Tpg Inc. · NASDAQ:TPG
Tpg — Investor Presentation (November 2022)
26 slides from Tpg's investor presentation, November 2022
Slide 1: Investor Presentation
Investor Presentation November 2022 TPG HIGHLY CONFIDENTIAL — NOT FOR DISTRIBUTION
Slide 2: Disclaimer
Disclaimer This presentation is being provided by TPG Inc. (“TPG,” “we,” “our,” “us,” or the “Company”) solely for informational purposes for its public stockholders. To the maximum extent permitted by law, none of us or our affiliates, directors, officers, partners, employees, agents, or advisors o
Slide 3: Disclaimer
Disclaimer Industry and Market Data This presentation includes market and industry data and forecasts derived from publicly available information, various industry publications, other published industry sources and the management’s knowledge of the industry and the good faith estimates of management
Slide 4: A Leading Global Alternative Asset Manager
A Leading Global Alternative Asset Manager Five Distinct Platforms Our Scale Capital 1,101 employees Scaled private equity and $68B investment and leveraged buyouts AUM 390 ops professionals Growth 12 A global investment global offices Growth equity and buyouts, $22B $135B flexible capital AUM activ
Slide 5: TPG's Strategy is Built for the Next Era of Alternatives
TPG’s Strategy is Built for the Next Era of Alternatives “Scaling” Era “Scaled Differentiation” Era Levered Beta Alpha Opportunities Mega Fund-centric Targeted Products Returns Returns, ESG, and Impact Transaction Type Sectors and Solutions Fund-centric Relationships Bespoke Firm-centric Relationshi
Slide 6: Attractive Scale and Go-Forward Growth
Attractive Scale and Go-Forward Growth Note: Estimates are inherently uncertain and subject to change. Actual results may vary.
Slide 7: Scale Across Five Multi-Product Platforms
Scale Across Five Multi-Product Platforms Capital Growth Impact Real Estate Market Solutions $68 Billion $22 Billion $16 Billion $20 Billion $10 Billion AUM AUM AUM AUM AUM Leading impact investing Multi-product real estate Flexible investing platform Platform focused on leveraging Scaled private eq
Slide 8: Anchored in Asset Classes Experiencing Meaningful Growth
Anchored in Asset Classes Experiencing Meaningful Growth $23.3 Strong Secular Tailwinds $21.0 $19.3 1• Increasing allocation to $17.8 alternatives globally Alternative Industry $16.2 $15.0 AUM Forecast $13.7 2• Consolidation of limited partner 2017 – 2027E | $Trillions relationships to leading, scal
Slide 9: Demonstrated Success Pursuing Market Opportunities Through Organic Innovation
Demonstrated Success Pursuing Market Opportunities Through Organic Innovation TPG NEXT Capital Growth Impact Real Estate Market Solutions Rise Climate $16B Evercare AUM Rise I Rise II Rise III TDM 2017 TTAD I TTAD II $22B 2007 AUM Growth I1 Growth II Growth III Growth IV Growth V THP I THP II TPG I
Slide 10: Deep Limited Partner Relationships with Significant Opportunity for Expansion
Deep Limited Partner Relationships with Significant Opportunity for Expansion Our Reach Limited Partners by Type3 Limited Partners by Geography3 >550 Institutional limited partners Endowments Latin America 3% Other 1% 15 year Average tenure of existing LPs1 Financial Institutions 4% 2% Canada 8% Ins
Slide 11: Rapid and Diversified Platform Growth
Rapid and Diversified Platform Growth… AUM Evolution Total Number of Products % 2016 3Q’22 17 Market Solutions Market Solutions Real Estate 3% 7% 3 6% Real Estate ~2X Growth 15% 3 16% 9 Capital 4 50% Impact 3 12% 2 4 Capital 75% Growth 2 16% 3 2 Real Estate and Impact platforms have scaled considera
Slide 12: Driving Strong and Consistent Scaling of AUM and FRE
…Driving Strong and Consistent Scaling of AUM and FRE Assets Under Management Fee-Related Revenue (FRR)1 $Billions $Millions $1,017 $135 $874 $691 $727 $535 $114 $90 2018 2019 2020 2021 LTM 3Q'22 $85 $80 Fee-Related Earnings (FRE)1 $67 $Millions $60 FRE Margin 40% 37% 31% 26% $406 $326 9% $182 $227
Slide 13: FRE-Centric Public Company Model with Attractive Yield
FRE-Centric Public Company Model with Attractive Yield Profitable Balance Sheet Attractive FRE Centricity Growth Light Yield Prioritization of FRE, allowing Targeting 45%+ FRE margin2 stable growth through cycles Intend to pay out at least 85% of by the end of 2023 driven Capital-light business mode
Slide 14: Excellent Investment Performance Across Recent Fund Vintages
Excellent Investment Performance Across Recent Fund Vintages Performance Momentum as of 9/30/22 Fund Vintage Gross IRR Gross MoM Net IRR Net MoM Substantial realization cycle TPG VIII 2019 59% 1.6x 37% 1.4x TPG VII 2015 28% 2.4x 22% 2.0x over the last few years Capital THP I 2019 57% 1.6x 32% 1.3x d
Slide 15: Scaling of Next Generation of Existing Funds
Scaling of Next Generation of Existing Funds Capital Growth Impact Real Estate $18.8 $7.4 $8.6 +37% TDM 0.5 Asia VII +39% $9.4 TAC+ 4.6 $13.8 1.8 Asia $5.3 TTAD II TDM +132% THP 2.6 Rise Asia VI TAC+2 2.7 TTAD I Climate 3.3 THP TTAD +348% Rise 1.6 Gator 0.7 Climate TREP Rise TPG Growth 7.3 $3.7 TREP
Slide 16: Record Levels of Dry Powder
Record Levels of Dry Powder Available Capital $Billions Dry powder represents $46 ~2x 57% of fee earning AUM1 $28 $26 Strong position to deploy capital in an increasingly interesting and attractive investment environment 2020 2021 3Q'22 1. As of September 30, 2022. 16
Slide 17: Broad Array of Meaningful Growth Opportunities Ahead
Broad Array of Meaningful Growth Opportunities Ahead 1 2 3 Scale Existing Businesses New Adjacent Products Inorganic Growth raised for six Significant whitespace in • Carefully size and raise successor funds $21B new products since 2018 complementary asset classes and distribution channels • Greater
Slide 18: Our Differentiated Approach
Our Differentiated Approach
Slide 19: Distinct Investment Style
Distinct Investment Style Sector Flywheels Mining for Alpha • Long-term, thematic investors • Focus on what is interesting, across core sectors THP / Capital Capital even if not immediately actionable • Build deep conviction and ecosystems behind go-to-market Pharma • Pursue areas of change and Outs
Slide 20: TPG Operations as Partners in Value Creation
TPG Operations as Partners in Value Creation Sector Leadership Functional Experts HR Transformation Pricing Consistent operating standards in onboarding to ensure a fast start Finance Marketing and strong early performance General Management Salesforce Effectiveness Procurement Cross-Portfolio Progr
Slide 21: Demonstrated Commitment to ESG Excellence
Demonstrated Commitment to ESG Excellence Launched Signed on as a founding partner Became a signatory to Authored guidance for Joined the Business TPG Rise Climate of Ownership Works to the UN Principles of PCs encouraging Coalition for the accelerate broad employee Responsible Investment preservati
Slide 22: Appendix
Appendix
Slide 23: Summary Balance Sheet
Summary Balance Sheet Unaudited Non-GAAP Balance Sheet Measures TPG Operating Group ($M) Balance Sheet 9/30/22 Cash and cash equivalents $572 Restricted cash 13 Accrued performance allocations 725 Investments in funds 582 Other assets, net 570 Total Book Assets 2,462 Accounts payable, accrued expens
Slide 24: FRR and FRE Bridge
FRR and FRE Bridge 2018 2019 2020 2021 3Q22 3Q22 LTM GAAP Revenue $1,404 $1,988 $2,115 $4,976 $561 $2,643 Capital-allocation income (557) (956) (1,231) (3,998) (228) (1,454) Deconsolidation of former affiliate (207) (240) (87) -- -- -- Expense Reimbursements (125) (152) (110) (133) (54) (173) Invest
Slide 25: DE Bridge
DE Bridge 2018 2019 2020 2021 3Q22 3Q22 LTM GAAP Net Income $711 $1,180 $1,439 $4,656 $53 $787 Net (income) attributable to redeemable interests in Public SPACs 27 10 196 (155) (7) (35) Net (income) attributable to non-controlling interests in consolidated TPG Funds (19) (58) 12 (19) -- (11) Net (in
Slide 26: Unaudited Pro Forma Non-GAAP Balance Sheet Bridge
Unaudited Pro Forma Non-GAAP Balance Sheet Bridge 3Q22 Total GAAP Assets $8,597 Impact of consolidated TPG Funds and Public SPACs (1,010) Impact of other consolidated entities (5,174) Impact of reclassification adjusments 1 50 Total Book Assets $2,462 Total GAAP Liabilities $4,829 Impact of consolid