Stepstone Group Inc. · NASDAQ:STEP
Stepstone — Investor Presentation (February 2026)
83 slides from Stepstone's investor presentation, February 2026
Slide 1: Private equity house views 2026
Private equity house views 2026 February 2026 20260225-5248510-16562365
Slide 2: Notes
NOTES This document is for informational purposes and is meant only to provide a broad overview for discussion purposes. Prospective investors should inform themselves and take appropriate advice as to any applicable legal requirements This document does not constitute an offer to sell, a solicitati
Slide 3: Global macroeconomic indicators
Global macroeconomic indicators 20260225-5248510-16562365
Slide 4: 2026 macroeconomic outlook
2026 macroeconomic outlook Uncertainty surrounding inflation, economic growth, and interest rates remains high Short term Long term While euro-zone inflation is currently at target, progress in the US and UK has stalled, Demographics and trend toward deglobalization could prove inflationary. and inf
Slide 5: Economic growth and inflation forecasts
Economic growth and inflation forecasts Trade policy has shifted consensus expectations toward slower growth and higher inflation in most major economies Real GDP growth projections Inflation projections 30% 12% 10% 20% 8% 10% 6% 0% 4% -10% 2% -20% 0% US EZ UK -2% US EZ UK -30% Dec-21 Dec-20 Apr-21
Slide 6: Regional growth expectations
Regional growth expectations Growth expectations differ across regions led by APAC but remain relatively weak in Western Europe. GDP growth revisons1 5% Real GDP growth expectations in the US were initially revised down in the beginning of 2025 but have steadily 4% Europe economic growth could sligh
Slide 7: Default rates in direct lending and BSL
Default rates in direct lending and BSL US direct lending default rates Broadly syndicated loan markets LTM default rates (based on Middle-Market CLOs data) LTM default rates (based on issuer) 9% 18% Narrow & Selective Defaults Narrow Defaults 8% 16% 7% 14% US Europe US Incl. Distressed 6% 12% 5% 10
Slide 8: Short term rates coming down at different pace
Short term rates coming down at different pace Rate hikes have helped to bring inflation down. While most central banks have now shifted towards easing, inflationary pressures will challenge both the timing and extent of rate cuts Short-term interest rates Yield curves 6% 6% 5% 5% 4% 4% 3% 3% 2% 2%
Slide 9: What happens to longer term rates?
What happens to longer term rates? Higher 10-year real rates and less ample reserves from central banks could leave financial conditions tighter than in the past decade 10y real yield1 Central bank balance sheets2 % of GDP 3% 140% 2% 120% 100% 1% 80% 0% 60% -1% 40% -2% 20% 0% -3% Sep-21 Sep-20 Sep-2
Slide 10: Input cost trends
Input cost trends Supply chains have normalized, but geopolitics and trade barriers pose upside risk to inflation Supply chain pressure1 Commodity price change2 Index levels In % 130% 5 Disrupted relative to mean 110% 4 90% 3 70% 2 50% 1 30% 0 10% -10% -1 -30% -2 Low pressure relative to mean Dec-20
Slide 11: Tariffs – current situation
Tariffs – current situation Currently implemented tariffs increased the average effective tariff rate from 2.3% in 2024 to ~16% by the end of October 2025. This continues to be highly volatile. Certain sectors sensitive to discretionary spending (apparel, home goods, etc) or global supply chains (au
Slide 12: Tariff impact by region/sectors
Tariff impact by region/sectors Topics Comments - US companies are most likely affected by rising input costs as well as lower revenues Differentiated regional impact - Trading partners affected via lower revenues - Small and middle-market companies are less reliant on global supply chains and thus
Slide 13: Private equity market trends
Private equity market trends 20260225-5248510-16562365
Slide 14: The private equity landscape
The private equity landscape 1 2 3 Sponsor M&A rebound driven by Distributions are up but backlog remains Public/private returns large transactions The M&A pause post US tariff Exit activity also picked up momentum in Over the long run, median private equity has announcements in April 2025 began to
Slide 15: 2025 fundraising fell short of prior-year levels
2025 fundraising fell short of prior-year levels Global buyout and VC fundraising activity declined in 2025, with longer fundraising timelines and fewer GPs holding final closes. LPs are concentrating capital with larger established GPs and strong performing middle-market GPs. GPs with strong recent
Slide 16: Most of PE exposure growth is in NAV
Most of PE exposure growth is in NAV Dry powder as % of NAV has come down over the years as sponsors continue to put money to work. Significant levels of NAV creates substantial secondary buying opportunities. Continued high levels of dry powder, some of which is aging, supports ongoing recovery in
Slide 17: PE new deal activity increased YoY driven by larger deals
PE new deal activity increased YoY driven by larger deals PE deal value and deal count increased 23% and 6% in 2025. Large transactions drove strong recovery in late 2025 Large-scale transactions in 2H 2025: - Electronic Arts take-private ($55B) – by SWF, Affinity Partners (Jared Kushner), Silver La
Slide 18: Healthy lending activity in 2025 despite tariff impact
Healthy lending activity in 2025 despite tariff impact Total lending volumes fell in 2025 as loan repricings tapered from the 2024 surge, when the credit markets reopened. Origination for new deals posted a modest 3% increase versus the prior year. Lending activity1 Leveraged loan maturity profile2
Slide 19: Spreads in direct lending compressing quickly
400 100 300 500 0 700 600 900 200 800 1,000 Feb-16 May-16 Aug-16 Nov-16 Feb-17 May-17 Aug-17 Nov-17 Feb-18 May-18 Aug-18 In bps, new deals 180-days rolling Nov-18 Feb-19 May-19 Aug-19 Nov-19 Feb-20 May-20 Aug-20 Nov-20 Feb-21 May-21 Aug-21 Median US first-lien contractual spread Source: Kroll StepSt
Slide 20: Buyout valuation environment
Buyout valuation environment PE buyout multiples YTD in 2025 increased, driven by larger market transactions in sectors with lower direct exposure to tariff- related volatility, such as software and healthcare services. However, there is a tale of two cities. Since 2022, the spread between value/pre
Slide 21: Buyout leverage multiples rising as well
Buyout leverage multiples rising as well We are seeing an increase in leverage multiples primarily in larger, more cycle-resilient deals. Leverage multiples – value vs. premium industry buyouts1 Leverage multiples – small/mid vs. large/global buyouts2 2015–September 2025 2015–September 2025 5.3x 6.3
Slide 22: 2025 exit volumes up year over year
2025 exit volumes up year over year Exit momentum continued in 2025, rebounding in Q4 as tariff-related uncertainty eased PE exits to corporates ($B)1 PE exits to IPO ($B)1 $500 2000 $500 $434 400 $371 $393 $400 $400 $307 1500 300 $300 $260 $251 $267 $300 $238 $181 1000 $189 200 $200 $200 $171 500 $
Slide 23: Private equity distributions over time
Private equity distributions over time Global PE distributions were 12% of NAV through 2025, and buyout-only distributions were 13%. Despite positive momentum, distributions as a % of NAV remain meaningfully below the long-term average of 21%. Given significant NAV growth in recent years, it will li
Slide 24: Buyout distributions over time
Buyout distributions over time In 10 of the last 15 vintages, small buyout funds have distributed the highest % of prior year NAV, often during more challenging periods to exit. Smaller companies have more avenues to exit and are less dependent on IPO markets. Buyout distributions by fund size 2010
Slide 25: Exit pacing slows for high-multiple buyouts across recent cycles
Exit pacing slows for high-multiple buyouts across recent cycles Elevated entry multiples have led in part to the slowdown in exit activity. For vintages after 2016, the highest priced buyout deals appear to be the slowest to exit. Buyout exit rates by EV/EBITDA multiple quartile at entry 85% 83% 80
Slide 26: Growing number of aging companies
Growing number of aging companies As of 2025, ~60% of PE companies have reached optimal (or past optimal) hold periods (4 yrs +). US PE-backed company count by age of investment (years)1 Count by investment duration 14,000 12,918 12,000 10,000 8,000 6,000 4,000 2,000 0 2015 2016 2017 2018 2019 2020
Slide 27: Pressure on returns
Pressure on returns Select deal vintages are under pressure after a decade of shorter holds in an expansionary cycle. GPs with appropriate vintage year diversification in their funds will be better positioned. IRR distribution by invested capital – buyout deals 2001 - 2023 2006-2008 vintages ~ 8 yea
Slide 28: Comparing unrealized marks to recent transaction multiples
Comparing unrealized marks to recent transaction multiples In several GICS sectors, current private marks are higher than LTM private transactions. There continues to be a gap between buyer and seller expectations, and some portfolio companies will need to grow into their multiples or step down to c
Slide 29: PE buyouts continue to exit at slight premium to marks
PE buyouts continue to exit at slight premium to marks The average buyout deal has more consistently exited at a premium over the last 5 quarter mark, although VC exits are beginning to exit closer to their last 5 quarter marks. Exit valuation premium/discount medians in VC/Growth Equity and Buyouts
Slide 30: Private equity cashflow trends
Private equity cashflow trends Contribution activity was down in 2025, which does not reflect the increase in new deal activity in 2H-2025 given use of capital call facilities. Distributions are improving, but will take time to recover to normalized levels given growth in NAV. Q4 2025 vs. Q4 2025 vs
Slide 31: Public vs private equity performance
Public vs private equity performance 20260225-5248510-16562365
Slide 32: Private equity's long-term outperformance persists
Private equity’s long-term outperformance persists Seasoned buyout vintages have consistently outperformed the MSCI ACWI over time. However, as the spread to public markets has narrowed over the past 15 years, disciplined manager selection has become increasingly important to improve the likelihood
Slide 33: Shorter-term comparisons can be problematic…
Shorter-term comparisons can be problematic… Short-term private-to-public performance comparisons can be less reliable, as they are often driven by greater volatility of public markets 5 yr return in strong public market environment 5 yr return in weak public market environment Annualized return % A
Slide 34: … But staying the course with PE pays off over the long term
… But staying the course with PE pays off over the long term Over the past 20 years, private equity has delivered an annualized return of 12.5%, outperforming the MSCI ACWI and S&P 500 by 380 bps and 150 bps, respectively. Market-timing in PE has rarely been successful for LPs. STEP Private Equity B
Slide 35: Public market backdrop
Public market backdrop Amidst a complex market environment in Q4 2025, marked by a government shutdown, a 50 bps interest rate cut, and valuation concerns, the S&P 500 returned 2.7% 2025 was an earning story in public markets. The past three years leaned equally on earnings and multiple expansion Dr
Slide 36: PE outperformance in various public market environments
PE outperformance in various public market environments PE outperformance vs. public market return 10% Where we might be headed US private equity excess return 7% 7% 4% Where we have been 1% < -5% -5% to 5% 5% to 10% 10% to 15% > 15% S&P 500 3-year annualized total return Source: KKR. Data as of Mar
Slide 37: Large cap U.S. public stocks are trading at expensive levels
Large cap U.S. public stocks are trading at expensive levels Asset class valuations1,2,3 Percentile rank relative to valuations since December 2009* 100% Lower yield/tighter spread 90% 98% 92% 94% 80% 87% 86% 82% 84% 70% More expensive 74% 74% 60% 69% 50% 40% 30% 20% Less expensive 10% 19% 15% Highe
Slide 38: Private companies are still growing faster than publics
Private companies are still growing faster than publics Private assets across different vintages have seen stronger revenue growth compared to their public peers Annualized revenue growth rate By investment year 20% 18% 16% 14% 12.3% 12% 10% 8% 5.4% 6% 4% 2% 0% 2005 2006 2007 2008 2009 2010 2011 201
Slide 39: Private companies are still growing faster than publics
Private companies are still growing faster than publics Private assets across different vintages have also seen stronger EBITDA growth compared to their public peers Private vs. public quarterly EBITDA growth differential by sector1 By investment year 1.9% 1.8% 1.6% 1.5% 1.4% 1.0% 0.4% Communication
Slide 40: AI as a lever for potential portfolio outperformance
AI as a lever for potential portfolio outperformance We believe that PE firms that systemically partner with software and AI vendors may see greater returns Role of PE - AI may be a source of outperformance for many PE-backed portfolio companies - AI-enabled business models are transforming industri
Slide 41: AI disruption in software
AI disruption in software 20260225-5248510-16562365
Slide 42: Profit pools shift from slow to fast AI adopters
Profit pools shift from slow to fast AI adopters A selloff in software and services stocks erased ~$830 billion in market value in late January / early February, driven by investor concerns over AI advancements encroaching on enterprise software models.1 Decline in Public SaaS Mkt. Cap (No AI Tailwi
Slide 43: Enterprise AI adoption up, so software models need to adapt
Enterprise AI adoption up, so software models need to adapt Survey: AI company Pricing Models 38% 36% Enterprise AI spend transitioning from experimentation to 19% 6% ROI-backed, budgeted adoption1 Hybrid Subscription / Seat-based Usage-based Outcome-based Vibe coding / Autonomous coding Explosion o
Slide 44: Software isn't dead, but basis of competition shifting
Software isn’t dead, but basis of competition shifting Software deal activity has remained consistent, but the sector has increased its share of deal value as GPs focus primarily on vertically-integrated, mission-critical solutions that warrant higher valuations. Software PE deal activity Software P
Slide 45: AI changes to the competitive software landscape
AI changes to the competitive software landscape A resilient software company in the AI era turns rapidly advancing models into deterministic, trusted, and scalable agentic execution— embedding AI deeply into enterprise workflows and datasets to expand value, not just automate tasks. AI-resilient ch
Slide 46: Enhanced opportunity set for software
Enhanced opportunity set for software Software TAM will begin merging with labor TAM, as agentic systems start performing full workflows rather than just assisting workers. Cumulative projected AI-driven value creation $ in trillions $18 ~$17T $16 $14 $6.0 $12 $10 ~$8T $8 $5.2 $1.3 $6 $1.9 $4 $5.4 $
Slide 47: VC becoming a compelling hedge against AI uncertainty
VC becoming a compelling hedge against AI uncertainty Compute is constrained Illustrative Examples 1 Limited availability of chips, power, and data-center capacity remains the primary bottleneck to scaling AI workloads, driving the AI chip market from ~$72B in 2026 to ~$1T by 2035. Will data centers
Slide 48: Importance of manager selection
Importance of manager selection 20260225-5248510-16562365
Slide 49: PE quartile performance by fund size
PE quartile performance by fund size Disciplined manager selection is one of the factors that may lead to better returns in different fund sizes Quartile analysis (2001 – 2020 Global buyout funds) 50% 1st Quartile 2nd Quartile 3rd Quartile 4th Quartile 40% 23% - 43% 30% 18% - 30% 20% 18% - 21% 14% -
Slide 50: Buyout performance persistence came down, but first and bottom quartiles remain stickier
Buyout performance persistence came down, but first and bottom quartiles remain stickier Importance of diligence at re-up remains critical, and active PE portfolio management is needed to drive long term outperformance Current fund quartile Average current fund 1 2 3 4 IRR MOIC PME 1 35.4% 23.6% 25.
Slide 51: Venture persistence is a bit higher, and getting the right managers pays off
Venture persistence is a bit higher, and getting the right managers pays off given the large return dispersion Although VC has more persistence than buyout strategies, the wider gap in top/bottom quartile returns requires steady commitments and proactive sourcing Current fund quartile Average curren
Slide 52: Fund size growth in different market environments
Fund size growth in different market environments The median fund size increase has been 50%+ in most years since 2015, moderating slightly since 2021 While fundraising has slowed overall, some funds are receiving strong demand and increasing their fund size with swift closings, as LPs concentrate t
Slide 53: Fund size growth analysis – North America buyouts
Fund size growth analysis – North America buyouts While fund size increase introduces risks, StepStone’s analysis of North America buyout funds suggests no strong correlation to fund returns: TVM performance is broadly consistent, while median IRR is mildly weaker at >100% fund size growth. 40% of t
Slide 54: Small buyouts: market overview
Small buyouts: market overview 20260225-5248510-16562365
Slide 55: Only modest asset growth in Small-Mid Market, despite more companies to chase
Only modest asset growth in Small-Mid Market, despite more companies to chase Global private equity dry powder by fund size $ in billions $2,500 VENTURE 11% CAGR $2,000 GROWTH 10% CAGR $1,500 LRG/GLBL 16% CAGR $1,000 MID 5% $500 CAGR SBO 5% $0 CAGR 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2
Slide 56: Come for the alpha, stay for the DPI
Come for the alpha, stay for the DPI High performing Small Buyout funds have offered consistent outperformance, with attractive distribution profile North American Small Buyout top quartile returns1 TVPI DPI 3x ~10 yrs to achieve ~7 yrs to achieve 2.7x >2.0x DPI >1.0x DPI Pooled (2010 – 2022) 3x 2.7
Slide 57: Resilience during and after market contractions
Resilience during and after market contractions Cumulative return during GFC & recovery (Q4 2007 – Q2 2011)1 Cumulative return since Q4 20211 130 13% 130 25% Value (starting value =100) 120 Value (starting value =100) 120 110 100 10% -1% 110 15% 90 -23% 80 100 Small & Mid Buyouts Small & Mid Buyouts
Slide 58: Attractive performance of first-time funds
Attractive performance of first-time funds LPs should do more Fund Is than they currently do, however successful Fund I investing requires disciplined manager selection and an understanding of the unique (but manageable) challenges Comparative performance by fund vintage Early fund outperformance 18
Slide 59: Regional outlooks
Regional outlooks 20260225-5248510-16562365
Slide 60: Key themes in North American private equity
Key themes in North American private equity Pressure on distributions, elevated dry powder and elongated fundraising timelines are factors driving ongoing flight to quality, as well as opportunities in Small and Middle Market buyout strategies. Macroeconomic uncertainty continues to increase emphasi
Slide 61: Key themes in European private equity
Key themes in European private equity European private equity activity expected to rebound amidst a challenging macroeconomic backdrop PLATEAUING INTEREST RATES After eight rate cuts since June 2024, the ECB has now paused its easing cycle, keeping interest rates at 2.0% for the second consecutive
Slide 62: Key themes in Asia
Key themes in Asia Demographics, geopolitics, and fiscal/monetary policies are key factors influencing Asian markets. Asia continues to be a key growth engine of the world economy. The region’s macro and policy divergence from North America and Europe makes it critical for building a diversified and
Slide 63: European private equity as a portfolio diversifier
European private equity as a portfolio diversifier European private equity has outperformed European European GDP and private equity risk-adjusted returns are public stocks for the last 20 years broadly in line with North America… 2025 IMF GDP estimate PE realized deals since 2010 18% 27% 30% 16% 15
Slide 64: Asia PE has outperformed its public markets benchmark
Asia PE has outperformed its public markets benchmark - Asia Private Equity (including VC) has delivered consistent excess performance over MSCI AC Asia, generating alpha across most periods with peaks above +8% - Even in softer years, underperformance remained contained and shallow, reflecting lowe
Slide 65: Asia PE deal-level performance
Asia PE deal-level performance Developing Asia Developed Asia 60% 3.0x 2.6x 2.5x 2.4x 50% 2.2x 2.3x 2.5x 2.0x 40% 2.0x 32.0% 31.4% 30% 1.5x 24.1% 21.1% 21.5% Key 23% 20% 20% 16.8% 1.0x metrics 19% (all PE 13% 14% 11% 10% 0.5x incl. VC) 0% 0.0x Realized Deals Realized Deals Realized Deals Realized De
Slide 66: Diversifying your Asia exposure
Diversifying your Asia exposure Take-private opportunity set Increasing AGM participation to enact change High SME contribution Japan P/B ratio of listed companies on the Number of activist requests Employment contribution by SMEs (%) - Structural outperformance – robust and consistent Tokyo Stock E
Slide 67: Secondaries and co-investment markets
Secondaries and co-investment markets 20260225-5248510-16562365
Slide 68: Secondary market has doubled in size every 5 years
Secondary market has doubled in size every 5 years Secondary volume since 2010 2010–2025 $400 $384 $350 $295 $300 CAGR 30% $250 $226 $200 $162 $120 $150 $132 $108 $112 $87 $100 $81 $88 $64 $59 $60 $56 $60 $42 $40 $37 $57 $62 $106 $50 $28 $25 $22 $25 $25 $45 $75 $68 $33 $32 $29 $52 $52 $22 $25 $24 $2
Slide 69: Secondaries is an undercapitalized market
Secondaries is an undercapitalized market Secondary dry powder as a multiple of market volume Supply / demand imbalance may create buyer significantly less than the broader PE market1 friendly environment2 Improved selectivity Relative lack of dedicated capital to GP- leds, advantaging early movers
Slide 70: Secondary dry powder by buyers and deal type
Secondary dry powder by buyers and deal type Available secondary dry powder is at $171B, down 21% from YE’24, though buyers expect to raise an additional $218B over the next 12 months Secondary fund dry powder1 Estimated capital availability by secondary transaction type $171B LTM transaction volume
Slide 71: LP Secondaries pricing rise modestly
LP Secondaries pricing rise modestly 2025 secondaries pricing was down slightly vs. 2024 in buyouts, and recovered modestly in venture Secondary pricing over time (% of NAV)1 As of January 2026 109% 103% 99% 96% 97% 97% 94% 95% 94% 93% 92% 91% 90% 91% 89% 86% 87% 84% 88% 83% 83% 81% 78% 77% 78% 74%
Slide 72: CVs have been capturing an outsized share of trophy assets
CVs have been capturing an outsized share of “trophy”1 assets from traditional exits Returns of assets entering CVs2 % of total, 2020-2024 7% 6% The vast majority of the GP-led 25% market is characterized by assets 61% which have delivered over a 3.0x3 > or = 3.0x 2.0x to 3.0x 1.0x to 2.0x < 1.0x So
Slide 73: Pre-signing co-investments have grown as % of market
Pre-signing co-investments have grown as % of market - Sponsors are increasingly seeking to partner with select co-investors pre-signing. Co-underwriter universe is small given need to move with speed, certainty, and scale - Co-investors unable to participate in the co-underwriting/pre-signing oppor
Slide 74: Proactive and highly selective
Proactive and highly selective Broad opportunity set allows StepStone to maintain selectivity – Large, actionable pipeline of buyout deals offers opportunities in all market environments. Pipeline augmented by co-underwriting capabilities - Q4 2025 saw a 13% increase in opportunities compared to the
Slide 75: Evergreens
Evergreens 20260225-5248510-16562365
Slide 76: While evergreen structures gain traction, drawdown-led AUM growth persisted
While evergreen structures gain traction, drawdown-led AUM growth persisted through the decade Global private capital AUM forecast $ in trillions $30 $24.1 $25 $18.7 $4.4 $20 $2.7 $15 $10 $5 $0 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Drawdown funds Evergreen B
Slide 77: Evergreen growth by strategy
Evergreen growth by strategy PE and VC represent less than a third of all evergreen funds today, and only ~0.6% of the overall private equity AUM U.S. evergreen fund net AUM by strategy1 Share of active U.S. evergreen fund count by strategy2 $ in billions As of 2025 $600 15% $493.4 $500 27% 3% $400
Slide 78: Daily Valuation Engine
Daily Valuation Engine 20260225-5248510-16562365
Slide 79: Daily Valuation Engine overview and applications
Daily Valuation Engine overview and applications Overview ‒ Quarter-end valuations for private market assets are typically reported with a 60–120 day lag ‒ To estimate today’s value, Adjusted NAVs use the previous quarter’s valuation, and adjust for cashflows to date ‒ DVE builds on this, using publ
Slide 80: Daily Valuation Engine overview and applications
Daily Valuation Engine overview and applications Asset classes Geographies Strategies Private Equity Asia/Australia Primaries The Daily Valuation Engine Africa & Middle East Secondaries (“DVE”) is a model to provide Europe Co-investments quarterly valuations for private Latin America assets leveragi
Slide 81: Q4 2025 PE DVE estimation review
Q4 2025 PE DVE estimation review For Q4 2025, the model estimates a 2.5% gain in USD across StepStone’s SPI Reporting database for Private Equity. 3.7% 2.5% 3.8% Asset Class Gain / (Loss) Net Cash Flow NAV Change Private Equity 2.5% -0.07% 2.5% 100.0% 102.5% Q3 2025 Valuation Net G/L Net Contributio
Slide 82: Risks and other considerations
RISKS AND OTHER CONSIDERATIONS Risks Associated with Investments. Identifying attractive investment opportunities and the right underlying fund Existing Relationships. StepStone and its principals have long-term relationships with many private equity managers is difficult and involves a high degree
Slide 83: stepstonegroup.com
stepstonegroup.com 20260225-5248510-16562365
StepStone Group — Investor Presentation (February 2026) on 6ix