities companies. It involves secondary investing. And to some extent, in our case, depending on the vertical, it involves some direct investing as well. And that open architecture approach or that kind of ability to implement alternative investments in multiple different ways is actually a core competitive advantage of ours.

And that answer, that solution that you can provide can be packaged, to your point, in any form. It can often be the case, in our case, about 75% of our assets. It can be delivered through a customized separate account. And that also our manufacturing capabilities can be provided to clients through various coming old fund offerings as well. I think the important probably point I would leave you with on this general topic is the ability to invest across the alt spectrum from liquid to private, from credit to equity, from fund investing to co investing to secondary investing to direct investing, and then the ability to deliver that capability to investors in different packaging, so to speak, it really enables us to kind of sit at any table where an alt conversation is happening and be relevant.

And provides us with a kind of a tremendous seat with inside of what’s obviously a very attractive ecosystem generally.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: Yeah, that’s a great overview. We’ll dive into each of those verticals a little bit later, but maybe let’s just set the stage with the overall macro environment. Clearly, a lot of concerns around trade policy, interest rates, economic growth that’s weighing on public market volatility. Can you talk about the implications on your business model as a solutions provider? And are there any differences in terms of impact when we contrast you guys versus some of the GPs that we just spoke about?

John Levin, President, GCM Grosvenor: I suppose it would be irresponsible to admit that I don’t read the news anymore just because it’s hard to keep up with. But I obviously joking, but in serious what I do think is important is to, and we talked about this actually on our last earnings call as a firm and as leaders of an organization, something we’re very focused on, our job is to keep laser focused on our clients. It’s very easy to get distracted because there’s a lot going on. There’s a lot going on geopolitically in the world. There’s a lot going on domestically.

And we have to stay calm and focused and measured on the goal that we have, which is to deliver for our clients and deliver for our people and deliver for shareholders by focusing on executing the business plan. And that’s not to say that we’re immune to events of the world. Of course, we all understand what it’s like to be in uncertain environments. We understand what it’s like to have market volatility that we’ve experienced. But I will say that none of what’s happened over the past four months, five months, six months, whatever period of time we want to look at, in my opinion, changes anything truly fundamental about our business plan, about the value proposition that we have for clients, about where we’re investing in the business for future growth.

But it does have impact on capital markets activity. So less capital, less deals get done, less capital gets deployed. There’s less realizations that are happening in the marketplace generally, and that’s an issue that faces certain clients. We have found ourselves in a place where from a capital formation perspective, from a fundraising perspective, and this is honestly what we predicted would happen is that ’24 would be better than ’23, ’25 would be better than ’24, And that seems to be holding true. And I think a lot of that is a function of the diversification of our business by asset class.

I think it’s a function of the diversification of our business by geographic and client type. I think it’s a function of the customized separate account business and the programmatic nature of the business that we’ve been able to, despite some challenges around slower realizations and slower DPI or capital return to investors, continue to see a tremendous amount of growth and opportunity through that environment. But it’s definitely when it comes to making investments, deploying capital, you have to consider the environment around what is your cost structure going to be because of trade or tariff policy or what’s your cost of capital going to be depending on what your view of the ten year is based on these different policies. And I do think that that causes the cycle of deal activity or capital market activity to slow a bit. Do I think it fundamentally changes the long term value and the NPV value of these businesses in the alt space or our business in particular in any material way?

Not really.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: Yeah. Maybe just diving into your fundraising expectations. Despite market headwinds you just mentioned, you expect 25 fundraising to be better than 24. So maybe just double clicking into that, what’s driving that level of confidence? You spoke to the diversification of the business, but maybe you can also give us a flavor of the key contributors underpinning this outcome.

John Levin, President, GCM Grosvenor: Sure. I think for us, one of the benefits of the nature of the business that we have is a tremendous amount of predictability and transparency into the the pipeline of activity. So when you’re in the customized account business, for example, which represents 75 or so percent of our assets under management, you know when your re up cycles are occurring, when clients are having board meetings, and when they’re expecting to sign documentation. And so we can have, you know, it could be off by a month or something. Yeah.

But within any reasonable period of time, you can have pretty good predictability in that. You also know what you’re in market with from a specialized fund perspective. And we’ve been in a fortunate place where every single, except for one instance out of dozens of them, every single subsequent commingled fund we’ve had has been larger than its predecessor fund. And so you can think about what that calendar looks like to give you insights into the fundraising picture. I think though, when you dig into what’s driving the activity and where you’re seeing the most activity from investors, I would say that infrastructure and private credit continue to be very active areas.

I think not surprisingly, those are both active areas because they are less mature allocations for the typical investor, whereas in private equity, you might be full mature allocation and therefore have to think a little bit more about the realizations coming back in your cash flow planning or capital planning. And infrastructure and credit tend to still be building allocation. And so we’ve seen a lot of activity there. I think from an implementation style standpoint, we’re still seeing more of our activity and a growing percentage of our activity be towards what we call direct oriented strategies. So co investment secondary, control investing as distinct from allocative activity or fund activity.

And so those are a couple of the trends we’re seeing. And if I look forward over the next few quarters or a couple years even, maybe what it would be, I think some of those trends are still going be the same ones, actually, in terms of where we see the growth and the drivers.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: You sound pretty confident for your fundraising. But if we take a step back and look at the industry, we’ve going on four years now of limited cash distributions back to the LPs. So I guess from your seats, what are you hearing from institutional asset owners? How are they navigating? And then more broadly, how mature or saturated are private market allocations today?

John Levin, President, GCM Grosvenor: Yeah, so I think there is no question that the pace of realization or activity over the last years has been slower than it was in prior periods. I will say just on that note, what we did see in the late teens, early twenty twenty’s ignoring COVID a little bit was an acceleration of the cycle that was not sustainable. That wasn’t normal either. Meaning private equity firms, for example, going out and raising funds that are 50% bigger and doing it every three years and holding assets for three years, that also isn’t normal. So we’re on a slow end of it, but we’re not going back.

The expectation of going back to that type of cycle shouldn’t be anyone’s expectation. So the idea that you raise funds every four or five years and hold assets for five, six, seven years, that’s a very healthy environment to be in. It is an issue that faces clients today with respect specifically to their private equity portfolio. I don’t think you see the issue as much in the other asset classes. But I also think that the issue is, the most important thing is are the investments adding value.

Right? So if you’re not exiting an investment, but you’re compounding value, there’s nothing really wrong with that. Right? That’s not a valuation issue. That’s not an asset class issue.

That’s not a performance issue. It’s a cash management or it’s a liquidity challenge that you have to do. And so far, what we’ve seen at least in our own portfolios and for our clients is that the alts portfolios are generally performing fine, performing well. Our clients are satisfied with their alts portfolios. They want to keep their allocations.

They want to grow their allocations. And so you do have to worry that if you’re not compounding value while you decay time, that that’s a challenge. I’m sure that’s happening in some people’s portfolios. But for us, I think what we have to focus on is driving that risk return value proposition for our clients, providing the programmatic exposures that they’re kind of looking for us to do. And I think that whether it’s the large GPs that you started out with your question with, or the solutions providers tend to be much more immune to some of those more cyclical challenges than maybe the marginal allocation that an institutional investor and individual investor may have been making.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: And then maybe broadly on private market allocations. Are there pockets of LPs where they’re

John Levin, President, GCM Grosvenor: over think of of course, there are some. I’ve been doing a lot of traveling over the past five months around the world. I can’t think of any really significant or material over allocation stories. I really can’t. I think people are at allocation.

And when I say that, maybe they’re a little above, they’re at the top end of the range, but they’re okay with that. They don’t want to come down necessarily because the alts are performing for them. And there’s much more stories out there around not even being anywhere close to where they want to be in allocation. Whether that’s a new institutional balance sheet that comes online that still might be building to where they want to go from an alt standpoint, whether it’s places where you’re generating excess capital from whatever’s going on inside of your ecosystem, whether it’s the individual investor, which I’m sure we’re going to talk about shortly, that’s nowhere near where they want to be. So there’s just so much growth opportunity, I think, from the alt space.

And I think one other point I would just make is even for someone that’s fully allocated to private markets, that’s someone who’s growing their private market allocation by whatever your capital markets assumption is. So your fully allocated client is growing by six, seven, eight, whatever you think equity markets or markets are gonna be. You know, your kind of base case, no growth, no taking further share growth being three times GDP is not like the worst place to be. Pretty good. It’s a pretty good market.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: Sure. Maybe shifting gears a bit. One of the interesting aspects of your story is a double mix shift story. This is growth in private markets and also more direct oriented strategies. So what’s driving this mix shift?

And what are the benefits to both top line growth and also margin?

John Levin, President, GCM Grosvenor: Sure. So maybe I’ll start with the private markets growth. It’s just, so we, as we talked about at the outset, cover all the alt strategies, which make us pretty unique in the marketplace in terms of being able to provide both liquid alt solutions as well as private market alt solutions. And it’s a fact that the private markets area of the alt ecosystem has been going faster than the liquid side. So our private markets business has been becoming a bigger composition of our overall AUM revenue, FPOM, etcetera.

Interestingly, I know this wasn’t your question, I’ll come back to the direct oriented, the part of our business that’s driven by absolute return strategies are liquid alt investments, which tends to have been less in favor over the past number of years, is actually an area where we’re seeing a lot of activity today. Not surprising to us, it’s an area where the absolute returns, relative returns have been very good over many recent quarters. It’s been an interesting period of time to see how in some of the big drawdowns we’ve seen intra month or intra quarter, absolute return strategies have protected capital in a really significant way, which has been helpful to investors. There are certain investors that would rather not get more illiquid right now. And so the idea that you can get some active management, alpha generation, return generation through a more liquid part of the ALTS portfolio is interesting.

And so I’m not calling for the liquid ALTS to grow faster than the private markets. I still private markets will grow, you’ll still see half of that double mix shift occurring. But it has been an interesting space over the recent period of time. When it comes to the direct oriented strategies, that is picking up co investing, secondary investing, direct investing as distinct from allocative investing or primary fund investing where we’re giving capital to other managers. And that’s really honestly where all things start with us, driven by the client.

Meaning, of course, we have to feel good about our manufacturing capabilities. We have to be ready ahead of the client in terms of making sure that the origination is there, that the execution, that the returns are there, which is and then when the clients are ready, you’re able to help them evolve their portfolios. And so as clients add more of that co investing strategy, of the secondary investing strategies, we’re obviously a beneficiary of that and are able to evolve with them and grow those pieces to be a larger percentage of our pie. Those strategies tend to be higher fee, are higher fee strategies for the firm and so it also has the benefit of providing some growth, excess growth from that and operating leverage and margin enhancement from that as well.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: Got it. Another stool of your business is your focus on customized separate accounts, which represents 70% of your AUM. You frequently highlight the stickiness of these client relationships and also the perpetual nature of these re ups. So maybe you can talk about what differentiates your approach to customize separate account model that’s led to the successful 90% re up rate.

John Levin, President, GCM Grosvenor: Yeah, so I think the thing I would say is we have certain manufacturing capabilities, right? We talked about those private equity infrastructure, real estate, credit, absolute return strategies, and within that codes, secondaries, direct funds. And then you have the ability to deliver those manufacturing capabilities to clients with all different wrappers. So you have the ability, and I’ll go into this in more detail, customize separate account. That makes sense for certain clients.

By the way, that makes sense for institutional clients. It makes sense for certain parts of the individual investor market, which I’m sure we’ll come and talk about. Then you can offer commingled funds that are not registered. You can offer commingled funds that are registered, again, to individual investor. And so that flexibility of how you deliver your capabilities is super important.

Within the customized separate accounts, I think the thing that honestly really differentiates us more than anything else is the fact that we’ve been, it’s been a huge part of our business for thirty years. I don’t think that you can wake up in the morning and say I want to be in the customized separate account business. I’m not saying it’s rocket science. You can learn how to do it. You can have it become part of your process.

You can have it be part of your culture. But it does need to be part of your culture. People have to want to interact with clients on a regular basis to deliver that customized service and customized solution. You have to have it built into your processes so that you can have a bunch of different custom accounts but still scale your business. Operational processes, investment processes, portfolio management and allocation processes.

And so I think the biggest thing that differentiates us is the experience of having done it for thirty years. A lot of people don’t know this story. But our custom account was actually with a Japanese financial institution in the early mid nineteen nineties. And this was an institution that wanted to create an alts portfolio. And they told us we’re going to create this alts portfolio with you.

You’re going to obviously and foremost focus on generating the risk return that we’re all setting out to do. But you’re going to also service the heck out of us. You’re going to train our team. You’re going to have radical transparency on everything you’re doing. You’re going to host internships.

We’re going to have knowledge transfer. We’re going have people come to your office. You’re going come to our office and after three years we’re going to fire you. There’s still a client today. And so that kind of mentality of constantly evolving with the client, constantly making sure that you’re driving the value proposition with the client, that you’re listening to the client and working with them allows you to sustain those relationships, re up those relationships, and create that stickiness and that perpetual nature that you refer to.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: Right. Maybe let’s turn to the individual investor, which we’ve been bread crumbing our audience for twenty minutes now. You’ve made significant progress in the individual investor channel over the last twelve months. You’ve launched your infrastructure interval fund and also formed a joint venture with Grove Lane. Can you talk a little bit more about the progress you’ve made so and your aspirations in private wealth over the next three to five years?

John Levin, President, GCM Grosvenor: Maybe I’ll start with, if it’s okay with you, just kind of our thesis on entering the market. Meaning our confidence level and our commitment to invest significant amounts of time and resources and capital and all those things that are necessary to be good at anything comes from a place of starting with the client. As I’ve said a few times in this session, which is if it’s not right for the client and you’re not providing a value proposition for the client, it’s not going to be a persistent value creating strategy for the business. And it’s our strong view that when you look at the alts portfolio of an individual investor several years from now, whether that individual investor is accessing those alts through relationship or through an RIA or on their own somehow through an independent broker dealer or through eventually maybe more four zero one ks or entire good day fund, whatever the mechanism is or however they’re reached, that that portfolio is going to look not completely necessarily exactly like, but more like what an institutional portfolio looks like in terms of their alt implementation today versus how the individual investor portfolio currently looks.

Meaning there’s a lot of discussion right now around there’s five firms or six firms that are getting 90% of the activity. And if you look at the individual investor’s portfolio, they might own two BDCs or a REIT or one interval fund from I’m sure many firms that are at this conference and they might have four positions. Well if you look at some of the most sophisticated, well staffed, analytical institutions in the world that have been investing in alts for thirty years, forty years, fifty years, and have dozens of consultants and risk managers and all different types of talent that have come through the organization, none of them have decided after thirty or forty or fifty years that they should own three products for their alts implementation. None. Not one or two.

None. And so my view over time is that we’re in the very early innings of this, that the solutions providers, just like they play, if we’re really all kind of acting in the way that we speak, which is we really want to give the individual investor the same experience that the institutions have, over time they’re going to have more diversified portfolios with different types of They’re gonna have large cap and mid cap and small cap. And they’re gonna have different geographic exposures. And within infrastructure, they might have core and core plus and value add and opportunistic.

Do I think they’re necessarily gonna wake up one day like some really big institution have like 600 manager relations? No. Because operationally, that would be too hard. But going to have more than three and they’re going to have more than four. And I think that the solutions providers in particular, I’ll put ourselves squarely in that bucket, can play a very meaningful role in that very, what I think is positive evolution of that experience for the individual investor, which is the most important outcome, is that the actual experience, risk adjusted returns that are being generated by the alts portfolios for the individual investor look like what has been so successful in the institutional space for decades now.

And so that’s place that we come from as we decide to make commitments into the space. And I think our commitments are going to be many fold in the sense that you’re going to have resources focused on wires. You’re going to have grove lane types of partnerships that are going to work on the RIAs. On certain products, you might partner with distributions like we have with our infrastructure fund. All the different things that we’re all reading about every day in the news, whether it’s a private asset manager partnering with a traditional asset manager, or setting up a JV on a product, or setting up a JV on a bid, they’re all different ways of leveraging and creating distribution to meet different parts of the market.

They’re not mutually exclusive. And we’re kind of fully committed to making sure that we’re an active participant in that space.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: And any color you’d like to add on the recent infrastructure enrollment?

John Levin, President, GCM Grosvenor: The recent infrastructure fund open for sales now. As we’ve said before, the early receptivity, because we launched a product that was seeded with capital and importantly seeded with investments, has been fantastic. I think it was maybe open for sales. I’ll get this wrong, but it’s like weeks, not months. And do I think it’ll be meaningful to our financials over the next several quarters?

No. But do I think the initial receptivity is excellent? I do. And I’ve been in some of those meetings where how we’ve created that product, which again, it comes back to the mindset of when we’ve designed that product, said what has been so successful in the institutional space that’s allowed our infrastructure business to go from $2,000,000,000 or so six or seven years ago to $15,000,000,000 today? Let’s do that same thing for the individual investor.

And that’s the way to approach that market. The other thing, which is I wouldn’t say is necessarily a surprise to us because we thought about it, but maybe a surprise to you or some folks in this room. The other area as we’ve kind of spent more and more time in the individual investor market, in particular more and more time in the RIA market in recent period of time, a tremendous amount of openness and receptivity to our separate account capability. Which isn’t intuitive to people because people think, a retail investor, have $5,000 or $10,000 or $25,000 or $100,000 whatever it might be, dollars 1,000,000, how can you do a separate account? And think about it as, you know, people use the term model portfolios.

That can mean certain things to certain people. I would just think about it as white labeling solutions or customizing solutions. So you could go to a, let’s use an RIA firm as an example, or let’s use an advisor at Morgan Stanley for an example. And they might have many dozens of clients that could allocate a million dollars. And the aggregation of those can create a custom solution or a white labeled solution for that particular advisor or that particular IRA firm, I think that we’re going to see a tremendous amount of our success in the individual investor channel come from that.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: Great. Maybe coming back to infrastructure and private credit, both asset classes are in early innings in terms of LP allocations and they enjoy attractive tailwinds right now. Just remind us of your offerings here and how you view the firm position to participate in this growth. Sure.

John Levin, President, GCM Grosvenor: So our offerings in both places and I’ll kind of differentiate between the two mirror what our offerings are in all of our asset classes in the sense that A, we have fund investing capabilities B, co investment capabilities B, secondary capabilities and then D, direct investing capabilities in those markets. The other commonality across both verticals is that typically, at least when it comes to the fund investing and the other kind of implementation styles therefore kind of logically follow, people aren’t looking to us to be at the kind of super large end of the market, trying to help with middle market types of exposures. I think when it comes to infrastructure in particular, because I think there’s some different trends in private credit I’ll come to in a minute, what we’ve been able to do is learn from many, many, many years of private equity experience to create a value proposition that’s similar but kind of evolved on a faster curve, so to speak. So as in private equity, maybe for the several decades of that market, was just a fund investing market. Then secondaries, then co investments.

Well in infrastructure, because it had private equity before it, that whole evolution happened in a much shorter period of time. So when you look at, for example, our infrastructure business, it might be 75 percent direct oriented versus 25% allocative. The inverse would be the case in private equity. Right, so because it just all happened a lot faster. So that kind of asset heavy as opposed to fund investing approach is particularly unique to our clients because you’re getting the kind of asset approach in the sense of you’re talking about not funds, you’re talking about specific infrastructure deals.

You’re getting it in a really wildly diversified way. And so you’re getting the net returns that are competitive with any GP or direct fund out there because of the way the fee load, the better net returns I should say, because the fee load is different than what you have from a direct fund and it’s more diversification. And so that kind of mousetrap, whether it’s being delivered in a customized account form or in an institutional commingled fund form or in the individual investor register form like our product with Sion has really resonated well for investors. In particular, within the infrastructure asset class, because the infrastructure asset class itself has certain characteristics that are true for everyone in this space. Yield, total return, inflation protection, long duration cash flows, sustainability goals if those are issues.

So you kinda got these macro factors that are helpful to the infrastructure tailwinds and then the idiosyncratic experience of GCM Grovenor that’s really worked out well. In private credit, I think there’s, we only have a few minutes left, you could have another hour conversation on private credit. I guess I would say very succinctly that the thing that makes us interesting in private credit is we have the ability to help you in a very diversified, cost effective way, access everything in the private credit market that is not sponsored large cap direct lending. We can help with that too, but not a lot of people need a lot of help with that. There’s plenty of that to go around.

There’s plenty of access on that. It can be a great investment product. I’m not knocking it. I’m just saying the private credit world is a very big world, and our solutions have the ability to really help people fill other parts of that allocation, which I think is a really interesting place to be.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: Also, I want to get your view on secondaries. That’s increasingly attractive now given limited distributions, exits, you name it. How would you characterize activity right now? What sort of discounts are you seeing in the market today?

John Levin, President, GCM Grosvenor: I think it totally depends on the asset class and totally depends on kind of meaning and market cap size. You see bigger discounts at the small end, which is where we participate. I’ve personally never been a huge believer that the thing to look at in the secondary market is necessarily discounts all the time. I think that the secondary market is a market that is still poised for across all the asset classes a tremendous amount of growth. I don’t think in the history of capital markets you’ve ever seen evolution where the secondary market actually doesn’t ultimately dwarf the size of the primary market.

We’re still at a fraction of the size of the primary market. So I think there’s just tons of growth that we’re still going to see there. I think what it really comes down to when it comes to kind of evaluating what you want to do in the secondary space is looking at people who have the relationship advantage and the information advantage, which is legal in the secondary market, to capture the arbitrage that exists because it’s a more illiquid market. And so for us, for example, where we focus in the small and mid cap space, whether you’re talking about infrastructure or private equity or private credit, all where we have active secondary capabilities, the ability to trade in a business where you can have relationship advantage or invest, maybe is a better word, where you can have relationship advantage and information advantage, think is a really attractive place for clients to drive value, for us to drive value for our clients.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: Great. Maybe last one here as we wrap up. On your long term goals, I think you’ve got a target out there to double FRE in five years. Maybe you can just remind us of the trajectory to get there and how we’re pacing as we sit here today.

John Levin, President, GCM Grosvenor: Yeah. So we’re on pace to meet that goal because I think it started coming out of 2023. I think that the confidence that we have in achieving that goal comes honestly mostly from the fact that we don’t know exactly the math that will get you there, but we know we have so many ways to win. And anyone that sits here and says they know exactly what their FRR or their FRE and their ANI is going be in 2028, I would discount that heavily because we don’t know. What we know is that we’ve got a business that’s growing its FRR, that the mix shift to private markets and directs oriented is a very positive mix shift, that we have operating leverage in the business, And that when you look at the addressable market for FRR growth, and you look at your existing clients re upping with you larger, you look at your specialized successor funds being larger than their predecessor, You look at the ability to acquire new clients, which we’re fortunate to do every day and every year.

You look at your ability to talk about new markets like the individual investor. There’s just a lot of different ways to win inside of that FRR equation with the operating leverage. It gives us the confidence, obviously, on the FRE side. And that’s obviously before you get into what you didn’t ask about, just the huge amount of earnings power that comes from the incentive fees where it’s very hard to predict exactly what year those will come in. But they have always come in and they will come in.

Stephanie Ma, Member of the brokers, asset managers and exchanges team, Morgan Stanley Research: That’s great. I want leave it there. Thank you, John, for joining us Thank

John Levin, President, GCM Grosvenor: so much for having me.

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