GCM Grosvenor Announces Launch of Sponsor Solutions Effort Focused on Seeding Small, Emerging, and Diverse Private Equity Firms; CalPERS Commits $500 Million to the Strategy

Rhea-AI Summary

GCM Grosvenor (Nasdaq: GCMG) has launched the GCM Grosvenor Elevate strategy aimed at making seed investments in small, emerging, and diverse private equity firm founders. With a partnership commitment of $500 million from CalPERS, the Elevate strategy focuses on reducing entry barriers for investor entrepreneurs and providing essential support resources. GCM Grosvenor manages approximately $17.5 billion with small managers and $13.6 billion with diverse managers. The strategy aims to capture attractive returns by investing in historically high-performing diverse managers, as highlighted by a recent NAIC study.

Positive

• Launch of GCM Grosvenor Elevate strategy focusing on seed investments in diverse private equity firms.
• Partnership with CalPERS includes a $500 million commitment.
• Potential for attractive risk-adjusted returns, supported by historical data showing diverse managers outperforming traditional benchmarks.

Negative

• None.

CHICAGO, Jan. 10, 2023 (GLOBE NEWSWIRE) -- GCM Grosvenor (Nasdaq: GCMG), a leading global alternative asset management solutions provider, today announced the launch of the GCM Grosvenor Elevate strategy (“Elevate”). The Elevate strategy is focused on making catalytic seed investments in small, emerging, and diverse private equity firm founders to help build and scale their investment firms.

The strategy will build on GCM Grosvenor’s strong, multi-decade track record of investing in small, emerging, and diverse managers and the firm’s position as a leading private equity investor in the small- and middle-market. The firm has approximately $17.5 billion of assets under management with small and emerging managers and approximately $13.6 billion of assets under management with diverse managers.

The Elevate strategy is being launched in partnership with the California Public Employees Retirement System (“CalPERS”), who have announced a $500 million commitment. GCM Grosvenor plans to raise incremental capital for the strategy, which will serve as a core component of a broader ecosystem being created in partnership with CalPERS that will be focused on lowering barriers to entry for investor entrepreneurs as well as equipping firm founders with the non-investment infrastructure support resources required for success.

“We are thrilled to expand our long-standing CalPERS relationship to launch the GCM Grosvenor Elevate strategy,” said Michael Sacks, Chairman and CEO of GCM Grosvenor. “By providing access to scale capital, support for non-investment infrastructure needs, and an opportunity to harness the networks and experience required to invest appropriately in emerging firms, we hope to generate attractive returns and catalyze meaningful opportunities for the next generation of small, emerging, and diverse firm founders in our industry.”

“CalPERS is committed to giving access and opportunity to new and innovative talent in the investment industry,” said CalPERS Chief Investment Officer Nicole Musicco. “By leveraging GCM Grosvenor’s network, investment platform, and experience investing with small, emerging, and diverse managers, we believe that together we will make an even greater impact.”

The Elevate strategy will seek to identify and partner with experienced private equity investors through seed investments to build and grow their firms. In so doing, it will seek to capture the attractive relative performance that diverse investment managers have demonstrated historically. In a recent study by the National Association of Investment Companies (“NAIC”), the NAIC Private Equity Index of diverse managers produced higher net multiples of invested capital (“MOICs”) than the Burgiss Median Quartile in 83.3% of the vintage years studied from 1998-2020.

“Our experience suggests this area of the market offers the potential for more attractive risk-adjusted returns, yet continues to be undercapitalized by sophisticated investors,” said Elizabeth Browne, Managing Director at GCM Grosvenor and Co-Head of the Elevate strategy. “The Elevate strategy is a compelling opportunity to support diverse, experienced investors as they build new firms and to build upon GCM Grosvenor’s robust track record of partnering with exceptional firm founders early in their lifecycles.”

About GCM Grosvenor
GCM Grosvenor (Nasdaq: GCMG) is a global alternative asset management solutions provider with approximately $73 billion in assets under management across private equity, infrastructure, real estate, credit, and absolute return investment strategies. The firm has specialized in alternatives for more than 50 years and is dedicated to delivering value for clients by leveraging its cross-asset class and flexible investment platform. GCM Grosvenor’s experienced team of approximately 530 professionals serves a global client base of institutional and high net worth investors. The firm is headquartered in Chicago, with offices in New York, Toronto, London, Frankfurt, Tokyo, Hong Kong, and Seoul. For more information, visit www.gcmgrosvenor.com.

About CalPERS
For more than eight decades, CalPERS has built retirement and health security for state, school, and public agency members who invest their lifework in public service. The pension fund serves more than 2 million members in the CalPERS retirement system and administers benefits for more than 1.5 million members and their families in its health program, making CalPERS the largest defined-benefit public pension in the U.S. CalPERS' total fund market value currently stands at approximately $443 billion. For more information, visit www.calpers.ca.gov.

GCM Grosvenor Media Contact
Tom Johnson and Will Braun
H/Advisors Abernathy
tom.johnson@h-advisors.global / will.braun@h-advisors.global
212-371-5999

CalPERS Media Contact
Communications & Stakeholder Relations
Contact: Nicole Ortega, Information Officer
newsroom@calpers.ca.gov
(916) 795-3991

FAQ

What is the GCM Grosvenor Elevate strategy?

The GCM Grosvenor Elevate strategy is designed to make catalytic seed investments in small, emerging, and diverse private equity firm founders.

How much has CalPERS committed to the Elevate strategy?

CalPERS has committed $500 million to the GCM Grosvenor Elevate strategy.

What is the goal of the Elevate strategy?

The goal of the Elevate strategy is to lower barriers to entry for investor entrepreneurs and provide necessary support resources for firm founders.

What are the assets under management for GCM Grosvenor?

GCM Grosvenor manages approximately $73 billion in assets across various investment strategies.

How do diverse managers perform in private equity according to recent studies?

A recent study by the NAIC shows that diverse managers produced higher net multiples of invested capital than traditional benchmarks in 83.3% of vintage years studied.