Stepstone Group Inc. · NASDAQ:STEP
Stepstone — Investor Presentation (April 2023)
25 slides from Stepstone's investor presentation, April 2023
Slide 1: StepStone Private Venture and Growth Fund ("SPRING")
StepStone Private Venture and Growth Fund (“SPRING”) FOR USE WITH QUALIFIED CLIENTS ONLY. NOT FOR PUBLIC DISTRIBUTION. THIS IS NOT AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY AN INTEREST IN ANY FUND. ANY SUCH OFFER OR SOLICIATION WILL BE MADE TO QUALIFIED CLIENTS ONLY BY THE MEANS OF A P
Slide 2: Disclosure
Disclosure Before investing you should carefully consider the Fund's investment objectives, risks, charges and expenses. This and other information is in the prospectus, a copy of which may be obtained from StepStone Private Wealth at 704.215.4300. An investor should read the prospectus carefully be
Slide 3: Firm Overview
OSTEPSTONE FIRM OVERVIEW
Slide 4: StepStone Venture Capital & Growth Equity Overview
StepStone Venture Capital & Growth Equity Overview StepStone’s venture capital and growth equity $ 28B+ 280+ 150+ platform offers comprehensive venture capital Total Capital Manager Dedicated Responsibility Relationships and growth equity solutions to our clients Professionals Focus on Global-and-lo
Slide 5: Market Opportunity
OSTEPSTONE MARKET OPPORTUNITY
Slide 6: Extended Opportunities for Private Market Value Capture
Extended Opportunities for Private Market Value Capture AVERAGE TIME TO LIQUIDITY: INITIAL FUNDING TO IPO1 US PRIVATE EQUITY/VENTURE CAPITAL FUND LIFE3 US Venture-Backed Companies Time to Full Liquidation 8 7.5 100% Avg. Time: Initial Funding to IPO 80% 73% 6 % of Funds 60% 4 3 40% 27% 2 20% 0 0% Tw
Slide 7: Rapid Acceleration of Venture Capital Investments
Rapid Acceleration of Venture Capital Investments Since 2009, US venture investment increased by a factor of over 9x through 2021, and the global pandemic accelerated the adoption of technology across all sectors. While pacing has slowed in 2022 & 2023, we believe there is still an increasingly attr
Slide 8: Outcomes Have Become Larger and More Global
Outcomes Have Become Larger and More Global These unicorns account for over VC-backed unicorns around the world 491 563 959 1,217 1,449 $5.0T UNICORNS …in unrealized value (As of May 2023) 2019 2020 2021 2022 May 2023 Unicorn: Privately held startup company with a valuation of over $1B Information i
Slide 9: Great Companies Are Created in All Market Cycles
Great Companies Are Created in All Market Cycles VC-BACKED COMPANIES VALUED OVER $1B, FOUNDED BY YEAR As of October 2022 180 160 140 120 100 80 60 40 20 0 >$1B VC-Backed Companies Founded 9 Source: Pitchbook. Chart represents $1 billion private and public venture-backed companies based on founding y
Slide 10: Attractive Historical Performance
Attractive Historical Performance Institutional and high-net-worth investors are increasing allocations to private markets, where venture capital has outperformed over the long-term 30-YEAR HORIZON POOLED RETURNS AS OF 12/31/2022 35% 30% 28.8% 25% 20% 15% 13.8% 10% 7.9% 5% 0% Cambridge US Venture Ca
Slide 11: Access and Selection are Crucial to Performance
Access and Selection are Crucial to Performance While potentially rewarding, venture capital funds exhibit the widest performance disparity of any asset class, stressing the need for access and meaningful allocation to promising managers RETURN DISPERSION 20 Year Return - Quartile Analysis (1981-201
Slide 12: Competitive Differentiators
COMPETITIVE DIFFERENTIATORS
Slide 13: The Flywheel Effect
The Flywheel Effect Our strong relationships with venture capitalists and their funds is the source of direct and secondary deal flow, which powers our investment platform Fund Investments Direct Investments Secondary Investments For illustrative purposes only. Manager logos shown represent top 5 go
Slide 14: Global Venture & Growth Program
Global Venture & Growth Program $35B of capital commitments to venture capital and growth equity since StepStone’s inception and one of the largest allocators of VC and growth equity capital SELECT STEPSTONE-BACKED VC MANAGERS STEPSTONE-BACKED GROWTH EQUITY MANAGERS These selected examples may not b
Slide 15: Differentiated Sourcing Capabilities
Differentiated Sourcing Capabilities Seek to Identify Companies Focus on Companies with a Target the Proprietary Database Backed By Top-performing Path to Success and “Rise of the Rest” and Mining Capabilities GPs Additional Growth Potential Markets1 StepStone’s investment platform is well equipped
Slide 16: Risk-Mitigated Approach
Risk-Mitigated Approach SPRING will target companies with innovative technologies with what we believe are sustainable business models potentially providing an opportunity for attractive risk-adjusted returns Technology Risk “Will this idea work?” SPRING Product Strike Zone Market-Fit Risk Risk “Is
Slide 17: Investment Strategy
OSTEPSTONE INVESTMENT STRATEGY
Slide 18: SPRING Investment Strategy
SPRING Investment Strategy Broadly diversified venture and growth strategy leveraging an open architecture approach, emphasizing experienced managers across all sectors of the innovation economy The strategy seeks to help capture the upside of venture capital using a more risk mitigated approach Ste
Slide 19: SPRING Investment Strategy
SPRING Investment Strategy CHALLENGES OF VENTURE CAPITAL ASSET CLASS1 SPRING APPROACH • Focus on growth stage assets with potentially lower risk 1 Manager & Asset Volatility • Direct Investments, Secondaries and Seasoned Primaries significantly reduce blind pool risk • Open architecture allows capit
Slide 20: Summary of Terms
OSTEPSTONE SUMMARY OF TERMS
Slide 21: Summary of Terms
Summary of Terms StepStone Private Venture and Growth Fund (SPRING) INVESTMENT OBJECTIVE SPRING’s investment objective is to achieve long-term capital appreciation Venture and growth strategy, predominantly emphasizing shorter duration, higher IRR opportunities via secondaries, later stage direct in
Slide 22: Risk and Other Considerations
Risk and Other Considerations An investment in the Fund involves material risks. Investing in the shares may be considered speculative and involves a high degree of risk, including the risk of the loss of your investment. The Shares are illiquid and appropriate only as a long-term investment. • The
Slide 23: Risk and Other Considerations (cont.)
Risk and Other Considerations (cont.) Reliance on Managers. The investment will be highly dependent on the capabilities of the underlying investment managers. Risk Associated with Portfolio Companies. The environment in which the investors directly or indirectly invests will sometimes involve a high
Slide 24: Risk and Other Considerations (cont.)
Risk and Other Considerations (cont.) ESG Integration. While StepStone seeks to integrate certain ESG factors into its investment process and firm operations, there is no guarantee that StepStone's ESG strategy will be successfully implemented or that any investments or operations will have a positi
Slide 25: Appendix
Appendix Defined Benchmarks: Cambridge Associates Index. The Cambridge Associates data is supplied by managers that may be unaudited. The indices are not transparent and cannot be independently verified and may be recalculated by Cambridge Associates/Preqin each time a new fund is added, the histori