Q2 2025 GCM Grosvenor Inc Earnings Call
Good day and welcome to the GCM Grosvenor second quarter 2025 results webcast.
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As a reminder, this call will be recorded.
I would now like to hand the call over to Stacey Selinger head of investors relations. You may begin
Thank you. Good morning and welcome to GCM Grover's. Second quarter 2025 earnings call. Today, I am joined by GCM Grover's chairman and chief executive officer. Michael, saxs President John, Leven and Chief Financial Officer. Pam Bentley before we discuss this quarter's results. A reminder, that all statements made on this call that do not relate to matters of historical fact, should be considered forward-looking statements.
This include statements regarding our current expectations for the business, our financial performance and projections.
These statements are neither promises, nor guarantees. They involve known and unknown, risks, uncertainties, and other important factors that may cause our actual results to differ materially from those indicated by the forward-looking statements on this call.
Please refer to the factors in the risk. Factor section of our 10K, our other filings with the Securities and Exchange Commission, and our earnings release. All of which are available on the public shareholder section of our website.
Joining us. And with that, I'll turn the call over to Michael to discuss our results.
Thank you, Stacy.
We are pleased to report another strong quarter for GCM grovener led by strong investment performance, strong fundraising Financial results in line, with expectations and positive. Business developments that will benefit us in the long run
For the quarter, our fee-related earnings, adjusted EBITDA, and adjusted net income are up 6%, 9%, and 9%, respectively, compared to the second quarter of 2024.
Year to date. Fee related, earnings adjusted, EBA, and adjusted. Net income were up 14% 17 and 19% as compared to the first half of 2024.
Our fee related, earnings margin for the quarter was 42%, which is 200 basis points higher than the second quarter of last year.
We ended the quarter with 86 billion dollars of total assets under management a 5% increase compared to the end of the first quarter of 2025,
Our AUM growth was led by excellent ARS performance, moderate AR inflows, and another strong fundraising quarter for private market strategies.
In total, we raised 2.4 billion dollars in the quarter. Bringing our first half of the Year fundraising to 5.3 billion. A 52% increase from the first half of 2024 and our highest first half fundraising total on record.
There continues to be a tremendous amount of activity with a very visible full fundraising pipeline.
Given the strong fundraising thus far and our significant pipeline. Our goal of 2025 fundraising exceeding 2024 fundraising is highly likely. The only question is by how much we exceed last year's total,
we expect second half fundraising to be weighted towards the fourth quarter.
The manned activity levels and pipeline are strong for Alternatives. Generally in our investment, performance has been solid
There are 3 areas of recent particular strength around the firm worth noting.
The first is infrastructure which accounted for 1.9 billion of fundraising in the first half of the year and remains a great contributor to growth within the firm.
While not a new story, the growth is persistent and likely accelerating.
John will talk about our infrastructure platform. Its Innovation and its prospects during his remarks.
Private credit was the highest contributor to our fundraising for the quarter.
We believe that market remains strong and importantly for us is evolving in ways that benefit our business. We expect investors to increase seek greater diversification within their private credit allocations. And as we have discussed in the past, our sourcing breath and our flexibility to invest via funds and directly including co-investments in secondaries whether in credit focused separate accounts or specialized funds leaves us. Well positioned to continue to grow our credit vertical
the third point, we wanted to touch on relates to our absolute return strategies vertical which had an excellent quarter led by strong investment results and strong first half, fundraising
Performance for the quarter was good with our multi strategy, composite returning, approximately 6% on a growth spaces, increasing fee paying AUM, heading into the second half of the year. In addition that strong performance has resulted in an additional 18 million dollars of acred unrealized annual performance fees as of June 30th.
Our ARS strategy saw 1 billion dollars of gross fund flows for the first half of the year with net inflows of approximately 400 million for the second quarter.
While we continue to model ARS. As a flat, net flows business in our internal forecasts, the sentiment has clearly improved the combination of performance and flows as seen fee paying AUM in ARS up 7% year to date and 10% over the last 12 months.
Regard to important operational. Milestones and starting to generate sales. We continue to emphasize the long-term nature of this opportunity and caution against over optimistic. Short-term assumptions that said we are very optimistic with regard to this Channel's potential for us in the intermediate to long term.
Next we're in the market with a structured alternative investment solution in the form of a CFO where the assets will be invested in our credit strategy. We expect to close that transaction in the second half of the year, which will contribute to fundraising. This is our second CFO and we intend to continue to sponsor, collateralized fund obligations from time to time going forward.
This wouldn't be a second quarter 2025 earnings call without mentioning AI which is a key strategic Focus inside of grovener. It is a daily conversation somewhere within the firm.
Adoption and use are increasing rapidly.
And it will no doubt. Make us a better more efficient and more profitable company over time.
Finally, with regard to the macro environment.
Our fundraising results to date prove out the strong, continuing demand for alternative investments.
Today, there is more clarity regarding tax policy and the environment feels better compared to the period. Immediately following the introduction of increased tariffs. At the beginning of the second quarter,
Transaction activity seems to be starting to accelerate from recent lows, and the IPO market has some life with regard to certain sectors' realizations. Activity has ticked up since 2024.
That said, we continue to see plenty of volatility around, interest rates, tariffs and policy generally. And we have not abandoned caution, our teams remain focused on investing client capital on a disciplined, programmatic basis, and are well, positioned to take advantage of opportunities with 12 billion of tribe powder.
We remain positioned to benefit significantly from unlocked value in our unrealized carried interest at NAV, which surpassed $900 million this quarter.
Half of this carry balance or approximately 450 million dollars is owned by The Firm, which translates into approximately $2.30 per share.
That 450 million in firm share of carry at nav, was up approximately 9% or 35 million from last quarter. And is over 3 times higher than where it was at the end of 2020. Despite the firm collecting nearly a hundred million dollars of Revenue during that period of time.
Finally, we're pleased to announce the GCM. Grovener will hold host. Its first investor day on October 15th. In New York, we look forward to showcasing our team, highlighting, our value proposition and walking you through our growth profile at that time.
We hope you can join us. And with that, I'll turn the call over to John.
Thank you and good morning is Michael noted, the focus of my remarks. This quarter is our infrastructure platform.
That business has been a key growth driver for us and more broadly. The infrastructure platform is emblematic of the firm's value, proposition to clients
Our competitive advantages and our growth opportunities across the platform and the different verticals.
Let's first briefly touch on the attractiveness of infrastructure as an asset class.
Investors are drawn to infrastructures predictable, cash flows.
Long duration and inflation hedging properties.
Core Plus and value. Add infrastructure assets, which is our Focus tend to be less correlated to traditional equity and fixed income markets offering resiliency amidst Market volatility.
The global need for infrastructure capital is massive and Global demand for infrastructures properties. As a risk asset, has major Tailwind
Fueled by aging systems, urbanization, energy, transition and digital Innovation some estimates. Put the need for infrastructure capital in excess of 100 trillion dollars over the coming 15 years.
While infrastructure assets are as old as the world infrastructure as an investable asset class is still relatively new.
Many investors are still underallocated to infrastructure relative to asset, allocation plans. Recent studies suggest that over 90% of investors plan to either maintain or grow their infrastructure, allocations over the future periods.
As the asset class matures, we're seeing the same type of evolution. We saw in the private Equity markets but it's happening, much faster. We see thoughtful diversification, across Market capitalizations sub, sectors and geographies,
Robust, secondaries and co-investment markets. Our infrastructure platform is, ideally positioned to capitalize on these trends.
With over 2 Decades of experience, our platform is among the most tenured in the industry, its Global by Design with investment professionals across the US Canada, Europe and Asia.
What sets us apart, is the breadth depths and flexibility of our manufacturing engine in combination with a client delivery mechanism? That can meet varied needs.
Our sourcing models Broad and scalable or deeper relationships across the infrastructure. Ecosystem, unlock investment opportunities of all types. Direct Control Investments, Consortium deals co-investments and secondaries flow.
We look at hundreds, if not thousands, of deals a year with our flexible investment model. We are closing on some sort of transaction, whether it be a fund commitment or a direct-oriented deal, every 2 to 3 weeks.
This origination platform enables us to build Diversified portfolios for our clients quickly. And cost-effectively,
We're especially strong in small and mid-cap Investments as segments. Offered an overlooked by many investors.
This combination of robust origination asset-based, focus and quicker deployment, enables us to build more holistic, Client Solutions that are more Diversified than your typical in infrastructure fund. Our client offerings, have exposure to a large number of Investments, and those Investments are Diversified by Investment Partners geography and sector.
Infrastructure has been the leading contributor to our fundraiser, fundraising success. This year accounting for over 35% of total Capital raised.
Since going public, we've raised 12.5 billion dollars for infrastructure, proof of the strong, demand for our strategies, in the trust placed in Us by our clients.
The results speak for themselves are infrastructure. AUM is nearly tripled since 2020 from 6 billion to 17 billion dollars of 26% cagar,
We now serve over 150 institutional clients across customized Solutions and specialized funds. We're 1 of the few firms capable of being a complete solution for clients infrastructure allocations and our separate account practices flourished with both comprehensive and completion offerings.
But we're not just growing we're innovating as previously discussed, we lost to the infrastructure interval fund this year with a 320 million seated portfolio. It's an early mover in the individual investor Channel with a unique position in the market and we're encouraged by early traction.
Additionally, this quarter, we announced our partnership with Wilshire indexes to launch the Ft Wilshire private markets infrastructure index. The first comprehensive Benchmark for private infrastructure, Wilshire indexes will govern the index while we contribute market and risk insights. We also plan to launch single point of entry investment vehicles. Tracking the index further expanding access to a diversified infrastructure for broad groups of investors.
We Believe infrastructure, Capital formation will continue to outpace broader, private markets and with our experience sourcing capabilities and Innovation were positioned to capture more than our fair share of that growth. And with that, I'll turn the call over to pan.
Thanks, John. We are pleased with our second quarter results, which highlight the multiple avenues we have to achieve success and drive growth.
Given our strong fundraising and investment performance. This quarter assets under management grew to 86 billion dollars and fee paying AUM. Grew to 69 billion a 9% increase year-over-year. Respectively,
Our contract did not yet. See paying AUM. Grew 19% year-over-year to 8.7 billion dollars. Providing a foundation for continued organic growth. As that Capital converts to fee paying AUM over the next few years.
Year to date private markets management fees, grew 11% year-over-year from a combination of solid fundraising and conversion of contracted. Not yet, fee paying AUM.
We expect third quarter, private markets management, fees, to increase in the low single digits on a sequential quarter basis. As a reminder, we are not expecting material, catch up fees in the back, half of the year.
Absolute return, strategies had a strong first half of the Year, both from investment performance and flows.
We anticipate that ARS management teams in the third quarter will increase slightly from this quarter.
Turning to expenses. Our compensation philosophy is centered on attracting and retaining top talent by aligning their interests. With those of our clients and shareholders,
We do this through a combination of annual and long-term incentives, including FR, compensation incentive fee, related, compensation and Equity Awards.
We remain disciplined in managing expenses and second quarter FR, compensation slightly declined, from the first quarter to 37 million.
Non-gaap General administrative and other expenses were stable at 21 million.
We expect FR compensation, and our non-gaap general administrative and other expenses to remain stable in the third quarter.
Of these factors on a year-to-date basis. Our fee related earnings grew 14% year-over-year resulting in expansion of our F margin to 43%,
Returning to incentive fees, we realized 16 million in the quarter comprised of 1 million of annual performance fees and 15 million of carried interest.
We're seeing some positive indicators in the deal Market that will eventually translate into more normalized levels of carry realizations.
We have substantial embedded, incentive fee, earnings Potential from unrealized carried interest of over 900 million dollars as a quarter end.
As for annual performance fees, our run rate now stands at 32 million based on an assumed average, annual gross return of 8% across multi-strategy portfolios.
Given our strong ARS investment performance year to date. We have $18 million in unrealized performance fees as of quarter end in addition to the 5 million dollars we realized during the first half of the year.
Last quarter, we spoke about our Japanese partnership, which we believe will provide significant lift to our strategic positioning and capital-raising efforts in the region.
The partnership included the issuance of approximately 3.8 million Class A shares at a price of $13.32 per share.
Separately in the quarter, we actively managed dilution from employee stock-based compensation through our buyback program and repurchased approximately $25 million of Class A stock.
This morning, we announced a 30 million dollar increase to our buyback. Authorization bringing the remaining amount of available to 87 million
Our financial position is strong reflecting robust cash, generation investment appreciation and growing unrealized carried interest.
Our primary focus remains on strategically investing for long-term growth. We also continue to pay a healthy quarterly dividend of 11 cents per share with potential for future increases as earnings momentum builds.
Our business is built on a strong foundation and is well positioned to capitalize on numerous opportunities for growth and scaling. We are excited to create further value for our clients and shareholders and remain confident in our long-term goal to double our 23 F by 2028.
Thank you again for joining us and we're now happy to take your questions.
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Again you can press star 1 to ask a question and we'll pause for just a moment to allow everyone an opportunity to sign up for questions.
And we'll now take your first question coming from Chris.
To the toski with Oppenheimer and Company.
Good morning and thanks for taking the question. Um, you talked a bit about the, uh, the, the Evergreen, uh, retail vehicle, which was, you know, seated with 300 billion of of, institutional money. And, um, I'm wondering if you could talk a bit about the
Retail uptake on that and the strategy for building that out. And and also the status on the private Equity vehicle
Sure, thanks for the question. Chris. Um, as you know,
Uh, we have a distribution partner for that in infrastructure, interval fund. They have a full team of
Uh, salespeople that are out in the market every day.
uh we also have the Grove Lane team helping with that and that team as we mentioned is building and uh, you know, I said my remarks um, we're very confident in the
Uh future of that channel for us and and broadly and specifically with regard to this product. We think it's a
Take I think as I mentioned my our biggest, you know, concern there is that nobody gets too carried away. In terms of the speed, we think it is a multi-year build. Uh but we're certainly encouraged.
By everything that we see.
Okay. And and and Chris, I'm not private Equity side, um, you're probably mentioning something we had talked about a bit ago. Uh, uh, it was probably last year the year before where, which is really different from our kind of core individual investor strategy. Which we noted at the time that was a situation where we were not the uh manager of a registered fund. We were just like a, a sub-advisor to somebody else's vehicle. Almost like think of it as a separate account Chris and our view on that was if they raised money, right? And if they don't um uh we would always be in the business of making sure we have our own uh, private Equity product, just like we do in the infrastructure space and so what you should expect from us in terms of what we're talking about in private equity. And again, as Michael just said these things take time is our goal would be and we work on it every day that at some point in time, you see something from us in private equity and hopefully not too long of a period of time that's similar.
First infrastructure in the sense that it would be our product that we manage that may or may not have a distribution. Uh, partner certainly Grove Lane would work on it. Uh, that would be seated by 1 of our clients or 1 of our relationships that would have Assets in it sourced out of our portfolio which was 1 of the great attributes of the infrastructure product. And and that's where all for our our Focus will be and and obviously will communicate that in due course.
Okay, thank you. That's it for me today.
Keypad.
Your next question is coming from the line of Ken Wardington with JP Morgan.
Hi, good morning. Thanks for taking the question. Um, so absolute returns. Um.
your absolute return, business had better returns better growth sales solid, you know, gross Redemption levels,
Does it seem like to queue is a 1-off?
Um, or do you feel like the business is kind of...
Really turned the quarter here and and not that we would expect you know, positive flows, you know, forever here. But like you know have we sort of reached a a Tipping Point for that business given this combination of better market, conditions, better performance, uh, and so on.
Thanks, Ken, for the question. Um, as I said in my remarks, we have not changed our internal forecasting with regard to flat flows.
um, that said
The performance, uh, this year, the performance of the last couple of years and the performance Rebound in the second quarter. Uh, no doubt helped. Uh, and typically when you have, you know, good performance your pipeline builds in the wake of that performance. And so we're not uh, moving off that internal assumption.
Set, but it's clearly a better. Uh, we're clearly in a better position, a better environment with a better outlook for ARS uh than we've been in for a while. And we've seen that in the last 6 months.
Okay, and then, uh, still absolutely return, um, the fee rate, which had been, you know? So resilient, uh, fell a couple basis points this quarter. Maybe talk about the, uh, influences of the fee rate. This quarter, was it flows or how is the mix adjusting to drive the, you know, fee rate numbers that, uh, we see in the deck?
Yeah, the demand the demand is more relevant to John's Point than it's been in a while quite a while. But there's not we we're not experiencing uh you know, significant conversation around fee and feel the fees is stable.
But you can't really see this in the numbers necessary, but it's probably just interesting uh, to to you in terms of how people are thinking about their business and and don't hold me to the exact numbers because I don't quite remember but there was a period of time around, you know, Liberation day where you had probably a market draw down in the low, double digit type of a range, and that's a period of time where we can capture performance and see what that looks like and you had something like a 1%, you know, uh, sorry a 10% capture of that draw down, which is a very good period of time for protective capital. And often, when you come out of an environment like that, the challenge becomes. Do you participate in the rebound and sometimes you don't and in this period of time, you saw some nice capture on the rebound as well. And I think that period of time and that period of time of volatility has been something that I think is opening the eyes of some. Some of the investor community.
Great, thank you very much.
Hi, good morning. Um, how have re-ups been in this kind of volatile environment versus a typical year? You know, have you seen any pauses at all? Or how is that, I guess, percentage of total fundraising been trending?
So, John, you have some specifics on fundraising?
Re-ups new investors things like that, and it's probably worth sharing that. But um, in general, the re-ups are
Fantastically, you know, they're they remain very, very strong and we remain kind of a super high reup.
Uh, business and, um, our, you know, our our, our client tenure in the re-ups are continuing to be, you know, a very strong positive.
Feature of the business, uh, with no degradation there whatsoever.
Okay. Yeah. And
Go ahead.
I was just gonna say to follow up on Michael's points.
What what you saw during a period of time, maybe in 23, which was obviously like a weaker period of time of capital formation for the industry for us as you saw, you know, the elongation of re-up periods. You didn't see people not re-upping you just saw people slowing down programs because of denominator affect Market uncertainty and things of that nature. We we always said 24 would be better than 203 that happened. We always said 25 is going to be better than 24 is Michael 7 is remarks. We feel good about 25 being better than 24 and and and and part of that is just a function of kind of re upcycles getting back to poly more normalized time frames and and in in 1 of the things that we really like in our business
In particular, if you look at capital raising over long periods of time in any given year, you get about 70% to 80% of that capital raising coming from your existing clients. And of that,
Uh, you have about half of that being people that are just reopening with you to do the same thing, they've always done about half of that is an existing client doing something new with you, which is just a great example, of the power of the, uh, of the Cross sell of the power of the value proposition to clients, as you can deal with relationships and then obviously, you're picking up new clients every year as well.
Okay. Um and then are you seeing any fee pressures in private markets in this environment? I mean I I I know some of the specialized funds are coming on at higher fees but the overall fee rate and private markets is down uh you know a little bit. Just curious if there's any pressures in specific verticals.
No, the the fee.
You know what, I want, the fee conversations have been constructive. Uh,
Everywhere. And we're not.
Uh, it's not a period of uh significant focus on fee.
Okay, great. Thank you.
Your next question is coming from the line of Bill cats with TD Cowen.
Um, if you will, and then relatedly, I was wondering if you could just speak to the fact that you feel pretty good about these sales opportunities in the second half of the year. Where do you sort of see that across the verticals, whether it be the SMA side or the specialized side? Thank you.
I mean, I'll take the first part of the question and infrastructure and let Michael comment on the, on the, on the, on the back half of your flows picture. You know, on the infrastructure side and I think 1 of the things I would say before diving deep. Here is the, the I could give you a pretty similar answer to this question. Uh, bill for for, for private Equity. I could give it to you similar for private credit the other verticals, Etc. And it's the idea of the flexible investment model and or you can call the open architecture investment model. Um, and what that means is as, you know, as a Solutions provider, our ability to deploy capital is in other people's funds, which is, you know, the allocative nature of the business, which in our infrastructure practice is actually pretty small. It's probably 20 to 30% of what we do.
And then we can deploy capital on a co-investment basis and an infrastructure. The co-investment market is still a little bit immature and early, so co-invests aren't just necessarily like, hey, you know, here's the fpv you got 3 weeks to do the deal, which is some of what you see in private Equity but it's it could be a Consortium deal. You could be a co-lead on the, on the, on the deal, we could be larger than the sponsor on the deal. There's a lot of different ways that can look you got to
A very active becoming, I should say more active secondaries Market. I actually think. And we actually think that market and infrastructure is more interesting on the single asset, secondary side, uh, because you have people that own assets for a very long period of time, may want to get out when other people don't and you can buy into individual assets and interesting points. And then we also have our our infrastructure Advantage strategy, uh, which is a business where we can do control infrastructure and then when you have that many ways to invest,
Uh, you're not. You don't only have your own origination if you think about a direct infrastructure firm. If they're super, super productive, um, maybe they do 3 or 4 deals in a year.
But when you're leveraging your own origination plus, everyone else is origination because you can participate in in deals because as a co-investor as a single asset uh secondary player, Etc, you're just seeing a lot more deal flow.
And so, as I said in the script, we could be closing on deals, every few weeks that would be, you know, uh, something that would be every few months, or every 4 months at a, at a quote, unquote, direct firm. And so, I think as as as you think about infrastructure much more as a, maybe a credit asset, given the risk profile as opposed to a private Equity asset.
Diversification is super, super important. You can't, you're not going to have 4Xs that bail out some of your tougher investments, right? And so you want to really avoid left tail risk, and one of the best ways we think to do that is diversification.
And our open architecture model of different ways to invest in. Just focus on net return. Don't worry about, you know, what type of deal it's called, um, has really served our clients well, uh, because we can create Diversified portfolios, we can create them quickly with minimal J curve, and we can, and we can make them uh, on an economically efficient basis. And we're doing that activity globally.
thanks Bill for the questions, the with regard to fundraising, we obviously had a very, very strong first half and we have said, you know, we're going to
We're going to raise more Capital, we're going to have higher fundraising this year than we did last year. And I said my remarks. The the only question is by how much we have a very full pipeline, we have a lot of uh, opportunity that is
Uh, in the late stages of the pipeline. Uh, and so we're confident with regard to fundraising for the second half and frankly into, you know, the first quarter or so of next year, the, we we did say and I did say that, you know, the second half fundraising will be weighted towards the fourth quarter, just by, you know, looking
But it's a very good picture on fundraising and it's been and we've been saying that for a little while, it's been proven, uh, it's been proven out by the results. 1 thing that I do want to mention is we don't have
Uh, you know, a lot of we don't have ketchup fee product in the market, to a significant degree. So we're not expecting to see big numbers there at all in the second half. And so, all of that this fundraising, which we think will be substantial, uh, isn't going to really drive the, the needle. Much, uh, you know, isn't going to move the needle much on, on, on actual 25 revenue. And so the
You know, the guidance that Pam gave for Q3 uh, is, is, is pretty good guidance. And even though we do anticipate a very healthy, uh, you know, Q3 in a, in a, in a healthier Q4 on, fundraising, we're going to start to see that, uh, uh, kick in on Revenue as we move into the next year.
Okay, super helpful. And if I guess maybe 1 follow up. Um, normally I wouldn't ask this kind of question on a call here, but I'm serving a treat that you sort of offer it up in the, in your prepared marks. Can you talk a little bit about the AI opportunity? Um, maybe at either the portfolio level or at the operational level and how we should think about maybe modeling that through from an earnings perspective?
Thank you.
So let me give 1 couple of sentences and then John, maybe jump in, because John is sending a tremendous amount of time on this, but it, it it we are focused on this opportunity.
Pretty much everywhere. And so we, when I said, you know, somewhere in The Firm every day, there are there, there's an AI conversation, that's means
Each investment vertical and on the investment side, and how does it help us?
To be more efficient investors, how does it help us from a, a margin of workload perspective, how does it help us? You know, ultimately to make better investment decisions. And then from an operational perspective,
Everywhere in the firm as well. So outside of the investment teams, how does it help our client group efforts on multiple levels? How does it help us inside our legal and finance teams on multiple levels and uh, it, you know, it is just a, you know. I I was I joke, you know, it can't, we can't have a a Q2 25 call without mentioning it. It really is, you know, kind of an everyday thing somewhere in The Firm. That's got a lot of Senior Management focused attention uh, and time and has I think a lot of promise and it's actually, you know, something that is very, uh, constructive with regard to sleeping at night,
Long-term margin, uh, and efficiency John. Yeah, I would just add. I would obviously do anything specific in your model, Bill. Only in the sense that what we've told you is,
We've got operating leverage in the business. We've shown continued, you know, margin Improvement. Uh, something on the order of I don't know, 1,200 basis points or something since 5 years ago, and we tell we told you, we think there's still margin to go and I think it's all kind of captured in this so I wouldn't, it's not like to me a unique modeling exercise but it's it's facilitating obviously that scalability.
You know, I think that, um, without offending, all of my other wonderful 550 colleagues. My favorite meeting of the month that we have is with me and our chief technology officer. We meet with our top 5 users of Enterprise chat, GPT every single month.
and we do that to understand what they're using it for, what's been successful, so that we can then have uh best practices spread out throughout the firm because to Michael's point
It's happening every day and everywhere with the firm, and what our job is as a leadership team is to make sure that we can figure out how to scale those best practices across the organization without damping that entrepreneurial spirit and without damping that curiosity that we're seeing across the employee base. I could give you numerous examples of it, and none of them would really make any big sense to you, but they're all little wins. I'll give you a small one for fun. Our tax team just recently built a custom GPT.
Uh, that enables them to, uh, read tax returns, uh, and automatically enter data that used to be manual.
Have that be automatically read and input it into our data link. All of those things are fascinating way usages, the first draft of a marketing deck, you might create for a client
That can come out of, uh, of of of, of a of a GPT and and your ability, then to obviously make it appropriate.
For your organization, make it accurate because we all know it can hallucinate. There's just exciting use cases, kind of all over the place and we encourage people to think about it, not only as a productivity and an efficiency tool, but also think of it as a thought partner and a creative partner and not limits, not limit the the power of
It's intellect, for lack of a better word. I just think you're seeing that all across the world, Bill, all across the industry, and it's just obviously such early days.
Thank you. Appreciate the update.
Your next question is coming from the line of crisp and love with Piper Sandler.
Thank you, uh, good morning. Um, first on, fundraising, do you expect a first closed for GSF 4 in the second half? And then are there any other meaningful closest we should be looking out for, um, in the second half that are currently in Market?
We had, uh, you don't see it in this because it happened subsequent to the quarter, but we had our first close for GSF in July.
Um, and so we'll talk more about that, uh, next quarter. And the other, uh, product that we would expect to have a first close on towards the end of this year is our CIS for, uh, infrastructure product.
Great, John. I appreciate that. And then just one last modeling question. Is your 5% to 8% private markets management fee growth for the year unchanged? I just don't think I heard any color on that in the prepared remarks.
Yes, on on unchanged.
Great. Uh, appreciate you taking my questions.
At this time.
I'll now turn the call back to you for any closing remarks.
Thank you, thank you, everyone, for joining us today. We appreciate the interest in the questions and, uh, we look forward to speaking with you again next quarter, if not sooner. Have a great day.
Ladies and gentlemen, thank you for participating in today's conference. This concludes today's program. We hope everyone has a great day. You may all disconnect.