Stepstone Group Inc. · NASDAQ:STEP
Stepstone — Investor Presentation (June 2024)
25 slides from Stepstone's investor presentation, June 2024
Slide 1: StepStone Academy: Infrastructure & Real Assets
StepStone Academy Infrastructure & Real Assets For Educational Purposes Only
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: Today's presenter
Today’s presenter Jake Kelsall Principal, StepStone Group STEPSTONE GROUP 3
Slide 4: What is Infrastructure?
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Slide 5: What is infrastructure?
What is infrastructure? Infrastructure assets are economic and social necessities that deliver services and products needed to improve society’s quality of life, social well-being and safety. The infrastructure investable universe continues to expand to include new classes such as communications and
Slide 6: Types of infrastructure investments
Types of infrastructure investments There are a number of different types of infrastructure investments, with distinct characteristics • Greenfield projects involve an asset that needs to be designed and constructed where no infrastructure previously existed. GREENFIELD VS. BROWNFIELD • Brownfield p
Slide 7: 'All-Weather' investment rationale across cycles
‘All-Weather’ investment rationale across cycles The key characteristics that make infrastructure attractive for investors are even more relevant in the current market environment Downside protection • Limited competitive pressure from monopoly positions / barriers to entry • Essential services with
Slide 8: An Evolving Market
An Evolving Market
Slide 9: Significant need for infrastructure investment globally
Significant need for infrastructure investment globally $3.9 TRILLION Global investment required per year from 2026 POWER ROADS RAIL TELECOM WATER AIRPORTS & PORTS $1.3 TRILLION $1.3 TRILLION $0.4 TRILLION $0.3 TRILLION $0.3 TRILLION $0.2 TRILLION ANNUALLY ANNUALLY ANNUALLY ANNUALLY ANNUALLY ANNUALL
Slide 10: Evolution keeping pace with societal needs
Evolution keeping pace with societal needs More recently, the traditional infrastructure universe has seen the expansion of the digital segment and the development of new investment categories such as energy transition and infrastructure as a service across sectors EVOLVING INFRASTRUCTURE LANDSCAPE1
Slide 11: Secular trends drive the investment opportunity
Secular trends drive the investment opportunity Digitalization The increasing availability of data, coupled with analytics and automation requires advanced digital infrastructure. Supply chain transformation Global supply chains adapt to new requirements arising from new consumer preferences, e-comm
Slide 12: While investment needs in mobility and transportation are large
While investment needs in mobility and transportation are large… Transportation-related infrastructure is expected to require over US$2 trillion of annual spend largely driven by growing demand, urbanization and required decarbonization initiatives Average annual investment in transport infrastructu
Slide 13: Investment needs in energy are massive
…investment needs in energy are massive… The US energy grid is forecast to remain short electricity and will require trillions of private capital annually to avoid shortfalls and support economic growth US Electricity Demand (thousand TWh) Average Age of Electricity Grid Assets (years) +38% 6.0 50 5
Slide 14: Digitalization also requires a lot of new investments
…and digitalization also requires a lot of new investments Digital infrastructure has become a cornerstone sector strategy for many GPs Volume of data created and consumed globally, 2010 - 20251 Exemplary infrastructure investment themes (in zettabytes) 200 Roll-out of fiber networks and their upcom
Slide 15: Why Invest?
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Slide 16: Investors globally are increasing allocations to infrastructure & real assets
Investors globally are increasing their allocations to infrastructure & real assets as the market continues to grow rapidly 1 Attractive investment fundamentals in the current market conditions 2 Strong sectoral tailwinds driving sustained returns 3 Improved scale and quality of investment opportuni
Slide 17: Infrastructure has delivered attractive returns, low volatility and downside protection
Infrastructure has so far delivered attractive returns, low volatility and downside protection… Notwithstanding a recent challenging macro environment including a pandemic, soaring inflation and higher interest rates, the asset class has continued to outperform on a risk-adjusted basis Infrastructur
Slide 18: Private infrastructure returns vs. public markets
Private infrastructure returns vs. public markets Private infrastructure continues to outperform listed infrastructure with lower volatility Evolution of USD invested on March 31, 2008 (Quarterly returns) Annualized volatility 6.00 Index Return quarterly returns Market Downturns MSCI Global Private
Slide 19: Low correlation compared to major asset classes
Low correlation compared to major asset classes Public and private market correlations 2008-2023 Global core infrastructure Global core infrastructure 1.0 Global bonds -0.1 Global equities 0.0 US core real estate 0.4 Private equity 0.2 Source: MSCI, Bloomberg, Burgiss, NCREIF, J.P. Morgan Asset Mana
Slide 20: Infrastructure is a growing segment in private markets
Infrastructure is a growing segment in private markets Infrastructure AUM has grown by 25% CAGR since 2000, to 10% of all Private Markets AUM. Post-GFC, capital formation increased from ~$168 billion in 2010 to ~$1.3 trillion in H1 2023 Private markets AUM by asset class (%) Infrastructure unrealize
Slide 21: In Summary
In Summary Key characteristics that make infrastructure attractive for investors are as relevant as ever Infrastructure characteristics Investment rationale Provision of essential services: Infrastructure are the backbone for basic, Stable and predictable income irreplaceable public services that su
Slide 22: StepStone Academy
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Slide 23: Thanks for joining!
Thanks for joining! Contact us: Phone: 704.215.4300 Email: stepstonepwreplies@stepstonegroup.com
Slide 24: Risks and Other Considerations
RISKS AND OTHER CONSIDERATIONS Risks Associated with Investments. Identifying attractive investment opportunities and the right underlying fund Allocation of Investment Opportunities. StepStone currently makes investments, and in the future will make managers is difficult and involves a high degree
Slide 25: stepstonegroup.com
stepstonegroup.com