Managing Partner’s Update 2023

Every year we have to navigate a different set of challenges and 2022 was no exception.

Against the backdrop of turbulent markets, a return to the office and – more recently – high inflation rates, we have been fortunate enough to continue to grow organically, whilst maintaining stability within the firm. We began working with a number of great new clients during 2022 and, despite the economic uncertainty, our partner-led business model has continued to give us the proximity to clients to allow us to problem solve when required.

The group has grown from 580 to 700 people over the past 12 months, and at the end of the year we were delighted to welcome four colleagues to the partnership, alongside 131 promotions globally. Total assets under administration now sit at almost $180bn, across over 500 funds.

A number of our clients launched successor funds in 2022 and we continued to see greater complexity in investment structures. In addition, the theme of co-investment, parallel funds and secondary sales has continued throughout the year, while our Luxembourg administration, depositary and host AIFM offering is becoming increasingly attractive to North American GPs looking to capture greater European capital, particularly in the second half of the year as we saw US LPs reach their commitment caps by the summer.

We recently launched our new website to give clients better access to our thought leadership, as well as to better reflect our business. Our computable data strategy in Asia and now in London continues to evolve with a number of new clients using the strategy to obtain bespoke performance and side letter reporting. We continue to develop our own ESG strategy, and we are also helping a number of managers with their own proposition, both from a regulatory and operational perspective.

The next few months look uncertain with valuations not reflecting higher interest rates and fundraising may be slower for the next six months. However, it is reasonable to assume that business should pick up by the summer and indeed I can report back from a trip to Asia last week that our clients are detecting very positive signs of the Chinese economy opening up post-Covid.

Banks are well capitalised and, putting aside any potential geopolitical shocks, the gradual recovery from Covid-19, falling inflation and stabilising labour markets should allow a sense of normality to return in the second half of the year. As public markets recover, LPs will find themselves under allocated to private funds and no doubt we will hear less about the denominator effect. We expect to see credit funds continue to raise capital quickly to plug the gap in funding left by some traditional lenders and, of course, funds with a specific sustainability or impact strategy will continue to prove popular. We are already working with a number of leading GPs in this space and are excited to continue to grow this part of our business.

In summary, I remain thankful that, despite the numerous headwinds, we have been able to continue to grow our business. I would like to thank our clients, colleagues and advisors for your continued loyalty and support, and I am excited to see what 2023 will bring.

Best wishes,
Rob Short