Hamilton Lane Incorporated (HLNE) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, and welcome to the Hamilton Lane Fiscal Second Quarter 2027 Earnings Call. [Operator Instructions] This call is being recorded on Tuesday, November 3, 2026. I would now like to turn the conference over to John Oh, Head of Shareholder Relations. Please go ahead.

Thank you, Lina. Good morning, and welcome to the Hamilton Lane Q2 Fiscal Year 2027 Earnings Call. Today, I am joined by Hartley Rogers, Co-Chief Executive Officer and Chairman of the Board; Erik Hirsch, Executive Co-Chairman and Jeff Armbrister, Chief Financial Officer. Earlier this morning, we issued a press release and a slide presentation, which are available on our website. Before we discuss the quarter's results, we want to remind you that we will be making forward-looking statements. Forward-looking statements discuss our current expectations and projections relating to our financial position results of operations, plans, objectives, future performance and business. These forward-looking statements do not guarantee future events or performance and are subject to risks and uncertainties that may cause our actual results to differ materially from those projected. For a discussion of these risks, please review the cautionary statements and risk factors included in the Hamilton Lane fiscal 2026 10-K and subsequent reports we file with the SEC. These forward-looking statements are made only as of today, and except as required, we undertake no obligation to update or revise any of them. We will also be referring to non-GAAP measures that we view as important in assessing the performance of our business. Reconciliation of those non-GAAP measures to GAAP can be found in the earnings presentation materials made available on the Shareholders section of the Hamilton Lane website. Our detailed financial results will be made available when our 10-Q is filed. Please note that nothing on this call represents an offer to sell or a solicitation of an offer to purchase interest in any of Hamilton Lane's products. Let's begin with the highlights, and I'll start with our total asset footprint. At quarter end, our total asset footprint stood at approximately $1.1 trillion and represents a 7% increase to our footprint year-over-year, AUM stood at $151 billion and grew $5 billion or 4% compared to the prior year period. AUA came in at $929 billion and grew $69 billion or 8% relative to the prior year period. This stemmed primarily from market value growth and the addition of a variety of technology solutions and back-office mandates. Year-to-date through the second quarter of fiscal year 2027, total management and advisory fees were $325 million and were up 18% year-over-year. Total year-to-date fee-related revenue was $414 million and represents 29% growth year-over-year. Year-to-date, fee-related earnings were $215 million and represents 34% growth year-over-year. We generated fiscal year-to-date GAAP EPS of $3.80 based on $158 million of GAAP net income and non-GAAP EPS of $3.91 and based on $211 million of adjusted net income. We have also declared a dividend of $0.60 per share this quarter, which keeps us on track for the 11% increase over last fiscal year equating to the targeted $2.40 per share for fiscal year 2027. And with that, I'll now turn the call over to Hart.

Thank you, John, and good morning, everyone. Before Erik turns to the quarter's results, let me address a few leadership developments here at Hamilton Lane. These changes are very much evolutionary in nature and reflect what remains our focus, delivering outstanding results for our clients, our shareholders and our employees. Juan, Erik and I, together with our Board and our broader leadership team are aligned and focused on exactly that. These changes put each of us in the optimal place today to add value. Before I say more about that, let me pause here and recognize the person who has been such a core part of this firm for so long, Mario Giannini. A few weeks ago, we announced that Mario will retire from the firm effective March 31 of next year. Mario joined Hamilton Lane shortly after its founding and immediately became the driving force of the business. Over more than 3 decades, he has relentlessly advocated for our clients been a sober voice and lover of data in a world too often driven by stories and anecdotes and for us, he has been a leader, a mentor and a trusted friend. He built a culture grounded in candor, directness and genuine care for each other, and that culture thrives and continues. We thank Mario for his endless contributions, and we wish him must joy in his retirement. Alongside Mario's news, as you've also seen, I've been named Co-Chief Executive Officer alongside Juan. At the same time, Erik has moved into the Executive Co-Chairman role where he'll lead strategic initiatives that drive our long-term growth. Let me start with Erik. Erik joined Hamilton Lane in the late 1990s when he was 26, over his more than 27 years with the firm, Erik has been asked to wear many hats and he has done so successfully. Today, we see rapid evolution coming in our industry and evolving market landscape, changing technology and expanding customer base, the advent of AI is a truly revolutionary force, Remaining a market leader means dedicating real focus to navigating these changes, investing our firm capital strategically and creating partnerships that unlock new opportunities. Recent announcements like our new partnership with Columbia Threadneedle or our ongoing strategic relationship with Nevada or our numerous balance sheet investments, many of which are focused on technology and data are examples of these initiatives and are all things which Erik has led. In his new role, he will focus on those strategic initiatives and continue to speak on behalf of the firm with the media -- he will continue to lead HLNE earnings calls alongside John and Jeff. He will also remain on the firm's Board of Directors. For me, I've been with Hamilton Lane since 2004 and the Chairman since 2005. Over those years, I've been closely involved in our investing and client relationship activities as well as in the firm's strategic and organizational development. I've spent more than 45 years in the private markets, and I am genuinely excited to take on this new challenge. Hamilton Lane has built a truly differentiated platform in scale and the breadth of our product lines in our geographic reach and our client base and in our highly aligned structure and philosophy. I have enormous conviction in our people, our culture and the trajectory we're on. Juan and I will now work side by side from Hong Kong and the U.S. to build on the foundation we've established with clients around the world. We are a market leader in the most exciting and rapidly growing of the asset management area of the asset management universe and we aim to capitalize on that position to drive continued success. As co-CEO, my focus has 3 parts: first and above all, keeping clients at the center of everything we do. that client-first approach is the foundation for everything else and nothing changes in how we serve them, the same teams, the same strategy and the same investment approach they've always counted on. Second, accelerating our growth. building on the strong trajectory this firm has sustained for years and finding ways to further that. And third, investing in and developing our incredible group of talented employees. We have amazing people and high potential people at every level, and part of my job is making sure we're positioning the next generation of leaders to bring this firm to its fullest potential over the coming years. With that, I'll turn it over to Erik.

Thank you, Hartley, and good morning, everyone. We ended the quarter with total fee earning AUM of $86 billion, an increase of $10 billion or 12% versus a year ago, and an increase of $2 billion or 3% from the end of the prior quarter. The mix of that growth continues to skew towards specialized funds, which carry higher fee rates. As a result, our blended fee rate moved up to 69 basis points and represents growth of 14 basis points or 5% compounded annually and our blended fee rate over the past 5 years. . Drilling deeper into specialized funds. Fee earning AUM here closed the quarter at over $44 billion having grown nearly $9 billion or 25% over the trailing 12 months and increased $2 billion or 4% in the quarter. We generated over $2 billion of gross contributions in the quarter, driven primarily by Evergreen subscriptions and the first close of our seventh secondary fund along with continued drawdown activity from funds that charge management fees on a net invested basis. This was partially offset by evergreen platform redemptions and returns of capital due to exit activity. Specialized funds have now entered a period where we expected to see meaningful growth relative to last fiscal year, given the number of products that are either currently fundraising or will be holding their first closes in the coming months. Let me touch on some of the drivers during the quarter. Our Evergreen platform finished the quarter at nearly $21 billion of AUM, representing 42% growth in AUM over the prior year. For the quarter, net inflows came in at nearly $800 million, an acceleration from the nearly $640 million we reported in the prior quarter and the momentum built through the period. September fundraising alone brought in nearly $400 million of net inflows. Also noteworthy, we still have had no gates on any of our products and performance since inception remains strong across the product set. Growth will not be perfectly linear. There will be quarters when flows accelerate and quarters when they slow, strategies that are in favor and strategies that are not and headlines that shape sentiment across the various categories. We don't manage this business to any single quarter's flow number. We manage it to whether we're building the right products with the right performance in front of the right investors. And as we have said before, this is a marathon, not a sprint, and we are running with purpose. Let me turn now to our closed-end platform. We continue to execute well across our fundraising activities. We are pleased that several of our flagship strategies are either already in market today, or are poised to return to market in the near term. And we remain genuinely excited about the newer strategies we expect to bring to investors in the periods ahead. Let me begin with our seventh secondary fund. As we discussed last quarter, we held the first close in July on nearly $1.3 billion of investor commitments. Management fees on that capital turned on at that first close, and that is reflected in this quarter's management fees. As a reminder, fees on subsequent closes are retroactive to the date of the first close, so the catch-up fees associated with future closes will be recognized when those closes occur. The fund is off to an encouraging start. We've already been able to deploy capital into interesting opportunities that fit squarely within our playbook, diversified relationship sourced deals where we believe our market position and existing knowledge give us an edge in underwriting, pricing and conviction. We look forward to providing additional updates as we continue to progress. Turning to venture. As we mentioned on our prior call, we held the first close for our latest venture fund last quarter on more than $370 million of commitments. For context, our first venture fund raised $615 million in total, which means this initial close already represents more than 60% of the size of the first fund, another strong proof point that our flagship venture platform continues to build real momentum in market. Management fees have already turned on for this latest closed. And just as a reminder, -- this product charges management fees on a committed capital basis and thus, every subsequent close will generate retro fees from here until the final close. Alongside these established flagships, we're also advancing a healthy pipeline of newer strategies that we're excited to bring to market in the coming quarters, which we touched on during our prior call. So we've launched our inaugural GP-led secondary fund. -- an important step in the continued growth of our secondaries platform. We view this new strategy as a natural complement to our core secondaries platform and a representation of the next phase of growth for our broader secondaries efforts. Building on the platform we have established, we believe GP-led secondaries allow us to address an increasingly significant segment of the market and to partner even more closely with GPs as a trusted capital provider. In credit, our newest credit strategy reflects the next step in reshaping our direct credit platform and is expected to pursue a strategy that spans both diversified lending provides financing across the capital structure of mid-market businesses to capture both credit downside protection and equity-like upside as well as specialty finance, which targets differentiated, less correlated opportunities such as credit secondaries and asset-backed and niche lending transactions. We're encouraged by the progress across both of these efforts. Beyond our larger flagship funds currently in market, we've also built a long track record of success with a number of smaller niche closed end platforms that round out our broader specialized fund offerings. Our third impact fund is a good example. It has now raised nearly $340 million of investor commitments continuing the growth we've seen across each successive vintage of that platform. We've seen similar success over the years scaling several white label and regionally specific vehicles and in aggregate, these smaller platforms have raised and contributed over $4 billion to our specialized fund business. While each may be modest in size on its own, together, they reflect our consistent ability to identify, launch and scale differentiated products well beyond our flagship offerings. They also show what it means to be a true solutions provider. Having the investment ability to aid clients across all facets of their private market needs. Taken together, we view this as 1 of the more active and encouraging stretches for our closed-end platform. Several of our flagship products are either already in market or will be shortly with a healthy slate of newer launches sitting right behind them. That's been the playbook since our IPO, grow and scale the existing lineup and tactically layer in new products where we already have the team, the deal flow and the relationships to execute and to do that well. The work continues, and we certainly are not done. Real estate, expanded credit, additional secondary offerings and equity co-investment offerings are all areas where we expect to keep building. Let me move now to customized separate accounts. At quarter end, customized separate account fee-earning AUM stood at $41 billion and grew $663 million or 2% over the last 12 months. and was up $362 million quarter-over-quarter. Gross contributions came from a mix of new client wins plus re-up activity from existing clients plus contributions for investment activity and then being offset by fee basis step-downs, which is largely a timing-related impact as well as capital distributions stemming from exit activity. We also added to our separate account dry powder as we executed and closed on $1.7 billion of new total contracted mandate value -- this stems primarily from our existing clients in the form of both re-ups and the expansion of service lines with existing relationships. Our pipeline of mandates still yet to close also remains healthy. measured in the multiple of billions in total future contracted mandate value. As we have said before, these mandates do not always convert immediately into fee-earning AUM and particularly where the underlying portfolio construction is more heavily oriented towards primary investing or where there are commitments being made to our transaction products either drawdown or evergreen. There is often a natural pacing element to deployment for the primary element, and that timing should be expected. But what matters most to us is that the capital has been awarded, client relationships have been established and the foundation for future fee earning growth is in place. Again, the total mandate value may not all end up being captured in the customized separate account line. And let me take a step back here because I think it is worth emphasizing the why and not just the what. Our clients understand that optimal portfolio construction requires a mix of strategies not simply investing in primary funds. You can see that directly in our flows, whereby meaningful SMA capital immediately migrates over to specialized funds. And it is not just the mandates already on our books. It is showing up in the newer mandates and processes we are working through right now. When a client or prospect comes to us to build their private market program, they are explicitly asking us to blend primaries with secondaries and co-investment access from day 1. That tells you where the client mindset has shifted. And it tells you that this is not a one-off trend. It is becoming the default expectation, which brings me back to something I mentioned earlier on this call, we are expanding our specialized fund lineup, and that expansion is not a side project that runs parallel to our separate account business, it is directly additive to it. Every time we add a vehicle, a secondaries fund, a venture strategy or infrastructure fund, our separate account clients benefit from that same growth because we are able to dial their customized portfolios into the same access points the same deal flow and the same general partner relations that power our comingled products. That is the flywheel. Our specialized funds get stronger and our separate account clients right alongside that strength inside portfolios built specifically for them. Turning now to the technology and data side. Yesterday, we announced a new strategic partnership with FactSet a leading global financial data, analytics and AI solutions provider. The relationship is set to deliver an integrated private market analytics solution for institutional investors. Institutional investors have long managed public and private portfolios in isolation. On separate systems with separate tools. As allocators increasingly think about their portfolios as 1 unified hole, that gap becomes a constraint. Bridging it is key, and we and FactSet recognize that. Through this partnership, our institutional grade private markets data covering more than 70,000 funds 240,000 private companies and our proprietary fund and deal level benchmarks become natively accessible within FactSet's portfolio analytics platform that is designed to give limited partners institutions, financial advisers and researchers the ability to evaluate performance, identify trends and build portfolios with real transparency across strategies, vintage years and geographies. The integrated solution breaks down into 3 pieces. First, proprietary benchmarking our indices built on decades of high-quality private market data become natively accessible inside FactSet's performance measurement environment, giving clients a differentiated transparent alternative to public indexes proxies along with the ability to build and apply custom benchmarks directly into their existing workflows. Second, enhanced risk and commitment pacing models -- we're embedding our data directly into FactSet's analytics infrastructure, giving allocators better inputs and better engines to act with conviction across their entire portfolio. Third, whole portfolio construction and monitoring. Clients can track public and private exposures in 1 place with performance, attribution and risk analytics that span asset classes. There's a commercial arrangement attached to this as well. We have secured multiyear annual recurring revenues with an agreed-upon floor that is structured to scale with the success of the partnership and reflective of the strategic importance of both the data we are providing and FactSet's ability to deliver best-in-class public private analytics solutions. The revenue will show up in our reporting, monitoring and data analytics segment of our management advisory fees going forward. And with that, I'll now pass the call to Jeff.

Thank you, Erik, and good morning, everyone. For this first half of fiscal 2027, we continue to generate solid growth in our business. Management and advisory fees were up 18% from the prior year period while total fee-related revenue was up 29%, driven by strong growth in our fee-related performance revenues. Specialized fund management fees increased by $46 million or 27% compared to the prior year period. This was driven primarily by a $6 billion increase in fee earning AUM in our Evergreen platform, an approximately $1 billion increase from our latest direct equity fund over the last 12 months and the first close of our latest secondary fund. . Moving on to customized separate accounts. Revenue decreased slightly compared with the prior year period. This was due to onetime true-ups for separate accounts committing to specialized fund products. Revenue from our reporting, monitoring, data and analytics offerings increased by nearly $3 million or 15% compared to the prior year period as we continue to produce strong growth in our technology solutions offering. Lastly, the final component of our revenue is incentive fees, which totaled $154 million for the period. This amount includes fee-related performance revenues stemming from the quarterly crystallization of performance fees from certain of our evergreen funds. Let's turn now to our unrealized carry balance. The balance is up 11% from the prior year period even while having recognized $107 million of incentive fees, excluding fee-related performance revenues during the last 12 months. The unrealized carry balance now stands at approximately $1.6 billion. Moving on to expenses. Fiscal year-to-date, total expenses increased $57 million or 27% compared with the prior year period. Total compensation and benefits increased $39 million or 26% due primarily to increases in operating performance headcount. G&A increased by $18 million, primarily driven by revenue-related expenses, consolidated funds, technology expenses and onetime benefits in the prior year period. Revenue related expenses include the third-party commissions related to our U.S. evergreen funds, along with other evergreen fund platform fees, closed-end fund placement agent fees and fund reimbursement expenses, which are expected to lead to corresponding revenue over time. The increase in these expenses is a good thing and can be an indicator of growth to come. We continue to successfully offset this with cost savings and expense discipline in other parts of the business where we have discretion. Moving to FRE. Fiscal year-to-date FRE came in at $250 million and was up 34% relative to the prior year period, while FRE margin year-to-date came in at 52% compared to 50% for the prior year period. both FRE and FRE margin benefited from strong year-to-date fee-related performance revenues. Let me turn to the balance sheet. The largest piece of it remains our GP commitments alongside clients and our customized separate accounts and specialized funds. We don't think of these commitments as simply a line item. We view them as a genuine long-term growth driver, and we intend to keep deploying our own capital alongside our clients' capital. When this part of the balance sheet grows, it indicates something important. We're growing with our existing clients, winning new ones, raising larger and more numerous vehicles and making sound investment decisions along the way. We see that growth as a clear signal that the business is flourishing and we expect it to remain that way. Another important part of our balance sheet investments are the commitments we have made to technology and strategic partnerships. Last quarter, we mentioned events on 3 investments. securitize, Canoe and Russell, and I wanted to provide an update on each of these. First, on securitized -- the business combination closed in the reporting period, which resulted in a $15.6 million gain included in the nonoperating gain net line of our income statement. We now hold approximately 1.5 million shares of securitized, which trades under the ticker SECZ, and will be marked to the publicly traded share price at the end of each quarter going forward. Our shares remain subject to a 180-day lockup period, after which we will continue to evaluate the position. With respect to Canoe, their acquisition by Bloomberg was closed in October, which resulted -- which will result in a $17 million gain in the third quarter of fiscal 2027. Lastly, the announced acquisition of Russell by a consortium led by Capital and CalPERS is expected to close in the first quarter of calendar year 2027, subject to regulatory approvals and other customary closing conditions. Assuming the transaction closes as expected, we would anticipate recording a gain of approximately $18 million at that time. Let me close with 1 further point on this. We expect to continue to use our balance sheet tactically to help products get off the ground and practice that has generally meant providing seed capital and for a period of time, consolidating those vehicles onto our balance sheet during the ramp-up and scaling phases. That consolidation can introduce some noise into our financials, but we view it as a short-term phenomenon. The objective is always to deconsolidate once initial stake is diluted down as the product scales and brings in outside capital. More importantly, I want to underscore the broader point. We have meaningful capacity on our balance sheet and the ability to deploy it tactically in support of continued growth. We believe this is an important part of how we run the business, and we will continue to evaluate these opportunities going forward. On the liability side, our leverage profile remains modest and consistent with where we have managed leverage historically. With that, thank you all for joining us, and we'll turn it over for Q&A.

Ladies and gentlemen, we will now begin the question-and-answer session. [Operator Instructions] And your first question comes from the line of Ken Worthington from JPMorgan.

Maybe first for Hartley, first, thanks to reconnect here. Can you talk about the continued build-out of distribution and wealth how the build-out is evolving for your larger funds like PAF and GPAF versus smaller funds like Venture and Infra. And what sorts of investments you're planning in sales and distribution and the targets that you're setting for you and your team? .

Ken, great to reconnect as well, and thank you for the question. We continue to be very focused on building out the wealth distribution channel, we have a number of products that are in the market now that are coming along. They are all sold effectively through the same channels. We have national account channels as well as more specific smaller RIA type channels, and they're centrally managed by the team that does that, both in the U.S. and around the world. So it's a 1 distribution team strategy, and it's an area that we are continuing to make significant investments in.

Maybe, Erik, for you, you mentioned that wealth sales accelerated in the quarter with $400 million in September. Can you talk about the drivers of the improvement throughout the quarter? Which funds are driving it? And why do you think you're seeing a rebound now?

Thanks, Ken. So one, the good news was we saw growth coming across a huge array of the product offering. So that diversity of product offering with us having 12 of them today, I think, continues to serve us well. I think the other part of this is not magic. I think the market has just been kind of rocked with a bunch of headlines and sort of bad news and fake news and gossiping and all of that, I think, has sort of hit a customer that is still very, very early in their sort of journey into the private markets. And I think you've seen them react negatively and as they kind of continue to mature as more data becomes available to them as they're making more fact-based decisions, I think you're starting to see their behavior alter as well. And I think that's just part of this journey. It's why we think partnerships with firms like FactSet, Bloomberg are really important for us because getting more data in the hands of the ultimate consumer we think helps that maturation process and makes people more informed about how they go about making decisions for their investment world. So I think time is really the answer to the question.

And your next question comes from the line of Alex Blostein from Goldman Sachs.

I wanted to follow up on a couple of things you guys mentioned related to the closed-end funds. I heard a number of new kind of adjacent strategies. I think you mentioned secondaries in credit. I think you said at ABF as well. So maybe help us frame kind of what do you expect it to be in the market with on the closed-end side for kind of first-time funds. And what is sort of your goals for fundraising for those first new vehicles?

Sure. Alex, it's Erik. I'll take that. So I think on the first-time side, what we talked about here was GP-led secondaries is new. That's just really -- we've obviously done a lot of that investment activity in our main flagship secondary fund. As that market segment continues to grow -- we see investor demand of having that as a stand-alone vehicle also growing. And so that's where we're heading. . On the credit side, while again, a new fund for us, this is really just an evolution in what we've been doing for years. And our prior credit vehicles and then, again, venture is just an expansion of we're already -- we have multiple products in that space, impact same -- so our goal here is to continue to widen out the product offering to meet investor demands and to continue to scale all of those over time. So -- and the track record of doing that has been strong, where -- you've got a long history here of subsequent funds all coming in at kind of bigger and higher levels than their predecessor funds. So that in a very simple way is the goal.

And then just 1 financial question for you guys. Obviously, FRE margin is very strong this quarter, north of 50%. Maybe talk a little bit about your expectations for FRE margins for either the rest of this fiscal year or if you want to frame the next 12 months, that will be helpful. .

Alex, this is Jeff. So we started off the gate in Q1, very strong with the FRE margins driven by strong FRPR didn't expect to have that continued level on predictable basis as you saw in Q2, the FRPR was a little bit down and how that flowed through the margins. But we're on a longer-term basis on an annual basis, we're expecting to really continue with the low 50s type of FRE margin. And so we think that the environment allows us to continue to operate and generate those types of margins.

And your next question comes from the line of Brennan Hawken from BMO Capital Markets.

You gave a little bit of color on this new announcement tied to FactSet. You have mentioned that it has a floor. So interesting to hear if you can give us some color around what level that might be and what your expectations would be for the scaling of this partnership as you move forward? .

Sure, Brennan, it's Erik. So we're not at liberty, given the partnership to kind of disclose full revenue numbers. What I can say is the floor is meaningful. And we think that the opportunity that sort of lies ahead makes that even more meaningful. This has had sort of top of the house attention at FactSet as it has had here. And so given the scale of their business and again, sort of this driver into the private side, we are very excited and energized about what we can do together by bringing these platforms together as I laid out. And so again, we're starting in a good strong place and we think there's good room to grow from here.

And then thinking about the secondary flagship 7, you guys had your first close, the predecessor fund, I believe, it was 5.6%. That was up $1.7 billion from number five, what's the -- how are your expectations for how big 7 can be? What's been the reception as far as fundraising goes for secondary vehicles in the current market environment? Could you give us maybe a mark-to-market around all that?

Sure. It's Erik, again, Brennan. I think, first of all, that market continues to be sort of the most undercapitalized relative to the opportunity set. Think investors recognize that. It's also been 1 of the market segments that's delivered some of the best risk-adjusted returns across the entirety of the asset class. So demand there is high. Our ability to grow, we think, is also significant. And if you look at where we sit today in the ecosystem, we're kind of a midsized player. There are firms that are managing funds that are multiples the size of ours. And so we think our deal flow, strength of team, franchise brand, all is allowing us to continue to scale and grow that business, and that is absolutely our intention.

And your next question comes from the line of Michael Cyprys from Morgan Stanley.

Maybe 1 for Hartley and great to reconnect here. You've been closely associated with Hamilton Lane for over 2 decades. As you step into the co-CEO position, just curious what your biggest priorities are for the firm over the next 3 to 5 years. What are some of the areas you think Hamilton Lane needs to invest more aggressively or maybe even evolve its approach? And what steps might you take to accelerate growth here? .

Mike, nice to reconnect as well, and thank you for the question. I mean I think -- the main thing is to continue doing what we are doing well now. And so that means really continuing to develop the client centricity of the business. Our clients range from small investors in the wealth channel all the way up to sovereign wealth funds and giant pension funds, and they all have their own particular mix of needs and interests. Hamilton Lane has been very good over the years at being able to match the needs and interest with what we're able to bring to them to be very client-centric and very responsive. We are going to absolutely continue to do that. Our belief is that in the private markets today, that kind of client centricity is a unique thing that we have. It's -- our business is a very aligned business. We're all kind of a 1 team culture, very much focused on bringing the best of ourselves to our clients, and we are absolutely committed to continuing that. We also have a number of growth initiatives. Erik touched on a lot of them. Those are -- we believe in all of those. We think they're all going to be important. We continue to focus on being a global firm and make sure that we're bringing to clients around the world, the best of what we can do and also bringing to investors around the world, the best investment opportunities that we can find globally. And then finally, a big focus on maintaining culture and developing the next generation. We think we have a lot of very talented people in the company, and we want to make sure that we're giving them the opportunity to grow and develop and broaden so that the firm will be able to benefit from their leadership potential in the coming years.