Q2 2026 Ridgepost Capital Inc Earnings Call

August 5, 2026

Operator: Good morning, welcome to Ridgepost Capital's Q2 2026 Earnings Conference Call. My name is Latif, and I will be coordinating your call today. Currently, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. As a reminder, today's conference call is being recorded. I will now pass the call to your host, Brian McKenna, Vice President, Investor Relations. Brian, please go ahead.

Speaker #1: Currently, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. As a reminder, today's conference call is being recorded.

Brian McKenna: Thank you, operator, thank you all for joining our call this morning. With us today, we have Luke Sarsfield, Chairman and Chief Executive Officer, and Amanda Coussens, EVP, Chief Financial Officer. After our prepared remarks, RJ Jensen, EVP, Head of M&A and Strategy, and Sarita Jairath, EVP, Global Head of Client Solutions, will also be available for the Q&A session. Before we begin, I'd like to remind everyone that this conference call, as well as the presentation slides, may include forward-looking statements within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect management's current plans, estimates, and expectations and are inherently uncertain.

Brian McKenna: Thank you, operator, thank you all for joining our call this morning. With us today, we have Luke Sarsfield, Chairman and Chief Executive Officer, and Amanda Coussens, EVP, Chief Financial Officer. After our prepared remarks, Arjay Jensen, EVP, Head of M&A and Strategy, and Sarita Jairath, EVP, Global Head of Client Solutions, will also be available for the Q&A session. Before we begin, I'd like to remind everyone that this conference call, as well as the presentation slides, may include forward-looking statements within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect management's current plans, estimates, and expectations and are inherently uncertain.

Speaker #2: operator, and thank you all for joining our call this morning. With us today we have Luke Sarsfield, Chairman and Chief Executive Officer; and Amanda Cousins, EVP, Chief Financial Officer.

Speaker #2: EVP, Global Head of Client Solutions, will also be available for the Q&A session. Before we begin, I'd like to remind everyone that this conference call, as well as the presentation slides, may include forward-looking statements within the meeting of the Federal Securities Laws, including the Private Securities Litigation Reform Act of 1995.

Speaker #2: Forward-looking statements reflect management's current plans estimates and expectations and are inherently uncertain. Actual results for future periods may by forward-looking statements due to a number of differ materially from those expressed or implied risks and uncertainties that are described in greater detail in our earnings release and in our periodic reports filed from time to time with the SEC.

Brian McKenna: Actual results for future periods may differ materially from those expressed or implied by forward-looking statements due to a number of risks and uncertainties that are described in greater detail in our earnings release and in our periodic reports filed from time to time with the SEC. The forward-looking statements included are made only as of the date hereof. We undertake no obligation to update or revise any forward-looking statements as a result of new information or future events, except as otherwise required by law. Please note that during this call, we'll reference certain non-GAAP measures that we believe can be useful in evaluating the company's performance. A reconciliation of these measures to the most directly comparable GAAP measures is available in the presentation slides posted on our website and in our filings with the SEC.

Speaker #2: The forward-looking statements included are made only as of the date hereof. We undertake no obligation to update or revise any forward-looking statements as a result of new information or future events.

Speaker #2: Except as otherwise required by law, please note that during this call we'll reference certain non-GAAP measures that we believe can be useful in evaluating the company's performance.

Speaker #2: A reconciliation of these measures to the most directly comparable GAAP measures is available in the presentation slides posted on our website and in our filings with the SEC.

Speaker #2: In addition, we'll provide certain historical performance metrics for our funds and further details can be found in the presentation slides. Of course, past performance does not guarantee future results.

Brian McKenna: In addition, we will provide certain historical performance metrics for our funds, and further details can be found in the presentation slides. Of course, past performance does not guarantee future results. Before I turn it over to Luke, I want to spend 1 minute sharing my perspective on why I am so excited to be at Ridgepost Capital. I spent 12+ years in sell-side equity research covering financials, specifically the alternative asset managers and BDCs. I have interacted with a number of different companies and management teams across the industry. What stood out to me? First, the people, culture, and collaboration. Second, the durability of the model. Ridgepost Capital is one of the only pure-play, capital-light, management fee-based alternative asset managers in the public market. Third, which I think is most important, the firm continues to deliver impressive investment performance. I am thrilled to be here.

Brian McKenna: In addition, we will provide certain historical performance metrics for our funds, and further details can be found in the presentation slides. Of course, past performance does not guarantee future results. Before I turn it over to Luke, I want to spend a minute sharing my perspective on why I am so excited to be at Ridgepost Capital. I spent 12+ years in sell-side equity research covering financials, specifically the alternative asset managers and BDCs. I have interacted with a number of different companies and management teams across the industry. What stood out to me? First, the people, culture, and collaboration. Second, the durability of the model. Ridgepost Capital is one of the only pure-play, capital-light, management fee-based alternative asset managers in the public market. Third, which I think is most important, the firm continues to deliver impressive investment performance. I am thrilled to be here.

Speaker #2: Before I turn it over to Luke, I want to spend a minute sharing my perspective on why I'm so excited to be at Ridge Post Capital.

Speaker #2: I spent 12-plus years in sell-side equity research covering financials, specifically the alternative asset managers and BDCs, so management teams across the industry. So what stood out to me?

Speaker #2: I've interacted with a number of different companies and First, the people, culture, and collaboration. Second, the durability of the model. Ridge Post Capital is one of the only pure-play capital-like management fee-based alternative asset managers in the public markets.

Speaker #2: And third, which I think is most important, the firm continues to deliver impressive investment performance. I'm thrilled to be here. I look forward to working with the team, as we continue to tell and educate the market on the Ridge Post Capital story, and I'm excited to interact with all of our stakeholders in the coming months and quarters.

Brian McKenna: I look forward to working with the team as we continue to tell and educate the market on the Ridgepost Capital story, and I am excited to interact with all of our stakeholders in the coming months and quarters. With that, I will turn the call over to Luke.

Speaker #2: With that, I'll turn the call over to Luke.

Speaker #3: Thank you, Brian. Good morning, everyone, and thank you for joining our call today. I'd like to start by welcoming Brian to Ridge Post Capital.

Luke Sarsfield: Thank you, Brian. Good morning, everyone, and thank you for joining our call today. I would like to start by welcoming Brian to Ridgepost Capital. Brian recently joined Ridgepost Capital to lead our investor relations efforts. Brian comes from Citizens, where he was a senior equity research analyst covering the alternative asset management and BDC sectors. His deep knowledge of our industry and strong relationships within the investment community make him an excellent addition to our team as we continue to prioritize transparency, accessibility, and proactive engagement with our shareholders. Many of you will have the opportunity to connect with Brian in the coming weeks and months, and we look forward to further strengthening our dialogue with the investment community. On an unrelated note, I did want to share some very sad news relating to the Ridgepost Capital family.

Speaker #3: Brian recently joined Ridge Post Capital to lead our investor relation efforts. Brian comes from Citizens, where he was a senior equity research analyst covering the alternative asset management and BDC sectors.

Speaker #3: His deep knowledge of our industry and strong relationships within the investment community make him an excellent addition to our team as we continue to prioritize transparency, accessibility, and proactive engagement with our shareholders.

Speaker #3: Many of you will have the opportunity to connect with Brian in the coming weeks and months, and we look forward to further strengthening our dialogue with the investment community.

Speaker #3: On an unrelated note, I did want to share some very sad news relating to the Ridge Post Capital family. One of our long-serving board members, Robert Stuart Jr., unexpectedly passed away recently.

Luke Sarsfield: One of our long-serving board members, Robert Stewart Jr., unexpectedly passed away recently. On behalf of everyone at Ridgepost Capital, we extend our deepest condolences to Rob's family and loved ones during this very difficult time. Rob was a dedicated supporter of Ridgepost Capital and a valued member of our board, whose guidance, insight, and friendship had a meaningful impact on our company and the people who worked alongside him. He will be greatly missed by all of us. Turning to Q2 earnings, Ridgepost Capital delivered another strong quarter of results as our balanced and durable model continues to perform well amid a fluid operating environment. As a reminder, this was our first full quarter rebranded as Ridgepost Capital, formerly known as P10.

Speaker #3: On behalf of everyone at Ridge Post Capital, we extend our deepest condolences to Rob's family and loved ones during this very difficult time. Rob was a dedicated supporter of Ridge Post Capital and a valued member of our board, whose guidance, insight, and friendship had a meaningful impact on our company and the people who worked alongside him.

Speaker #3: He will be greatly missed by all of us. Now, turning to two Q earnings, Ridge Post Capital delivered another strong quarter of results as our balanced and durable model continues to perform well amid a fluid operating environment.

Speaker #3: As a reminder, this was our first full quarter rebranded as Ridge Post Capital, formerly known as P10. We reached two new milestones in the second quarter, as AUM surpassed $50 billion at period end, up more than $10 billion, or approximately 25% year over year, while fee-paying AUM totaled nearly $35 billion at quarter end, up 19% year over year.

Luke Sarsfield: We reached two new milestones in Q2 as AUM surpassed $50 billion at period end, up more than $10 billion or approximately 25% year-over-year, while fee-paying AUM totaled nearly $35 billion at Q2 end, up 19% year-over-year. Importantly, we continue to experience very strong investment performance across our strategies. In the past, we've aggregated investment performance across our key funds to highlight the underlying strength and differentiated returns we are delivering for all of our stakeholders. We thought it would be helpful to update those numbers and share them with you today. Looking at the net IRRs for funds that are greater than 5 years old, private equity primary funds have averaged 14.1%, while secondary and co-invest funds have averaged 23.1%. Our GP stakes funds at Bonaccord have averaged 18.9%.

Speaker #3: Importantly, we continue to experience very strong investment performance across our strategies. In the past, we've aggregated investment performance across our key funds to highlight the underlying strength and differentiated returns we are delivering for all of our stakeholders.

Speaker #3: We thought it would be helpful to update those numbers and share them with you today. Looking at the net IRRs for funds that are greater than 5 years old, private equity primary funds have averaged 14.1%, while secondary and co-invest funds have averaged 23.1%.

Speaker #3: Our GP stakes funds at Bonaccord have averaged 18.9%. The flagship funds at our venture strategy, TrueBridge, have averaged 18.7%. Our private credit strategies have averaged 10.9%.

Luke Sarsfield: The flagship funds at our venture strategy, TrueBridge, have averaged 18.7%, and our private credit strategies have averaged 10.9%. Moving on to fundraising and deployment activity. Q2 trends remained healthy. We were in the market with about 20 funds, and we raised a meaningful amount of investor commitments across each of our investment verticals. We raised and deployed $1.1 billion of capital in Q2, bringing the trailing 4-quarter total to nearly $5 billion. We are still in the market with multiple funds across most of our strategies, including our GP stakes strategy, Bonaccord, our NAV lending strategy, Hark Capital, our venture capital strategy, TrueBridge, our lower middle market private equity strategies, RCP and Qualitas, as well as our project finance and small business lending strategy, Enhanced Capital. I do want to spend a minute on TrueBridge.

Speaker #3: Now moving on to fundraising and deployment activity. Second quarter trends remained healthy. We were in the market with about 20 funds, and we raised a meaningful amount of investor commitments across each of our investment verticals.

Speaker #3: We raised and deployed $1.1 billion of capital in the quarter, bringing the trailing four-quarter total to nearly $5 billion. And we are still in the market with multiple funds across most of our strategies, including our GP stake strategy, Bonaccord; our NAV lending strategy, HARQ Capital; our venture capital strategy, TrueBridge; our lower middle market private equity strategies, our CP and Qualitas; as well as our project finance and small business lending strategy, Enhanced Capital.

Speaker #3: I do want to spend a minute on TrueBridge. We continue to see strong demand for our venture capital offerings as investors are increasingly focused on the growing dispersion in venture returns.

Luke Sarsfield: We continue to see strong demand for our venture capital offerings as investors are increasingly focused on the growing dispersion in venture returns. This is why manager selection remains so important, and TrueBridge's track record of delivering differentiated performance for investors for nearly 2 decades continues to resonate in the market. To that point, TrueBridge has raised and deployed approximately $1.5 billion in H1 of this year. Bottom line, we believe the trajectory of our fundraising and capital deployment speaks directly to the strong demand we continue to see from LPs, the diversification of offerings across our strategies, as well as our ability to deploy capital consistently and prudently.

Speaker #3: This is why managers' selection remains so important, and TrueBridge's track record of delivering differentiated performance for investors for nearly two decades continues to resonate in the market.

Speaker #3: To that point, TrueBridge has raised and deployed approximately $1.5 billion in the first half of this year. Bottom line, we believe the trajectory of our fundraising and capital deployment speaks directly to the strong demand we continue to see from LPs, the diversification of offerings across our strategies, as well as our ability to deploy capital consistently and prudently.

Speaker #3: In the first half of 2026, we organically raised and deployed over $3 billion of capital, consistent with our expectations heading into the year. Which we had contemplated in our $10 billion fundraising and deployment target for 2026 and 2027.

Luke Sarsfield: In H1 2026, we organically raised and deployed over $3 billion of capital, consistent with our expectations heading into the year, which we had contemplated in our $10 billion fundraising and deployment target for 2026 and 2027. As previously highlighted, underlying growth in firm-wide fee-paying AUM remains strong as year-over-year growth totaled 19% in Q2, giving us comfort and line of sight into achieving our 2029 year-end fee-paying AUM target of $50 billion. To that point, at the time of the Investor Day in September 2024 when we disclosed this target, the implied fee-paying AUM CAGR was approximately 15%. We are pleased to report that our fee-paying AUM CAGR through Q2 2026 stands at 20%. I also want to highlight the growing contribution from direct co-investment in secondary funds or assets that are not in fund-to-fund vehicles.

Speaker #3: As previously highlighted, underlying growth and firm-wide fee-paying AUM remains strong, as year-over-year growth totaled 19% in the second quarter, giving us comfort and line of sight into achieving our 2029 year-end fee-paying AUM target of $50 billion.

Speaker #3: To that point, at the time of the investor day, in September 2024, when we disclosed this target, the implied fee-paying AUM CAGR was approximately 15%.

Speaker #3: We're pleased to report that our fee-paying AUM CAGR through the second quarter of 2026 stands at 20%. I also want to highlight the growing contribution from direct, co-investment, and secondary funds.

Speaker #3: Or assets that are not in fund-to-fund vehicles. Over the past four quarters, these funds have raised and deployed over $2.7 billion of capital, representing over 55% of firm-wide capital raising and deployment activity.

Luke Sarsfield: Over the past four quarters, these funds have raised and deployed over $2.7 billion of capital, representing over 55% of firm-wide capital raising and deployment activity. Moving on, we've talked about this at length in prior quarters, but I think it's important to re-highlight the underlying structure of our business. We believe we have one of the most durable business models in the industry. Specifically, as we operate a capital-light third-party asset management business, our composition of earnings is entirely driven by FRE, with no direct exposure to realizations. Notably, within FRE, approximately 98% of fee-related revenue was generated from management and advisory fees in Q2. There was very little contribution from fee-related performance fees and other non-fee related revenue streams, which tend to be more cyclical in nature.

Speaker #3: Moving on, and we've talked about this at length in prior quarters, but I think it's important to re-highlight the underlying structure of our business.

Speaker #3: We believe we have one of the most durable business models in the industry, specifically as we operate a capital-light, third-party asset management business, and our composition of earnings is entirely driven by FRE, with no direct exposure to realizations.

Speaker #3: Notably, within FRE, approximately 98% of fee-related revenue was generated from management and advisory fees in the second quarter, so there was very little contribution from fee-related performance fees and other non-fee-related revenue streams, which tend to be more cyclical in nature.

Speaker #3: We primarily earn these contractual management fees on committed or deployed AUM that sit within long-dated and capital-committed investment strategies. Meaning our fee-related revenue and fee-related earnings have little exposure to movements in NAV, while just less than 2% of our fee-paying AUM is subject to quarterly redemptions.

Luke Sarsfield: We primarily earn these contractual management fees on committed or deployed AUM that sit within long-dated and capital committed investment strategies. Meaning our fee-related revenue and fee-related earnings have little exposure to movements in NAV, while just less than 2% of our fee-paying AUM is subject to quarterly redemptions. On 22 June, we completed the Stellus acquisition, and we are incredibly excited to have the Stellus team officially a part of Ridgepost Capital. We've spent a reasonable amount of time on our previous two calls reviewing the strategic merits and financial profile of the business and the transaction. I want to spend a moment today on our ongoing integration efforts and what we are doing to bring that strategic vision to life.

Speaker #3: On June 22, we completed the Stellis acquisition, and we are incredibly excited to have the Stellis team officially become part of Ridgepost Capital. We've spent a reasonable amount of time on our previous two calls reviewing the strategic merits and financial profile of the business and the transaction.

Speaker #3: I want to spend a moment today on our ongoing integration efforts and what we are doing to bring that strategic vision to life. You'll remember that we've talked about the opportunity to increase Stellis's origination funnel given the strong fit within our GP sponsor ecosystem focused on the middle and lower middle market.

Luke Sarsfield: You'll remember that we've talked about the opportunity to increase Stellus' origination funnel, given the strong fit within our GP sponsor ecosystem focused on the middle and lower middle market. What are we doing to facilitate that? Well, Stellus' senior originators recently spent time in person with senior professionals at RCP as these teams begin collaborating and identifying ways to do exactly that. Regarding the longer-term origination opportunity with Stellus and RCP, if over time Stellus can capture 10% to 20% of the demand from the equity capital deployed annually within RCP's network of private equity GPs, it could produce an additional $500 million to $1 billion of incremental annual commitments across Stellus.

Speaker #3: So what are we doing to facilitate that? Well, Stellis's senior originators recently spent time in person with senior professionals at RCP as these teams begin collaborating and identifying ways to do exactly that.

Speaker #3: Regarding the longer-term origination opportunity, with Stellis and RCP, if over time Stellis can capture 10 to 20 percent of the demand from the equity capital deployed annually, within RCP's network of private equity GPs, it could produce an additional $500 million to $1 billion of incremental annual commitments across Stellis.

Speaker #3: I would also highlight that the Stellis leadership team recently presented to the entire Ridgepost Capital platform, including all of our investment strategies, to educate teams on their business and strategy, and where there might be incremental opportunities to work together.

Luke Sarsfield: I would also highlight that the Stellus leadership team recently presented to the entire Ridgepost Capital platform, including all of our investment strategies, to educate teams on their business and strategy and where there might be incremental opportunities to work together. In terms of the business, before considering any impact from the RCP origination opportunity, Stellus' origination pipeline is robust and has picked up meaningfully over the last 30 days. In fact, across all of our private credit businesses, origination pipelines are strong. A related point worth highlighting that also indicates we're beginning to see an increase in the velocity of capital returns in the middle and lower middle market. Distributions at RCP's funds, and therefore exit activity, have shown a meaningful pickup year to date.

Speaker #3: In terms of the business, before considering any impact from the RCP origination opportunity, Stellis's origination pipeline is robust and has picked up meaningfully over the last 30 days.

Speaker #3: In fact, across all of our private credit businesses, origination pipelines are strong. A related point worth highlighting that also indicates we're beginning to see an increase in the velocity of capital returns in the middle and lower middle market.

Speaker #3: Distributions at RCP's funds and therefore exit activity have shown a meaningful pickup year to date. Specifically, through July 24th, distributions from RCP funds have more than doubled year over year and are up more than 25% relative to the comparable period in 2024.

Luke Sarsfield: Specifically, through 24 July, distributions from RCP funds have more than doubled year-over-year and are up more than 25% relative to the comparable period in 2024. This clearly has positive implications for distributions to fund investors. It also has positive implications for future fundraising and deployment activity at both RCP as well as our private credit businesses, most notably Stellus, which is consistent with the pipeline activity we previously highlighted. Before turning it over to Amanda, I want to highlight that RCP is celebrating its 25th anniversary this year. In our industry, track record and incumbency are critical. Over the past two and a half decades, RCP has built a highly differentiated franchise supported by long-standing relationships, 25 years of investment data and insights, and a proven ability to deliver attractive returns across market cycles.

Speaker #3: This clearly has positive implications for distributions to fund investors, but it also has positive implications for future fundraising and deployment activity at both RCP as well as our private credit businesses, most notably Stellis, which is consistent with the pipeline activity we've previously highlighted.

Speaker #3: Before turning it over to Amanda, I want to highlight that RCP is celebrating its 25th anniversary this year. In our industry, track record and incumbency are critical.

Speaker #3: Over the past two and a half decades, RCP has built a highly differentiated franchise supported by long-standing relationships, 25 years of investment data and insights, and a proven ability to deliver attractive returns across market cycles.

Speaker #3: It's been a terrific 25 years for RCP, and we're excited about the opportunities ahead as we look toward the next 25 years. With that, I'll turn it over to Amanda.

Luke Sarsfield: It's been a terrific 25 years for RCP. We're excited about the opportunities ahead as we look toward the next 25 years. With that, I'll turn it over to Amanda.

Speaker #1: Thanks, Luke. As highlighted earlier in the call, we delivered strong results again in the second quarter. We generated 24 cents per share of adjusted net income in the period, compared to 23 cents per share in the second quarter of 2025.

Amanda Coussens: Thanks, Luke. As highlighted earlier in the call, we delivered strong results again in Q2. We generated $0.24 per share of adjusted net income in the period, compared to $0.23 per share in Q2 2025. Fee-related earnings totaled $39 million, up 10% year-over-year, while the FRE margin came in at 48%. Fee-related revenue totaled $81 million in the quarter, up 11% year-over-year. Management and advisory fees represented nearly all of fee-related revenue in Q2, totaling $80 million. We believe this revenue mix results in a highly durable and stable earnings profile for Ridgepost Capital. In terms of the fee rate, the average core fee rate, excluding direct and secondary catch-up fees, totaled 100 basis points in Q2, up three basis points from Q1.

Speaker #1: Fee-related earnings totaled $39 million, up 10% year over year, while the FRE margin came in at 48%. Fee-related revenue totaled $81 million in the quarter, up 11% year over year.

Speaker #1: Management and advisory fees represented nearly all of fee-related revenue in Q2, totaling $80 million. We believe this revenue mix results in a highly durable and stable earnings profile for Ridgepost Capital.

Speaker #1: In terms of the fee rate, the average core fee rate, excluding direct and secondary catch-up fees, totaled 100 basis points in the second quarter, up 3 basis points from the first quarter.

Speaker #1: As a reminder, the core fee rate is typically seasonally lower in the first half of the year and seasonally higher in the back half of the year, particularly in the fourth quarter.

Amanda Coussens: As a reminder, the core fee rate is typically seasonally lower in H1 and seasonally higher in H2, particularly in Q4, primarily due to our tax credit business. In terms of the core fee rate for full year 2026, we continue to expect this will total 103 basis points. We also expect direct and secondary catch-up fees will total between $6 and $8 million in 2026, unchanged from our prior expectations. With respect to the outlook for the margin, we continue to expect the FRE margin for full year 2026 will be in the mid-40s. As a reminder on cash interest, we fully utilized our credit revolver to fund the Stellus acquisition at our borrowing rate of 260 plus SOFR.

Speaker #1: Primarily due to our tax credit business. In terms of the core fee rate for full year 2026, we continue to expect this will total $103 basis points, and we also expect direct and secondary catch-up fees will total between 6 and 8 million in 2026, unchanged from our prior expectations.

Speaker #1: With respect to the outlook for the margin, we continue to expect the FRE margin for full year 2026 will be in the mid-40s. As a reminder, on cash interest, we fully utilized our credit revolver to fund the Stellis acquisition at our borrowing rate of 260 plus SOFR.

Speaker #1: I would point out that in June, we expanded our revolving credit facility by $20 million to $195 million, enhancing our financial flexibility. And on cash taxes, we still expect to fully utilize our NOLs by the end of this year.

Amanda Coussens: I would point out that in June, we expanded our revolving credit facility by $20 million to $195 million, enhancing our financial flexibility. On cash taxes, we still expect to fully utilize our NOLs by the end of this year. As we've discussed in the past, we expect our cash tax rate to be in the high single digit to low double-digit range for 2026 and in the mid-teens for 2027. In terms of changes to our share count, we issued 11.8 million shares of partnership units and shares in connection with the Stellus acquisition. As a result of this, at the end of Q2, including partnership units exchangeable for shares, we had approximately 130 million fully diluted shares outstanding.

Speaker #1: As we've discussed in the past, we expect our cash tax rate to be in the high single digits to low double-digit range for 2026, and in the mid-teens for 2027.

Speaker #1: In terms of changes to our share count, we issued 11.8 million shares of partnership units and shares and connection with the Stellis acquisition. As a result of this, at the end of the second quarter, including partnership units exchangeable for shares, we had approximately 130 million fully diluted shares outstanding.

Speaker #1: Regarding capital management, our capital allocation priorities remain balanced, including supporting our ongoing quarterly dividend of 4 cents per share, offsetting the dilution from annual employee stock issuance, managing our leverage, and returning excess capital through share repurchases when valuations are attractive.

Amanda Coussens: Regarding capital management, our capital allocation priorities remain balanced, including supporting our ongoing quarterly dividend of $0.04 per share, offsetting the dilution from annual employee stock issuance, managing our leverage, and returning excess capital through share repurchases when valuations are attractive. Given the recent acquisition of Stellus, some of the near-term focus will be around deleveraging, which coupled with natural growth and cash earnings in the back half of the year, should bring our leverage ratio back in line with our longer-term target in the mid 2x EBITDA by the end of this year versus approximately 2.8x at the end of Q2 pro forma for Stellus. I would point out that we have already paid down $20 million of debt thus far in Q3.

Speaker #1: Given the recent acquisition of Stellis, some of the near-term focus will be around the leveraging, which, coupled with natural growth and cash earnings in the back half of the year, should bring our leverage ratio back in line with our longer-term target in the mid-2 times EBITDA by the end of this year, versus approximately 2.8 times at the end of the second quarter, pro forma for Stellis.

Speaker #1: And I would point out that we have already paid down $20 million of debt thus far in the third quarter. As is always the case, we will balance other capital uses with share repurchases, as we view this as an efficient and accretive way to return excess capital to shareholders, particularly if the stock continues to trade at what we view to be dislocated valuations.

Amanda Coussens: As is always the case, we will balance other capital uses with share repurchases, as we view this as an efficient and accretive way to return excess capital to shareholders, particularly if the stock continues to trade at what we view to be dislocated valuations. One other topic I want to discuss before turning it back to Luke for closing remarks. In close collaboration with our Chief Information Officer, Mike Goodwin, we're spending a meaningful amount of our time on AI and technology. We're exploring how Ridgepost Capital and all of our teams can leverage AI and technology in order to create operational efficiencies, as well as to drive more informed decision-making, which we think will ultimately drive even better outcomes for all of our stakeholders.

Speaker #1: One other topic I want to discuss before turning it back to Luke for closing remarks. In close collaboration with our chief information officer, Mike Goodwin, we're spending a meaningful amount of our time on AI and technology.

Speaker #1: We're exploring how Ridgepost Capital and all of our teams can leverage AI and technology in order to create operational efficiencies, as well as to drive more informed decision-making, which we think will ultimately drive even better outcomes for all of our stakeholders.

Speaker #1: We see three key opportunities emerging as they relate to technology, AI, and Ridgepost Capital, while we balance internal and external costs, including token usage across the company.

Amanda Coussens: We see three key opportunities emerging as it relates to technology, AI, and Ridgepost Capital while we balance internal and external costs, including token usage across the company. Operations and automation, enhanced investment capabilities, and collaboration. I won't go into all the specifics for each of these buckets on the call today, but I do want to share a couple of tangible examples of the early progress we're seeing. The first area is reviewing NDAs. We've reduced the time it takes to review an NDA from roughly 60 minutes to about 5 to 10. For some perspective, we review at least a few thousand NDAs a year, implying that we'll save roughly several thousand hours per year on just NDAs alone. That's quite meaningful in thinking about the time and resources needed to review these documents previously.

Speaker #1: Operations and automation, enhanced investment capabilities, and collaboration. I won't go into all the specifics for each of these buckets on the call today, but I do want to share a couple of tangible examples of the early progress we're seeing.

Speaker #1: The first area is reviewing NDAs. We've reduced the time it takes to review an NDA from roughly 60 minutes to about 5 to 10.

Speaker #1: For some perspective, we review at least a few thousand NDAs a year, implying that we'll save roughly several thousand hours per year on just NDAs alone. That's quite meaningful when thinking about the time and resources needed to review these documents previously.

Speaker #1: Second, at our private equity fund-of-funds business, RCP, the firm is leveraging AI and technology to significantly streamline the production of payer sheets and GP Scout profiles.

Amanda Coussens: Second, at our private equity fund of funds business, RCP, the firm is leveraging AI and technology to significantly streamline the production of GPScout and GPScout profiles. This process was previously done by human beings and would take about 1 to 2 days to complete. By leveraging technology and AI, this process now only takes roughly 1 hour, and importantly, this human capital has been redeployed across other areas of the business. Third, collaboration across all of our strategies has never been higher, and we think our AI and technology initiatives have been a key driver of this. We recently started hosting firm-wide weekly AI drop-in open hours so our employees can ask questions, get help with AI prompts, and it's also a great way for all of our teams to collaborate and share ideas.

Speaker #1: This process was previously done by human beings and would take about 1 to 2 days to complete. By leveraging technology and AI, this process now only takes roughly 1 hour, and importantly, this human capital has been redeployed across other areas of the business.

Speaker #1: Third, collaboration across all of our strategies has never been higher, and we think our AI and technology initiatives have been a key driver of this.

Speaker #1: We recently started hosting firm-wide weekly AI drop-in open hours, so our employees can ask questions, get help with AI prompts, and it's also a great way for all of our teams to collaborate and share ideas.

Speaker #1: These are only three examples of where we're experiencing real benefits and efficiencies across the business, but there's a long list of others currently underway.

Amanda Coussens: These are only 3 examples of where we're experiencing real benefits and efficiencies across the business, but there's a long list of others currently underway. There's certainly been real-time cost savings associated with these early initiatives, and the incremental margin potential longer term is meaningful. We plan to invest some of this near-term savings back into other initiatives to make sure we're staying ahead of the curve longer term. Many of our strategies have decades worth of data, which is valuable in and of itself. We also have the view that the real value and longer-term benefits will come from prudently leveraging these data sets across the entire organization. Bottom line, we think we're only in the top of the second inning for AI and related adoption, and we look forward to sharing more with you on our progress in the coming quarters.

Speaker #1: There's certainly been real-time cost savings associated with these early initiatives, and the incremental margin potential longer term is meaningful. Though we plan to invest some of this near-term savings back into other initiatives to make sure we're staying ahead of the curve longer term.

Speaker #1: Many of our strategies have decades' worth of data, which is valuable in and of itself, but we also have the view that the real value and longer-term benefits will come from prudently leveraging these datasets across the entire organization.

Speaker #1: Bottom line, we think we're only in the top of the second ending for AI and related adoption, and we look forward to sharing more with you on our progress in the coming quarters.

Speaker #1: With that, I'll turn it back to Luke for a few closing comments before we open it up for Q&A.

Amanda Coussens: With that, I'll turn it back to Luke for a few closing comments before we open it up for Q&A.

Speaker #2: Thanks, Amanda. Before we open it up to questions, I want to share a few closing remarks. Our business is performing exceptionally well and we have strong momentum heading into the back half of the year.

Luke Sarsfield: Thanks, Amanda. Before we open it up to questions, I want to share a few closing remarks. Our business is performing exceptionally well, and we have strong momentum heading into the back half of the year. We are pleased to have Stellus formally on board at Ridgepost Capital, and the integration process is well underway with clear opportunities to collaborate to drive even better outcomes for our stakeholders. As we've talked about in the past, our top priority remains delivering differentiated returns for our LPs, as this is by far the most important driver of the flywheel longer term. Beyond that, we remain laser-focused on controlling what we can control across the business, including delivering profitable and accretive long-term growth. In terms of the stock, we believe the valuation today is incredibly dislocated relative to our view of fair value, specifically compared to the underlying fundamentals.

Speaker #2: We are pleased to have Stellis formally on board at Ridgepost Capital and the integration process is well underway, with clear opportunities to collaborate to drive even better outcomes for our stakeholders.

Speaker #2: As we've discussed in the past, our top priority remains delivering differentiated returns for our LPs, as this is by far the most important driver of the flywheel over the long term.

Speaker #2: Beyond that, we remain laser-focused on controlling what we can control across the business, including delivering profitable and accretive long-term growth. In terms of the stock, we believe the valuation today is incredibly dislocated relative to our view of fair value, specifically compared to the underlying fundamentals.

Speaker #2: Our business has historically compounded in the mid-teens annually, and we view Ridgepost Capital as a pure-play, capital-light, third-party alternative asset manager. Importantly, as previously mentioned, the vast majority of our revenue is driven by long-dated, contractually committed management fees creating an incredibly stable and durable earnings stream.

Luke Sarsfield: Our business has historically compounded in the mid-teens annually, and we view Ridgepost Capital as a pure-play, capital-light, third-party alternative asset manager. Importantly, as previously mentioned, the vast majority of our revenue is driven by long-dated, contractually committed management fees, creating an incredibly stable and durable earnings stream. We see strong downside protection with the potential for significant upside over time. Thank you for your time today. I will now pass the call over to the operator to begin the Q&A session.

Speaker #2: So, we see strong downside protection with the potential for significant upside over time. Thank you for your time today. I'll now pass the call over to the operator to begin the Q&A session.

Speaker #3: Thank you. As a reminder to ask a question, you will need to press star 11 on your telephone. To remove yourself from the queue, you may press star 11 again.

Operator: Thank you. As a reminder, to ask a question, you will need to press star one one on your telephone. To remove yourself from the queue, you may press star one one again. Please limit yourself to one question and one follow-up to allow everyone the opportunity to participate. Please stand by while we compile the Q&A roster. Our first question comes from the line of Michael Cyprys of Morgan Stanley. Your line is open, Michael.

Speaker #3: Please limit yourself to one question and one follow-up to allow everyone the opportunity to participate. Please stand by while we compile the Q&A roster.

Speaker #3: Our first question. Comes from the line of Michael Cypress. Up Morgan Stanley. Your line is open, Michael.

Operator: Our first question comes from the line of Michael Cyprys of Morgan Stanley. Your line is open, Michael.

Joseph Maiullo: Hey, good morning. It's Joe Tamilon from Mike Cyprys. Thank you for taking my question. I think you guys mentioned $500 million to $1 billion of incremental commitments across Stellus by capturing roughly 10% to 20% of the equity capital from the GPs you already serve in the marketplace. Just wondering if you could talk about the steps you will need to take to really drive that strategy. What sort of timeframe do you think is really realistic to achieve that? I guess, what's the baseline of where that is today, as I imagine Stellus already serves some of those GPs. Thank you.

Joe Tumillo: Hey, good morning. It's Joe Tamilon from Mike Cyprys. Thank you for taking my question. I think you guys mentioned $500 million to $1 billion of incremental commitments across Stellus by capturing roughly 10% to 20% of the equity capital from the GPs you already serve in the marketplace. Just wondering if you could talk about the steps you will need to take to really drive that strategy. What sort of timeframe do you think is really realistic to achieve that? I guess, what's the baseline of where that is today, as I imagine Stellus already serves some of those GPs. Thank you.

Speaker #4: Hey, good morning. It's Joe Tamilawan from Mike Cypress. Thank you for taking my question. I think you guys mentioned 500 million to 1 billion of incremental commitments across Stellis by capturing roughly 10 to 20 percent of the equity capital from the GPs.

Speaker #4: You're already serving the marketplace. Just wondering if you could talk about the steps you'll need to take to kind of really drive that strategy.

Speaker #4: What sort of time frame do you think is really realistic to kind of achieve that? And I guess, what's the baseline of where that is today?

Speaker #4: As I imagine Stellis already serves some of those GPs. Thank you.

Luke Sarsfield: Hey, Joe, it's Luke. Thanks for the question and good morning. I would say a couple things. First thing I think it is important to note is that we closed the transaction about six weeks ago now. While we think there's a big opportunity in front of us, and we have spent a lot of time prior to closing the deal, getting organized around that, we are very early days on this. The second thing I would note is we always highlighted that we thought one of the really compelling attributes of this transaction was the opportunity to really broaden that origination funnel at Stellus. We thought we were in a unique and differentiated position to do that, given our network of relationships, and in particular, the strength of that GP ecosystem in the middle and lower middle market at RCP.

Speaker #5: Hey, Joe. It's Luke. Thanks for the question and good morning. I'd say a couple of things. So first thing, I think it is important to note is that we closed the transaction about six weeks ago now.

Speaker #5: And so, while we think there's a big opportunity in front of us, and we have spent a lot of time prior to closing the deal getting organized around that, we are very, very early days on this.

Speaker #5: The second thing I would note is we always highlighted that we thought one of the really compelling attributes of this transaction was the opportunity to really broaden that origination funnel at Stellis.

Speaker #5: And we thought we were in a unique and differentiated position to do that, given our network of relationships and, in particular, the strength of that GP ecosystem in the middle and lower middle market at RCP.

Speaker #5: RCP, as I talked about, celebrating 25 years, they have an incredible track record, incredible lineage, and just a deep set of both historical, ongoing, and frankly, prospective relationships that we think we can open up.

Luke Sarsfield: RCP, as I talked about, celebrating 25 years, they have an incredible track record, incredible lineage, and just a deep set of both historical, ongoing, and frankly, prospective relationships that we think we can open up. The way we came to that is we looked at that number we used is we looked at some of the historical and recent historical deployment trends over time. Those sponsors within that RCP ecosystem deploy on average in a given year about $5 billion. Right? If you take 10% to 20% of that's how we're getting to the $500 to $1 billion of incremental origination capacity at Stellus. The other thing I would note is we think there's a lot of benefit to expanding the top of the funnel, and one of those key benefits is the opportunity to have, as I would call it, more shots on goal.

Speaker #5: The way we kind of came to that is we looked at that number we used is we looked at some of the historical and recent historical deployment trends over time, and those sponsors within that RCP ecosystem deploy on average in a given year about 5 billion dollars, right?

Speaker #5: And so if you take 10 to 20 percent of that, that's how we're getting to the 500 to a billion dollars of incremental origination capacity at Stellis.

Speaker #5: The other thing I would note is we think there's a lot of benefit to expanding the top of the funnel, and one of those key benefits is the opportunity to have, as I would call it, more shots on goal.

Luke Sarsfield: The more shots on goal you have, the more opportunities you have, the more selective you can be in capital deployment. Trust me, the Stellus team is already world-class at this and plenty selective. The more opportunities you have, the better I think that investment profile is going to look over time. We are really focused on this. As I mentioned, we've already had the teams together. They're having weekly, if not daily, calls. We're going to create a lot of opportunities for dialogue, for integration. We've really tried to build the bonds human to human, person to person. We're spending a lot of time acting collectively and thinking about how we can do this. Look, realistically though, to really get to those full numbers, it's probably going to take a period of years.

Speaker #5: The more shots on goal you have, the more opportunities you have. The more selective you can be in capital deployment—and trust me, the Stellis team is already world-class at this and plenty selective.

Speaker #5: But the more opportunities you have, the better, I think, that investment profile is going to look over time. And so we are really, really focused on this.

Speaker #5: As I mentioned, we've already had the teams together. They're having weekly, if not daily, calls. We're going to create a lot of opportunities for dialogue for integration.

Speaker #5: We've really tried to build bonds human to human, person to person. We're spending a lot of time acting collectively and thinking about how we can do this.

Speaker #5: And look, realistically, though, to really get to those full numbers, it's probably going to take a period of years. But that doesn't mean we won't see incremental progress in that interval before that.

Luke Sarsfield: That doesn't mean we won't see incremental progress in that interval before that. I think we've already started. There's already been some dialogue around some obvious near-term transaction opportunities that we think we can collectively get after. As a takeaway, I would say we're super excited around what that can look like in the near, intermediate, and long term.

Speaker #5: I think we've already started. There's already been some dialogue around some obvious near-term transaction opportunities that we think we can collectively get after. And as kind of the takeaway, I would say we're super excited around what that can look like in the near, intermediate, and long term.

Speaker #4: Great, thank you. And I guess, real quick, as a follow-up—completely hear you, the focus is on deleveraging and opportunistic share repurchases. But if we kind of think about capital allocation a few years out here...

Joseph Maiullo: Great. Thank you. I guess real quick as a follow-up, I completely hear you, the focus is on deleveraging and opportunistic share repurchases, we think about capital allocation a few years out here. I'm just thinking in terms of the M&A environment, where are some things that you know could be potentially interesting or maybe worded differently is where do you see potential opportunities that are additive to the RCP platform in terms of different kind of products or strategies? Thank you.

Joe Tumillo: Great. Thank you. I guess real quick as a follow-up, I completely hear you, the focus is on deleveraging and opportunistic share repurchases, we think about capital allocation a few years out here. I'm just thinking in terms of the M&A environment, where are some things that you know could be potentially interesting or maybe worded differently is where do you see potential opportunities that are additive to the RCP platform in terms of different kind of products or strategies? Thank you.

Speaker #4: I'm just kind of thinking in terms of the M&A environment, where are some things that could be potentially interesting or maybe worded differently as where do you see potential opportunities that are additive to the RPC platform in terms of different kind of products or strategies?

Speaker #4: Thank you.

Speaker #5: It's a great question. I'm going to let RJ, who's here, take that question. So RJ, over to you.

Luke Sarsfield: It's a great question. I'm going to let RJ, who's here, take that question. RJ, over to you.

Arjay Jensen: Yeah. Great. Thank you, Luke. Thank you for the question. Look, I think it's similar to what you've heard from us in the past. Continue to focus on geographic expansion where we have strategies. Thinking about Europe further. If you think about private credit in Europe, we think that could be the analog of Stellus in the US. If you think about more regular way for US-oriented strategies in private credit, I'd say we're very focused on asset-backed platforms. Then we talk a lot about real assets as well, both infrastructure and real estate. I think we're spending time in all areas.

Speaker #6: Yeah, great. Thank you, Luke. And thank you for the question. Look, I think it's similar to what you've heard from us in the past.

Speaker #6: Continue to focus on geographic expansion where we have strategies. So thinking about Europe further. If you think about private credit in Europe, we think that could be kind of the analog of Stellis in the US.

Speaker #6: If you think about more regular way kind of where US-oriented strategies in private credit, I'd say we're very focused on asset-backed platforms. And then we talk a lot about real assets as well, both infrastructure and real estate.

Speaker #6: So I think we're spending time in all areas. I would say while activity was a little bit slower in terms of new process launches the first half of the year, that feels like it's really increased.

Arjay Jensen: I would say, while activity was a little bit slower in terms of new process launches the H1 of the year, that feels like it's really increased, and I think you're going to see more activity, more announcements as we get into the H2 of the year.

Speaker #6: And I think you're going to see more activity and more announcements as we get into the second half of the year.

Speaker #4: Great. Thank you.

Amanda Coussens: Okay. Thank you.

Joe Tumillo: Okay. Thank you.

Speaker #3: All right. Thank you. Our next question. Comes from the line of Benjamin Budish. Barclays. Please go ahead, Benjamin.

Operator: All right. Thank you. Our next question comes from the line of Benjamin Budish of Barclays. Please go ahead, Benjamin.

Benjamin Budish: Hi. Good morning, and thanks for taking my questions. Maybe first another follow-up on Stellus. Curious, Luke, you reiterated your $10 billion fundraising and deployment expectation for 2026, 2027. What does Stellus do to that number? What's been the historical fundraising cadence, and how do we think about the ongoing contribution? Just in the P&L, I think you had maybe a week or two of Stellus in the quarter, so you reiterated your full-year FRE margin guidance. Any other little modeling tidbits, maybe for Amanda, you can help with just for the back half? What does the comp ratio look like? How else should we be calibrating expectations with that now fully in the business?

Speaker #4: Hi, good morning, and thanks for taking my questions. Maybe first, another follow-up on Stellis. Curious, Luke, you kind of reiterated your $10 billion fundraising and deployment expectation for '26, '27.

Speaker #4: What does Stellis do to that number? What's kind of been the historical fundraising cadence, and how do we think about the ongoing contribution? And then just in the P&L, I think you had maybe a week or two of Stellis in the quarter.

Speaker #4: And so you reiterated your full year FOE margin guidance. But any other little modeling tidbits? Maybe for Amanda, you can help with just for the back half.

Speaker #4: What does the comp ratio look like? How else should it be calibrating expectations with that now fully in the business?

Speaker #5: Great question. I'll start with the fundraising question, and that dynamic, and then I'll turn it to Amanda to kind of give a few tidbits, as you said, on the margin guidance.

Luke Sarsfield: Great question. I'll start with the fundraising question and that dynamic, then I'll turn it to Amanda to give a few tidbits, as you said, on the margin guidance. You're right, by the way, we closed it on 22 June, so we had basically one week of Stellus in the quarter here, all things considered. On the fundraising, look, we have real long-term optimism in terms of the Stellus platform, in terms of what we can do collectively and what Stellus can continue to do individually. Though the one thing that I would generally remind folks is obviously we continue to raise a lot of our capital, not all of our capital, but a lot of our capital in committed closed-end vehicles. When those vehicles are in the market, there's obviously the opportunity to then have a step function increase in that capital.

Speaker #5: And to your right, by the way, we closed it on June 22nd. So we had basically one week of Stellis in the quarter here, all things considered.

Speaker #5: So on the fundraising, look, we have real long-term optimism in terms of the Stellis platform, in terms of what we can do collectively, and what Stellis can continue to do individually.

Speaker #5: Though the one thing that I would generally remind folks is, obviously, we continue to raise a lot of our capital, not all of our capital, but a lot of our capital, and committed closed-end vehicles.

Speaker #5: And so when those vehicles are in the market, there's obviously the opportunity to then have a step-function increase in that capital. But those vehicles are not always in the market.

Luke Sarsfield: Those vehicles are not always in the market. I would just recall that Stellus itself has recently just completed, and they announced publicly, a fundraising cycle where they announced the closure of their Stellus Capital Fund IV, plus a bunch of SMAs and related accounts, and the aggregate amount that they said publicly that they raised through that cycle was $1.5 billion in aggregate. They've now raised that capital, and I would say right now, the good news is they've got a lot of dry powder, and their focus is really on deployment, and deployment against accretive, well-statured, well-tenured investment opportunities. They're going to focus primarily on that. I think as that capital gets deployed, presumably we'll see some, what I would call modest benefit from that.

Speaker #5: I would just recall that Stellis itself has recently, just completed and they announced publicly a fundraising cycle where they announced the closure of their Stellis capital fund four, plus a bunch of SMAs and related accounts.

Speaker #5: And the aggregate amount, as they said publicly, that they raised through that cycle was 1.5 billion dollars in aggregate. And so they've now raised that capital.

Speaker #5: And I would say right now, the good news is they've got a lot of dry powder, and their focus is really on deployment and deployment against a creative well-statured, well-tenured investment opportunities.

Speaker #5: And so they're going to focus primarily on that. And so I think as that capital gets deployed, presumably we'll see some, what I would call, modest benefit from that.

Speaker #5: But I think as long as they are in the current cycle, it's going to be relatively modest in the overall scheme of what we're doing.

Luke Sarsfield: I think, as long as they are in the current cycle, it's going to be relatively modest in the overall scheme of what we're doing. We'll obviously report out more on that as we go. If we can increase that origination funnel, as we've said we can, they'll have the opportunity, and we'll have the opportunity collectively to be back in the market for another fundraising cycle, again, which they can then gainfully deploy. That, obviously when we get there, will create the opportunity to continue to grow Stellus' fee-paying AUM and AUM. Given that they just raised capital and closed on it in the last call it three to six months, the focus here is really going to be primarily on deployment in the near to immediate term. Amanda, I'll turn it to you on the margin.

Speaker #5: We'll obviously report out more on that as we go. And then if we can increase that origination funnel, as we've said we can, they'll have the opportunity and we'll have the opportunity collectively to be back in the market for another fundraising cycle, again, which they can then gainfully deploy.

Speaker #5: And that, obviously, when we get there, will create the opportunity to continue to grow Stellis's fee-paying AUM and overall AUM. But given that they just raised capital and closed on it in the last, kind of, call it three to six months, the focus here is really going to be primarily on deployment in the near to intermediate term.

Speaker #5: Amanda, I'll turn it to you on the margin.

Amanda Coussens: Thank you, Ben, for the question. I'll make a couple of comments on margin. There were a few factors that increased our margin from last quarter, including an increase in our fee rates. We had steady cash comp costs with lower professional fees in the quarter. Professional fees have been historically higher during Q1. However, we are still expecting a mid-40s margin for the year, given anticipated placement agent costs and fundraising related hires in the back half of the year. Generally speaking, Stellus' margin profile is similar to ours.

Speaker #2: Thank you, Ben, for the question. So I'll make a couple of comments on margins. So there were a few factors that increased our margin from last quarter, including an increase in our fee rate.

Speaker #2: We have steady cash count costs with lower professional fees in the quarter. Professional fees have been historically higher during the first quarter. However, we are still expecting a mid-40s margin for the year, given anticipated placement agent costs and fundraising-related hires in the back half of the year.

Speaker #2: And generally speaking, Stellis's margin profile is similar to ours.

Speaker #4: Okay. Thank you both. That was all for me.

Benjamin Budish: Okay. Thank you both. That was all for me.

Speaker #3: Our next question. Comes from the line of Chris Katowski.

Operator: Our next question comes from the line of Chris Kotowski.

Speaker #7: Good morning. Thanks for taking the question. You mentioned that you currently had 20 funds in the market. And just kind of looking at the fund tables in the slide deck, it looked like it was pretty well spread out across a lot of 22, 24, 25 vintage funds.

Chris Kotowski: Good morning.

Operator: Good morning.

Chris Kotowski: Thanks for taking the question. You mentioned that you currently had 20 funds in the market. Just looking at the fund tables in the slide deck, it looked like it was pretty well spread out across a lot of 2022, 2024, 2025 vintage funds. I was wondering if there are any planned flagship fund launches between now and year-end, or is that mainly a 2027 event?

Speaker #7: And I was wondering if are there any planned flagship fund launches between now and year-end, or is that mainly a 2027 event?

Speaker #5: Well, we are that's a great question, Chris. So we're in the market, as we've said, at any point in time would probably between 15 and 20 funds.

Luke Sarsfield: Well, that's a great question, Chris. We're in the market, as we've said, at any point in time with probably between 15 and 20 funds. I think during the quarter, we were in with about 20 funds. A couple of those closed. I think we're now high teens. There probably will be some more launches as we go. I would say at any point in time, there are likely to be multiple flagship funds in the market. Just in terms of where we are right now, in terms of which funds are in the market, Bonaccord is in the market with their flagship fund 3, BCP III. That launched at the beginning of the year, and the fundraising period will go into 2027. Similarly, Hark Capital is in the market with their flagship fund 5.

Speaker #5: I think at the end of the during the quarter, we ran with about 20 funds, a couple of those closed. I think we're now high teens.

Speaker #5: They're probably will be some more launches as we go. But I would say at any point in time, there are likely to be multiple flagship funds in the market.

Speaker #5: And so just kind of in terms of where we are right now, in terms of which funds are in the market, Bonaccord is in the market with their flagship fund three, VCP three.

Speaker #5: That launched at the beginning of the year, and the fundraising period will go into 2027. Similarly, HARQ is in the market with their flagship Fund V.

Speaker #5: That launched, again, at the beginning of the year. And that will also go into 2027. At TrueBridge, as I mentioned, we're seeing a lot of uptake.

Luke Sarsfield: That launched again at the beginning of the year, that will also go into 2027. At TrueBridge, as I mentioned, we're seeing a lot of uptake. They are and continue to be in the market with their flagship fund as well as some other funds. If you're focusing on flagship, they're in the market with their flagship fund, and they continue to be. I think as you are well aware, having long been a student of Ridgepost Capital, at RCP, they raise a flagship fund annually. They literally just closed at the end of the quarter, their flagship fund 20, then they immediately launched their flagship fund 21, RCP 21. They are back in the market with flagship fund 21. At Enhanced, they've converted largely into an evergreen format, that will now be a perpetually offered fund.

Speaker #5: They are and continue to be in the market with their flagship fund, as well as some other funds. But if you're focusing on flagship, they're in the market with their flagship fund.

Speaker #5: And they continue to be. I think as you are well aware, having long been a student of Ridge Post Capital, at RCP, they raise a flagship fund annually.

Speaker #5: And so they literally just closed at the end of the quarter. Their flagship fund 20. And then they immediately launched their flagship fund 21, RCP 21.

Speaker #5: And so they are back in the market with flagship fund 21. At Enhanced, they converted largely into an evergreen format. And so that will now be a perpetually offered fund.

Speaker #5: And so they're going to continue to be in the market with that. And I would think about that from an enhanced perspective as their flagship offering.

Luke Sarsfield: They're going to continue to be in the market with that. I would think about that from an Enhanced perspective as their flagship offering. Even as we speak, I think that was probably four or five things I just mentioned that we're in the market with. We do think we'll see more fund launches in the back half of the year, even more as we get into 2027. I would say the general expectation ought to be, we're in that 15 to 20 range of things in the market. Maybe even it could tick above 20 at different times. I would think of that as kind of a perpetual number at some level. Other things will be raised, and so on and so forth.

Speaker #5: So even as we speak, I think that was probably four or five things I just mentioned that we're in the market with. We do think we'll see more fund launches in the back half of the year, and then even more as we get into '27.

Speaker #5: And so I would say the general expectation ought to be we're in that 15 to 20 range of things in the market, maybe even it could take above 20 at different times.

Speaker #5: But I would think of that as kind of a perpetual number at some level. If things come off, other things will be raised and so on and so forth.

Speaker #5: And then obviously, with the Stellis acquisition, we're always going to be in the market in a sense with the various BDC vehicles and Stellis.

Luke Sarsfield: Obviously, with the Stellus acquisition, we're always going to be in the market, in a sense, with the various BDC vehicles from Stellus.

Speaker #7: Yeah. And just as a follow-up, you mentioned that the Stellis fund four closed with a billion and a half in commitments and in sidecars, I guess.

Chris Kotowski: Yeah. Just as a follow-up, you mentioned that the Stellus Fund IV closed with a billion and a half in commitments and in sidecars, I guess.

Luke Sarsfield: Yeah.

Speaker #7: In the fund table, we see $448 million. So will that just increase as the fund deploys?

Chris Kotowski: In the fund table, we see $448 million. Will that just increase as the fund deploys?

Speaker #5: Yes. So remember, most of our strategies historically have charged on committed capital but credit strategies is a general matter charge on deployed capital. For us, historically, that was really only HARQ that charged on deployed capital virtually everything else charged on committed capital.

Luke Sarsfield: Yes. Remember, most of our strategies historically have charged on committed capital. Credit strategies, as a general matter, charge on deployed capital. For us, historically, that was really only Hark that charged on deployed capital. Virtually everything else charged on committed capital. Stellus will now go into that category of things that charge on deployed capital. As we see those deployment trends go up, the amount of capital deployed will go up, to your point, Chris.

Speaker #5: Stellis will now go into that category. Of things that charge on deployed capital. And as we see those deployment trends go up, the amount of capital deployed will go up to your point, Chris.

Speaker #7: Okay, great. That's it for me. Thank you.

Chris Kotowski: Okay, great. That's it for me. Thank you.

Speaker #3: Thank you. I would now like to turn the conference back to Luke Sarsfield for closing remarks. Sure.

Operator: Thank you. I would now like to turn the conference back to Luke Sarsfield for closing remarks. Sir?

Speaker #5: Thank you all for your time today and your continued support. Ridge Post Capital remains extremely well positioned in the current environment, given our committed fee-paying AUM base, and our earnings stream that's almost entirely driven by management fees.

Luke Sarsfield: Thank you all for your time today and your continued support. Ridgepost Capital remains extremely well-positioned in the current environment, given our committed fee-paying AUM base and our earnings stream that's almost entirely driven by management fees. Please reach out to our team with any additional follow-up questions, and we look very much forward to updating you on our Q3 results in early November. Thank you for joining us today, and have a great day.

Speaker #5: Please reach out to our team with any additional follow-up questions, and we look very much forward to updating you in our third quarter results and early November.

Speaker #5: Thank you for joining us today, and have a great day.

Operator: This concludes today's conference call. Thank you for participating. You may now disconnect.

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