ICG plc (ICG) Earnings Call Transcript & Summary

Good afternoon, and thank you all for us at the seminar today on fundraising and client strategy. This is, of course, a topic that is fundamental to ICG's prospects, and I'm looking forward to having an interesting discussion over the next 60 minutes or so. Importantly, we're focusing today on this topic through a strategic lens and very much in the long term. The slides are available on our website, and a recording of this presentation will be available on the website in the coming days. We're hoping for an interactive discussion today. We'll make sure we leave lots of time for Q&A. For those of you joining online, you can submit questions through the webcast messaging function or by telephone, and you can find details in the online portal. I am delighted to welcome to senior colleagues today, who will be speaking, Andreas Mondovits, who has been with the firm for over a decade and who heads up the firm's Global Marketing and Client Relations team of roughly 70 people globally. And Bashak Demir, who joined last year to head up our client relations function globally. We will be covering a range of topics today. Firstly, some observations on the macro backdrop, then some color on ICG's client base, its history and where it is today, how this has been supporting our strategy of growing up and growing out; and finally, spending some time looking ahead. What I hope is that at the end of this session, you'll have a better appreciation of ICG's approach to client development and fundraising and our strategic areas of focus historically and importantly, going forward as they relate to this area. And there are 5 key messages we want to leave you with today. Since we really made the decision to pivot towards being a third-party asset manager, we have successfully built a global blue-chip client base. The focus over the last decade has been on increasing the number of clients on our platform, and we have executed on that across all geographies and with a particular focus on institutional investors who are the largest, most sophisticated and most concentrated pool of capital within private markets. Along with investing well, our clients are, of course, a crucial component in growing up and growing out. And our client franchise today gives us a lot of confidence that we can continue to do this in the future. Building on our progress over the last decade, ICG is increasingly well positioned to capitalize on the demand for alternatives across multiple asset classes. And we have spent a lot of time historically broadening our product offering. As you look at the pipeline of strategies today that have not yet even had a final close on a first-time fund, there is a lot of opportunity here. And the focus in the coming years is very much bringing them to market and scaling them. And as we continue to become bigger and broader, we are becoming ever more relevant to ever more clients, and we see real tangible benefits both of our franchise and of our scale. So looking ahead, we believe we have substantial runway to grow our existing client base and to increase the share of wallet in our existing clients. So in all, we think some pretty long term and powerful supporters of our equity story. At this point, I'll pass over to Andreas to share some observations on the macro environment in which our clients are operating.

Thank you, Chris, and thank you all for joining today. It's been a few years since I've been on stage last, I think, 2018, if I recall correctly. And while many of the messages are similar, our scale is notably different. Compared to 2018, we have almost 2x as many clients now and 3x as much AUM across a broader range of scale strategies. So from my perspective, we're in our business that is increasingly able to focus on serving the world's largest investors across multiple asset classes. That is incredibly exciting and positions us well to benefit from a number of macro trends we're observing. I want to start by looking at the AUM growth in the product markets over the last 10 years. The growth has been remarkable over 3.5x in the last decade and now standing at almost $12 trillion, which is around 10% of global AUM that is professionally managed. That tailwind has obviously been a huge structural support to our growth, but it's worth noting that we have grown our AUM nearly 6x during the same period, meaning we have significantly outperformed growing market. The focus of this seminar's clients among that perspective, we have observed a number of trends. As Chris said, I joined ICG a decade ago. So I've seen a few of these from within the firm. For example, alternatives are no longer alternative. There's not an investor globally who is not allocating or at least considering allocating to the alternative asset class. And within private markets, asset classes are at different stages of maturity. Many investors first taste of private markets was private equity and globally, that remains the largest component. Private debt, infrastructure and private real estate, for example, are younger with smaller AUM in the private markets. But to my mind, there's no structural reason why over the coming decades, they should not converge or at least the gap be closed. So what explains this increasing continued demand for private markets? Has it been all been a search for yield in a low-rate environment? From a structural long-term perspective, I can confidently say, no, it's not. Clearly, yield pickup in a low-rate environment can be 1 driver. And our ability to offer clients exposure to floating rate and direct lending is a good example as the strategy is currently generating some unprecedented returns. However, there are a number of other reasons in my view that go beyond this and are far more strategic. Attributes such as high returns, partly a function of illiquidity or complexity premium and access to asset classes with inflation-linked protection, along with lower volatility are key attractions to private market strategies and differentiators versus the public market. As is the ability to match long-term liabilities with long-term assets, for certain types of clients, for example, insurance companies, this duration matching can be a driver. Beyond this, if you are a midsized business services, education or health care business in the Western world today, you probably have no need to ever raise public capital in the debt or equity markets. You may choose to do so for a variety of reasons, but you do not need to as the private markets are sufficiently scaled and mature that can grow and monetize the business exclusively within private markets. As a client, therefore, investing in private markets gives exposure to many parts of the economy that are increasingly difficult to access in the public markets. For example, high-growth companies, particularly in Europe, business, technology and health care services and, of course, infrastructure. In all, the reasons for clients investing in private markets are, of course, multifaceted and vary between client types, but they're based on long-term and strategic approaches, which are not really driven by a short-term tactical response to prevailing conditions in any particular moment in time. Finally, given the illiquidity and private nature of our business, dispersion in performance between manager and the pride arena is huge. So manager selection really matters, and Bashak will show you later how our clients view ICG's performance. On the previous slide, I mentioned that many companies they are and can be very well capitalized without ever needing to raise public capital. This creates a self-reinforcing ecosystem within private markets that is quite powerful, driven both by the client demand and investment opportunity. In particular, over the last decade, but beforehand as well, we have seen a substantial increase in the amount of AUM focused on private markets. This has enabled more companies to stay private for longer, and they may decide to do this for many reasons. Flexibility of capital, ability to focus on long term with fewer quarterly distractions, the regulatory burden of a public listing and so on. In doing this, companies create a larger addressable market of investment opportunity for private AUM. So it is more money chasing investments. Because both sides of the equation are growing, private markets have been able to continue to generate attractive returns at increasing scale. Those returns, along with the other dynamics I discussed on the previous slide, meaning that there is an increasing demand for private markets, which helps drive that same cycle. In many ways, this is a function of private markets maturing, but we are not fully there yet. And I see the self-reinforcing cycle is becoming a powerful driver for many years to come. Of course, whilst we're talking today about the long term, we cannot ignore the current environment. Whilst we see structural appetite for our terms remaining strong, in some areas, things are slower across the industry than they may have been 18 months ago. But that is timing and it's also not the case across the board. For some clients and client types, we have seen very little change in their investment programs and behavior. For example, Middle Eastern clients and sovereign wealth funds, in particular, along with certain insurance companies who are not as impacted by the denominator effect. For certain clients, of course, particularly pension funds, the so-called denominator effect is important and has caused a slowdown in the ability to commit capital profit markets. We expect this to be a temporary situation. Indeed, some investors are increasing their allocation to alternatives, which will help alleviate this. For example, at the end of 2022, New York City pensions, which in aggregate manage roughly $450 billion of assets, increase the allocation to alternates from 25% to 35%. This adds approximately $45 billion of additional firepower going to alternatives, and we expect this to be a long-term allocation. And as we speak today, there are a lot of our largest pension funds going through a similar approval process, underlying their structural interest in private markets allocations. So despite the current volatility and market uncertainty and perhaps in part because of it, we continue to see clients allocate capital to private markets. Provided managers are able to continue to deliver even in turbulent times, this will further reinforce the rationale for clients having a meaningful allocation to this asset class. Alongside successful investment strategies are key to us being able to capitalize on these opportunities route to market. Over the last decade, we have grown a global sales and marketing platform from scratch. As you can see on this slide, we have 40 marketers and locations across EMEA, the Americas and Asia Pacific. Over the last 18 months, we have been hiring into areas where we see specific growth opportunities, and where geographic client or strategy knowledge are particularly powerful. At this point, I'll pass to Bashak to share some thoughts on our client base and how it's fit into our historical AUM graph.

Thank you, Andreas, and thank you to everyone for joining today. As Chris mentioned, I joined ICG last year. And since this time, I've continued to be impressed by the scale of our client franchise and really the depth of our relationships with some of the largest allocators in the world. So what I would like to discuss with you today is how our client base has grown over the last decade and what it looks like today before going into more detail on what this has translated to fundraising-wise. So as you can see from the chart on the left-hand side of the page, over the last decade, we've grown the number of clients 9-fold, which is really quite extraordinary from just 69 clients in 2012 to well over 600 today. This equates to an annualized growth rate of 23%, and it's very much consistent with Andreas' comments earlier around ICG having a deliberate strategic focus on growing the number of institutional clients on our platform. So just digging into this growth a little bit more, what you can see is that it's been very global with a particular focus on U.S. clients. In fact, since 2012, the number of North American clients has grown over 11x and stands at approximately 160 today and includes 6 of the top 10 allocators in the region. This growth in client numbers has also had the added benefit of reducing client concentration, and you can see this here. Our single largest client in 2012 accounted for 16% of third-party AUM. Today, this number is around 3%, to give you an idea. Our AUM also benefits from being incredibly diversified. And this diversification includes geographically by investor type and by mandate. I just want to reflect on this point for a moment because I think it's particularly powerful from a shareholder perspective, both in terms of reducing single client or geographic exposures or risks, but really for underlining the board-based appeal of our products. But it's all very well and good me telling you how great ICG is. I suspect what you'll find more interesting is what our clients say about us. For background, we commissioned Coalition Greenwich with whom I'm sure many of you will be familiar to do a global client survey for us in 2022. And as part of the survey, they went out and conducted in-depth interviews with 200 consultants and clients and prospects. And what you see here on this page is some of the direct forbidden quotes from investors on how they describe ICG and what they perceive to be our strength. And really, the key themes to come out of this are consistent with the messages we've been communicating to equity markets for some time. To summarize, they see us as innovative, diversified, strong track record and of meaningful scale. We also had Greenwich asked how our clients perceive us across a range of factors, including investment experience and client service specifically. Before we just delve into this, just a quick note on how to read the chart. So the dark gray bars denote the third quartile of each measure with anything below by definition being fourth quartile and then the blue bars denote second quartile, again, anything above being first or top quartile. And finally, the very, very small dots, which are incredibly difficult to read, are ICG's rankings, which, as you can see, are all top quartile and, in some cases, top decile. So clients perceive us to be a top-quartile investor with top quartile client service. For me, being responsible for our client service efforts globally, these last 2 slides here are incredibly powerful validation of how our clients see ICG. And this is clearly a large part of what has allowed us to grow our client base at both the scale and pace that we have over the last decade. It also gives us confidence that we can continue to grow our AUM, both with new and also existing clients. I want to shift gears now, if I may, from the growth in our client numbers and turn to how this growth has driven AUM. So again, you'll see that over the last decade, we have raised roughly $100 billion in aggregate from our clients. And this has really been the result of increasing the size of existing strategies, so growing up and by launching new strategies, growing out. And I'll talk through a couple of interesting dynamics relating to each of these points. Firstly, growing up. And here, we look at average commitment sizes. As you would expect, as our more mature strategies grow, so too do the average ticket sizes. And what we show here is the data for both our flagship European corporate strategy and also our market-leading GP-led strategic equity strategy. And these are just 2 examples of this dynamic in play. What you see is that as we grow, our clients are able to grow with us. Additionally, as our funds get bigger, we're able to absorb larger individual commitments. As some of you may recall, in Europe VIII, we had a brand-new client to ICG, commit EUR 500 million. We wouldn't have been able to absorb that size of commitment in Fund VII, let alone Fund V. Now, of course, for any fund and fundraising, existing clients within the strategy are really the bedrock on which you build success. And on this page here, we show the value of so-called re-ups for the same 2 strategies. As you'll see, in Europe V, we had a total fund size of EUR 2.5 billion, EUR 600 million was committed by clients who are in the previous vintage, so Europe IV. Fast forward to Europe VIII, which held a final close last year at EUR 8.1 billion. EUR 3.9 billion was committed from investors who were in Europe VII, and we see the same trajectory for strategic equity. So the takeaway here is clients who have invested in a strategy with us typically like what they see and then they invest in the subsequent vintage, often with larger ticket sizes. And what this enables is for us to deliver increasing AUM from existing clients as our strategy scale. Again, this dynamic is very consistent with our clients' perceptions of ICG. Now growing out. So the launching of new strategies has a slightly different dynamic. So obviously, with the new strategy, you don't have an existing track record. So what you need to rely on is the appeal of potential returns along with ICG's franchise and platform to really give investors comfort that we can deliver for them. And we saw this come through very powerfully with the first vintage of our European infrastructure fund, which held a final close last year. As many of you will know, infrastructure is a very well-established asset class globally. And many clients and investors have dedicated teams and pools of capital focused on making infrastructure fund investments. Now despite this, we were still able to successfully break into this market and give clients confidence that we could deliver for them. And the reasons for this were really, firstly, we were able to hire a great team, and that is a function of our brand and reputation. Secondly, we were able to develop a differentiated green generalist strategy and really build a niche offering for clients. And in fact, a number of the funds investments are in renewable assets. And finally, although this is an equity strategy, the team could and does leverage ICG's knowledge around structuring of transactions, with, of course, a continued focus on downside protection. All of these factors combined resulted in a highly attractive proposition for clients. And by the end of the fundraising, 3/4 of the clients who committed to the fund were new investors to ICG. As we launch subsequent vintages, we will seek to grow commitments from these clients and also introduce other ICG products to them. So these clients' additions are potentially incrementally valuable to ICG in the long term from a broader platform perspective. For sale and leaseback, which was another first-time fund, the client split dynamic was exactly the opposite, with the majority being existing clients to ICG. Sale and leaseback is a strategy which is less established in Europe, although it's very well developed in the U.S. So as a result of this, our clients needed more education about the risk and return profile and how the investments generate returns. Fortunately, the nature of sale and leaseback played to a number of our strengths, namely credit analysis of tenants, combined with real estate valuations of the underlying assets. And all of this meant we were in a prime position to bring this product to the market, given our existing in-house expertise in both Credit and real estate. And we were able to bring a number of existing clients from other strategies into the first vintage. What I can confidently say is that the success of both of these examples of growing out was due to the strategies being part of ICG, and that is a real and tangible benefit of our franchise and our scale. And this will enable us to generate incremental equity value going forward. So I've spent a lot of time looking back. I'm going to stop now and hand it back to Andreas, who will spend remaining time looking forward before we open the floor to Q&A. Thank you so much, everyone.

Thank you, Bashak. I opened by talking about long-term growth in private markets, and Bashak has gone into detail on how our breadth and scale has enabled us to grow AUM historically. Looking ahead, we believe this will continue and become increasingly clear. In the medium term, private markets are expected to grow at 10% per annum approximately, depending on the asset class. This is from a public source and aligns pretty closely with our internal views. Our waterfront of products in the scale, both materially different from 2018 and let alone 2012 should enable us to capture this growth. In that sense, we are increasingly able to help clients meet their investment objectives across all key private market strategies. Of course, different clients have set different areas of focus within private markets. Insurance companies, for example, overweight private debt because of regulatory capital treatment. By contrast, sovereign wealth funds with their long-time horizons and no regulatory capital issues are more attracted to the higher return within our structured and private equity asset class. But strategically, from an ICG perspective, the individual areas of interest is not the point. More important is that due to the successful broadening and scaling of ICG over the last decade, we're able to meet client demand across multiple asset classes globally. As I look forward to the next decade, I see a number of exciting opportunities ahead in many areas of our client franchise. I set up 3 areas here. And of course, there are some interrelationships between them. First, further expanding the client base; second, increasing share of client wallet; and third, cross-selling. Firstly, in terms of attracting new clients. Over the last decade, we have focused on client growth. As you have seen earlier, we've grown a 23% CAGR over the last 10 years. However, this growth came at the expense of penetration of wallet in the short term. But that was a conscious decision to onboard clients first and then focus on share of wallet. Given the trends of client consolidating their relationships, we want to make sure we get through the door before it closes and then focus on increasing share of wallet. And despite our historical growth, there remains a substantial opportunity to further grow our client base, particularly in the Americas and the Middle East. And as we launch new strategies that will naturally attract new investors as we saw with our infrastructure equity fund. Turning to increasing share of client wallet, the graph on the left-hand side is the natural consequence of having focused on growing client numbers in the first instance. Now that those clients are on our platform, we have a substantial opportunity to increase our penetration of wallet for larger ticket size and subsequent vintages and through cross-selling. Some overly simplistic maps. We could increase our AUM by roughly 2/3 without winning another single client. Simply, we're getting to the average AUM per client shown on this chart, that underlines the scope of the opportunity, this one lever potentially presents in the coming years. With more strategy at scale and the larger client base, cross-selling is becoming an increasing area of focus for ICG's marketing team. But of course, none of this is easy, and importantly, it takes time. This slide sets out some statistics to support that and let me walk you through what they show. Starting at the right-hand side of this page, our oldest clients, those who have been with us since 2012 or before. Of those, 62% have invested in more than 1 ICG strategy, where they have been a client of ICG. And on average, it's taking them over 4 years to make their first investment in a new strategy. Roll forward to all clients who have been with us since at least 2017 and the cross-sell rate drops to 33%. This makes perfect sense. The number of clients is much greater, given how many new clients we have onboarded between 2012 and 2017, and we have had less time to cross-sell to those clients. And that pattern is the same when you look at our entire client base today, a client who made their first investment 6 months ago is highly unlikely to have already invested in our ICG product. And with a cross-sell rate of roughly 24% today, there is a substantial opportunity to cross-sell to today's client base in the years to come. I just want to outline here a case study of one of our key relationships in Asia. We met them first in 2012. 3 years later, they're committed to Europe VI, another 3 years later to Europe VII. 2 years later to SDP IV, a new asset class, and most notably in 2021 to strategic Equity IV, so a new strategy and the doubling of their commitment to Europe VIII compared to Europe VII as well as awarding us an SMA in liquid credit. It's taken us 9 years since the first meeting and 6 years since the first commitment, but we've now cumulatively raised roughly EUR 1.6 billion from this client. Today, they are one of our largest investors globally, and I'm sure there's more to come. Interestingly, it took 5 years from their first commitment for us to cross-sell in our strategy. In this case, going from European corporate to SDP and strategic equity. So hopefully, this slide has helped you to see that cross-selling is something that requires some thought and time to capture the opportunity. Given the scale of our platform and the growth in our client numbers in recent years, I'm confident there's a lot of further ground here in the years to come. To wrap up, I'll finish by reiterating the key messages Chris outlined at the start. We've grown a scaled blue-chip global client base that perceives us as a top quartile investment performer in client services. Our ability to deliver for our clients has supported our growth up and out and will continue to do so. We are now at the point where we are relevant for the world's large investors a number of strategies and that relevance will only increase as we continue to grow. Putting those pieces together, I think ICG has huge potential to continue to grow, prudent in a compelling client offering, and I'm excited at how my team can continue to sort the business in the years to come. At this point, we will be delighted to take any Q&A, and perhaps we'll start with any questions from the room.

That was very helpful. I wonder if you can say a little bit more about your cross-selling per client? Because you've shown us the number of clients you have increasing. Presumably, other metrics people often look at the number of products per client, and that's an easy opportunity for you. How have those statistics been trending? And has that changed through time? Have you found it easier to cross-sell the different products, the same people over the last few years? Or how are you thinking about that?

Andreas, do you want to take that?

So I don't have the stats products per client at hand, so we would have to look it up. But the way it works is basically some clients just want to invest in 1 particular strategy. And that's it, and they're happy with that and they keep coming back. And others then want to have a wider relationship because they cannot deal with so many GPs. So they want to focus on less GPs. That's a trend we're clearly seeing, and that will benefit us. Just in terms of -- I mean, in terms of numbers, so we are 24% across the client base because we've grown the client base so far. If we take our European book, that's at about 40%. Now that also has grown very fast. But of course, as Bashak outlined, the U.S., the Americas and other regions have gone faster from a lower base. So if you take this as a starting point, then we would like over time to get the other regions to 40%. We think the good metrics probably will be something like 50%. We don't want to give you a higher number than this simply because, as I said at the outset, not every strategy is for everybody. Not everybody wants to invest in multiple strategies. But we see there's still substantial runway to go beyond that 24%.

Yes. Can I ask 2 questions, please? The first one, you're guiding on to give us some numbers on how your client numbers split have changed from 2012 to 2022. And I just wondered if you could tell us anything about the value of AUM by client rather than the number and that same sort of metric. And then the second question, in terms of being larger and being relevant to more clients, is there a sort of right size of fund that ICG needs to have to stay relevant. So is it the Europe fund raise is the right size or the SDP sort of EUR 5 billion that the funds had to stay that size now at the moment? Or is that not the right way to think about it?

Andreas?

Yes. So once again, I don't have that number at hand. So we have to go and check. On your second question, the larger investors, they tend to increase the minimum size of the fund they want to invest to, right? What was maybe a couple of years ago, EUR 1.5 billion, EUR 2 billion, now maybe it's EUR 2.5 billion, EUR 3 billion, EUR 4 billion, depending on the investor, especially sovereign wealth funds. So you need to have, as you alluded to a certain size and scale to even be relevant because they want to have more than 10% holding in your fund, right? But if the minimum ticket size is, let's say, EUR 250 million, your fund has to be at least EUR 250 million, right? So that means the -- our larger strategies like the European fund, Europe VIII or senior direct lending or senior equity, these are the more scaled strategies. We see them still continue to grow with future vintages. But at the same time, for example, you heard about sale and leaseback infrastructure, we also obviously plan to scale up these strategies over time, right? So again, with that, making them also more relevant for the larger investors because, again, our investor base is very institutional, right, which means they tend to write larger checks. So usually EUR 50 million onwards.

Luke, I think you had something.

Just 2 questions. Firstly, in terms of the new strategies that you've launched in recent years or to come, which areas do you see the most potential scale? So is that like infrastructure or secondaries, for example. And then just secondly, I noticed you had growth in wealth as a potential driver in the future. Just how do you guys plan to address that market? I guess you've seen like Blackstone BREIT, et cetera, going on. Just wondering what you guys think about that and the wealth opportunity going forward from there.

Yes. So in terms of which strategies, I mean, for sure, infrastructure, right? Because when you look at the investor intentions because we look at them every quarter, you can see them on frequent where they poll. That's probably the 1 asset class within private markets where there is still that appetite to commit and to invest. So clearly, that's one of the areas. An area where there's, at the moment, a bit less appetite, but where we really see a lot of opportunities, not only to deploy capital at the moment, but also the growth is the real estate platform. As you know, we hired Krista Nikolic from Starwood, and we're really setting out at the moment, seeding a couple of funds. And I personally believe you'll see some good things coming out of that platform. So that's probably the 2 I would put high on the list. Time would tell, we'll see. And the second question was wealth. Now wealth, we raised so far around EUR 2 billion from the wealth channel relative to what I just shown the EUR 100 billion, that's a very small number because again, our focus was very much on growing the institutional franchise, simply because as I said earlier, the door is closing because of GP consolidation. So we want to make sure we get on board. Second, we didn't have the -- I mean our brand keeps evolving. But when you go into the private wealth channel, brand is quite important. Blackstone is a good example, right? Some of the other names. And so for us, building out an institutional side, there's obviously a positive spillover on the wealth channel, but that's also the reason why we were a bit more careful even before the BREIT and [Becrafting] happened. So what we've done? We've done it through feeder funds, just really traditional locked-up structures. For example, if you take strategic equity, we raised 10% of that strategy for the wealth channel with 2 partners. They're also very keen to get on board for the next vintage. We actually probably onboard 1 or 2 others. So I can see potential there. So yes, so we'll definitely play in the channel. But compared to some of the big players, that hasn't been our first and foremost priority, partly also because, as I said, with let's say, 600-odd clients on board, there's still a lot of runway in the institutional world for us to keep growing. So it's something we are mindful. We want to definitely have the discussions, and we have dedicated people for the channel, but it's not going to be a huge part of our fundraising anytime soon. And as a concern, semi-liquids, we're obviously carefully tracking this because we were actually in discussions with some potential partners on semi-liquid structures. Let's see, it will be interesting to see how this obviously evolves given what's going in other gatings.

David?

Two for me as well, please. Early on in the slide, you had a slide, I guess, outlined the traditional reasons as to why as I look, I just would want to invest in private markets. I mean how has that involvement, particularly with the core events in the last year are kind of new factors coming into the fold. A client is challenging some of those traditional pool factors as to why they want to come in. So I'd just be interested in sort of any thoughts you might have there? And then just in terms of -- when you're talking about the re-ups part of the growth strategy, how important is it when clients do desire to put more money into a new fund? How important is it they've already had, say, cash return room from the vintages they're already in? And I guess, what's the balance of like fresh money they're putting in that you haven't yet returned? And how important is it, they've already actually had some money back from those private vintages to actually reinvest?

And yes, it's looking probably [indiscernible], well...

I'll take the second one. So I think to your point around returning capital, that's obviously very, very important because it effectively serves as proof of concept, right? So you do what you say. It also makes an investor's decision a lot easier when they're going to their own committees to invest in a subsequent vintage when they can show that they've had money returned. Fortunately, we have -- I did the benchmarking not too long ago, top quartile and top decile DPI almost across every strategy. And I think that reinforces and facilitates new commitments to subsequent vintages. So a very roundabout way of saying, very important.

Follow up on that just very quickly. I mean, obviously one of the features we've seen in ICG recently is that the gap between vintages has probably reduced particularly in the last 5 or so years. So to what extent does that present a challenge that -- I guess the types of the fundraising time that they've actually had less money back.

Well, look, that's -- I don't think that's a ICG-specific phenomenon. That's the general market, all vintages of -- the timing between vintages has narrowed. I'll give you one example. So Fund VI -- Europe VII has already returned, I think, 45% DPI. So yes, but it doesn't mean that you can't still return capital even though the vintages. It's just -- it's a matter of picking the right investments. And I think we're particularly good about.